Balancing IP and business – the startup dilemma

Balancing IP and business - man on tightrope

Starting a business is a unique task and balancing IP and business is often a challenge. While a company can be based on one great idea, bringing that invention to the market requires problem solvers willing to tackle any challenge. Just inventing a better mousetrap is not enough; you also have to select the ideal corporate structure for your business, hire engineers to build prototypes, market your product, find the right manufacturing partner and build a trusted distribution network in your home markets. These are of course just some of the challenges that entrepreneurs face. With such a long to-do list, it is not surprising that inventors often don’t get around to protecting their intellectual property.

But IP protection is important. For startups and inventors, the one asset they have that others won’t is likely their intellectual property, that great invention or design that makes them different from their competitors. Most new companies are small, have very little capital, and frankly aren’t worth much except for that big invention. It is also important to ensure that name and brand are protected against current and future competition. At the same time, more complex processes such as getting patent protection must be balanced against other pressures such as time and money.

Focus, but don’t go it alone

The most important lesson is to have a clear understanding of what is most important about your business plan or product. If you cannot afford to patent every piece of technology you invent, focus on what is your competitive advantage. Similarly, look at which of your inventions are the most easily copied or reversed engineered. If a key technology can be easily replicated once your product goes to market, then that may what you need to protect.

Legal assistance is often essential. Patent applications for example are enormously complex and will often involve multiple rounds of revisions due to objections from the patent office. (In countries such as the US and the UK, the Patent Office will rarely grant a patent on the first application; the examiner will often reply with objections that require the applicant to clarify or narrow the claimed technology that being patented.)

This last piece of advice goes against the startup do-it-yourself ethos, but it is extremely important. A badly drafted patent for example could have serious consequences for both your IP and business; not only may it not protect your invention, but it may also lead to disclosure of your technology, which could prevent you from acquiring patent protection even if you decide to hire a patent attorney later on.

Finally, though getting patents and other IP protection may seem like a drain of resources, your IP may in fact be key to helping you secure funding. Venture capitalists and investors are increasingly wary of companies that do not have their IP house in order, and many refuse to invest in companies that do not take care of IP protection. An IP strategy is therefore key for protecting both your IP and business, even if the portfolio starts out small. is a global marketplace for innovation and intellectual property (IP) that makes access to legal, investment and other services easier for startups, inventors, small businesses, universities and companies. Users can connect with over 2,000 lawyers, patent attorneys, business strategy consultants, investment professionals and other experts working with innovation and IP worldwide. IP owners can also upload patents and other IP to our IP Exchange, which currently lists over 70,000 patents available for sale or license. Need help or information for your business or intellectual property? Post a question to our legal and IP experts. See our IP Nexus explainer video here.
The information provided in articles on does not constitute legal advice and is not intended as such by either the authors or by IP Nexus, subject to our Terms of Use.
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