IP Reference Kit for Startups
Investors have put in around 33.62 billion dollars into the Indian startup ecosystem since 2014. Additionally, the pooling of half of that amount took place in 2017 ($13.7 billion) and the first quarter of 2018 ($2.26 billion). Hence, this staggering number stands proof that the Indian startup ecosystem is here to stay.
A successful IP reference kit for startups delivers a great idea, or takes an initiative in a relatively short period of time in contrast to traditional business set-ups.
Technology has fundamentally changed the way startups operate. Most of the startups are using state-of-the-art technology to find innovative solutions. Thus, such innovations need funding for scaling-up of the prototype models. Before funding, investors look at various aspects such as the viability of a startup business, scalability scope, the initial investment required, returns on investments over a period of time, etc. However, one of the most crucial one is the startup’s IP protection and their overall IP strategy.
Although the mindset of Indian startups is changing rapidly, many are still ignorant about this crucial component.
A proper IP strategy includes planning around factors such as: what aspects must undergo protection, when to undergo protection, in which countries to file, and the potential infringement approach.
Thus, IPRs which are most relevant for startups are as follows:
- Trade Secret
Furthermore, the criteria for protection of each type of IP is different and is as follows:
|Type of IPR||Criteria for Protection|
|Patents||1. Inventive Step 2. Novelty 3. Industrial Applicability|
|Trademark||Uniqueness/Distinctiveness (inherent or acquired)|
Basic Advantages of IP Protection:
It’s incredibly important for a company to manage its IP wisely from a competitive standpoint. Therefore, startups strive to stand out in a market. In order to stay ahead, protecting and managing their IP is crucial. Managing IP diligently may take effort and investment, but it can be worth it. Hence, below are some of the advantages of being an IP-conscious startup:
- It helps the founders and innovators safeguard their research and development efforts.
- The threat of unfair competition and other copying minimizes with enforcement measures.
- Protected ideas lead to high investor confidence. IP Reference Kit
- Especially, the company’s ability to attract innovative employees, vendors and collaborators increases if their IP undergoes protection. Thus, this creates a secure environment for all – where no one fears to lose their efforts to competitors.
- Develop an attitude conducive to defend IPR and innovate with freedom.
- Ensures the freedom to operate locally and open channels for global expansion.
- Generate revenue through licensing. Thus the IP behind the product/technology may undergo selling later if the owner (assignee) of patents decide to focus their attention elsewhere or even desire for some financial consideration.
- Increase the market value of products and technologies – strengthen the marketing strategy.
- Strategically align with potential market leaders and leverage the advantages of IP through cross-licensing.
- Lastly, it develops partnerships for research and development activities with confidence.
Non-registration of IP may lead to problems like overnight disruptions through competitors, difficulty in obtaining legal relief in case of infringements, less investor confidence, having nothing in hand to counter if someones sues for IP infringements via competitors, loss of licensing opportunities, etc.
Choosing the Right Type of IP for your Business
Each type of IP protects a different aspect of your business and have different applicable fee and filing requirements. Time period for which you get protection also differs for each type of IP.
Moreover, our e-book provides some essential information to startup founders, entrepreneurs and investors which enable them in taking right and well-informed decisions at the time of making an IP strategy or investing money in a startup. Download here and have a look at the different aspects you should consider before planning your IP strategy.
Click here to know more about F3 Analysis Model.