Startups Beware – Protecting your Intellectual Property is vital when starting a new business
One of the most common queries we receive from new businesses is: “We have a great idea, we have secured the domain name and we are ready to launch our business…” What you need to remember is that before disclosing anything to potential business partners, suppliers or the public it is vital to protect your Intellectual Property. Businesses that don’t, risk losing these assets and once they are in the public domain they may be lost forever. Most importantly protecting your Intellectual Property will save you time and money.
Register your brand/logo/name as a Trade Mark
If you have a unique, original name securing the domain name, company or business name will not give you the exclusive legal right to use that name to promote your product or service in Australia. To obtain this right you will need to file a Trade Mark. Once registered, your Trade Mark is an asset that will add value to your business. Registration lasts for 10 years and gives you to the right to use that brand to the exclusion of other businesses. Over time it also protects your businesses reputation and goodwill. Trade Marks are becoming increasing important as meta-tags and search engine optimisation which may give you a competitive advantage when consumers are searching for your business online.
Copyright Protects Your Content
Copyright exists in creative works being reduced to a material form. For example, your website content is protected by copyright. If you write it yourself then you own the copyright but if you have someone else such as a copywriter produce the content then you will need to ensure they agree to assign the copyright in writing. Computer code, music, art work, photographs, databases and multi-media are also works protected by copyright. In Australia, unlike in some other jurisdictions there is no need to register your copyright to protect your interest. You can also license your copyright and earn fees or royalties or assign it when you sell your business. When writing content for your website your original ideas are also important as Google provides better rankings for original content.
Contracts with Suppliers and Business Partners are Equally Important
Before engaging a supplier to work on your idea, whether it is developing software, writing content or designing a logo you need to ensure the copyright is assigned to you. In most cases, in the absence of agreement, copyright in a creative work will remain with the author of that work even though you have paid for it. Having a Master Services Agreement or Software Development Agreement in place upfront will ensure you avoid these types of disputes before your launch your business.
The other area to avoid and where clients experience disputes are not having agreements with business partners. Generally, a proprietary business structure is used to operate your business. You and your business partner become directors and shareholders of that company and it is all going along really well, until one person feels they are contributing more than the other. They want you to buy them out, but it was your idea in the first place. Do they have the right to demand a buyout? This is where the problem arises. It becomes an expensive problem if you do not have agreements in place with your partner to state what will happen if you wish to go your separate ways?
Six Vital Agreements and Protections for Start-Ups
While every business is different and will have a unique strategy to commercialise its ideas there are six areas that we strongly recommend you consider:
- Registering your Trade Mark to protect your brand;
- a Non-Disclosure Agreement before your disclose any of your ideas to anyone;
- ensure your have your contracts in place, for instances a Master Services Agreement with your website developer;
- a Shareholders’ Deed with your business partner;