So you have a great idea and have taken the next step of starting up a business. But do you have an idea worthy of protection? As your business grows and develops an increasing number of questions around risk and protection will arise, and if you're a startup you need to start thinking about these issues sooner rather than later. How does your increasing market presence expose you to counterfeiters and copycats? Do you wish to create a valuable asset for your business? If the answer to either of these questions is yes, then it's time to consider your options when it comes to intellectual property. We spoke to Matthew Hives of agency One Stop IP about how being smart about your IP can have huge benefits for startups.
What is IP?
Simply put, it is taking ownership of your ideas. Take your phone, for example. What ideas go into this phone? Well first of all, a company will produce this phone. This company’s logo will invariably be displayed on the phone. If the brand is successful, then the company will be easily identifiable by the logo on the phone. This symbol represents the company and what it stands for. Therefore, it is in the company’s best interest to take ownership of this to stop it being used by competitors. Your phone contains physical components that perform functions. Someone will own these inventions, whether it be the company who produced the phone, or whether it is included in the product under license. Even your phone’s shape is protected. Is it a particularly memorable shape? Is it easily identifiable? Any of these key factors can be the unique selling point for a brand.
Some people view IP as just a means of protection and nothing else. According to a WIPO report, businesses with quantified and managed IP assets are on average worth twice as much as a similar business of the same size in the same sector without them. Here, we will show you how IP can be harnessed effectively to add value to your startup.
Your brand is an asset
In the consumer-driven world we live in, brands are an important way of advertising product/service quality and increasing margins through reputation. A brand protected with a combination of trademarks, domains, social media and copyright can become a valuable asset for a business if utilised in conjunction with marketing strategies and business operations.
Gain a competitive advantage with protected innovation
Does your business hinge around your unique innovation? If yes, think about what makes it unique and how you can protect it. It may be as simple as keeping it secret or having secure practises to ensure that your innovation is safe. If your idea is particularly novel, then it may be possible to protect through a patent. Patents are not only a way of ensuring your ideas are protected, but also of securing your competitive advantage in your field. Innovation drives the value of your business - the more novel you are, the increased likelihood of attracting investor’s attention.
Drive traffic with domains
As your business expands, your domain name will become more valuable due to its potential to harness internet traffic and your company’s reputation. Increased profile means that there is an increased risk of foreign counterfeiters and acquisitions of similar domain names by competitors looking to piggyback off your success (which is a surprisingly common occurrence). By increasing your domain name portfolio to protect the main site, not only do you get increased security against copycats, but also you are able to drive more traffic to your main web page. As with all IP assets, the value of your domain name portfolio will increase with the growth of your business.
A coordinated social media approach
You probably didn’t consider that social media was intellectual property, but as a platform that can represent a company and convey its ideas, it's definitely included in this bracket. A well-coordinated social media strategy is able to act as an interface with the public and cut marketing costs for small businesses. As well as making your accounts valuable to the business, it protects your company name in the eye of the public.
Investment through IP strategy
With a clear IP strategy set in place, a startup becomes an attractive option for investors looking to fund a well-coordinated venture due to the mitigated risk of counterfeit/copy, the competitive advantage of protected innovation, and the added value from these liquid assets.
Case Study: Dashel
The Virgin StartUp-funded company Dashel Helmets has spent the past four years developing a cycle helmet with a thinner liner that doesn’t degrade over time, even if dropped or knocked. Founder Catherine Bedford spotted a gap in the market for good-looking head protection, and the innovative technology means that Dashel helmets are able to be both durable and stylish.
Their unique branding, product design and web-based shop front has created a great deal of interest, and the helmets even featured in Cycle Revolution at The Design Museum, which is set to tour worldwide. The potential value gained through years of development and investment has been increased through patent-protecting technology, secured domain names, trademarks and registered designs in UK and European jurisdictions. The company is now seeking further IP protection for an expansion into the US and Far East, where the cycling market is booming. Dashel has utilised IP to develop their brand and protect the design, so they can target new markets.
“OneStopIP has provided an invaluable service," says Catherine. "When you have invented a product you are paranoid about copycats, and could easily be persuaded to pay for more protection than you need in the developmental stages. OneStopIP has worked with us on an IP strategy to ensure that we never spend any more money than we need to on IP, at each stage of development. This has been crucial in the pre-revenue stage, when manufacturing is always the priority for funds.”