After working with many startup entrepreneurs over the years, I have consistently seen that those looking to build a successful startup company spend too much time on “fighting fires” (i.e., tactics) and too little time on “the big picture” (i.e., strategy). While there are many examples of such misplaced activity, my specific expertise is in the area of IP Strategy. Not coincidentally, I think the typical lack of attention by entrepreneurs to IP Strategy is a primary reason for the dismal probability that their startup will be successful.
While patents, trademarks, copyrights and trade secrets are commonly thought of when the phrase “intellectual property” comes to mind, in reality, a multitude of protectable forms of IP and intangible assets can be used to create and maximize startup business value. Of course, each startup entrepreneur must deploy the specific IP Strategy suitable for her business model. Nonetheless, a universal starting point for identifying, protecting and maximizing the startup business value relating to IP (and intangible assets) can be framed in this straightforward manner:
- What aspects of my business model differentiate me from my competitors?
- Would I find it difficult to meet my revenue projections and desired exit payback if someone copied the differentiated aspects of my business model?
With regard to the first question, most entrepreneurs should find it easy to define the differentiated aspects of their business model. Indeed, each startup is presumably based upon one or more identified needs that are not currently being met. These differentiators will then serve as the competitive advantage provided by the startup. As for the second question, most entrepreneurs will agree that it would be difficult for them to succeed in their goals if a competitor were able to copy the differentiated aspects of their business model. A “yes” to each of these questions should convince you that an executable IP strategy should form an essential aspect of a startup’s key activities.
It is important to clarify here exactly what I mean by “IP strategy.” Significantly, IP strategy does not necessarily mean that the end goal is to obtain enforceable IP rights, whether a patent or otherwise. Rather, an IP strategy directed toward value-creation requires an understanding whether and how protection of the differentiated aspects of the business model will enhance the entrepreneur’s ability to achieve her revenue and exit goals. To illustrate, not getting a patent is a patent strategy if the decision is made for reasoned and articulated business reasons.
This blog will frequently focus of specific types of IP value that startup entrepreneurs like you should be thinking about. In the meantime, please feel free to contact me at jhutter@leanlegalteam.com or check out my IP Asset Maximizer blog where I have been providing my opinions on creating identifying, capturing and leverage business value from IP for over 6 years.
[photo credit: uafamily.arizona.edu]
