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Intellectual property, or IP, is often underestimated or misunderstood – at least in the world of entrepreneurs. How you manage your IP can make or break your venture.
IP is ‘creation of the mind’ and includes patents, copyrights, trademarks, industrial design and trade secrets. Every business is based on an idea, from ground-breaking research that leads to a new drug, technology or product, to new ways of applying good ideas that have come before.
As the global economy continues its historic shift from raw materials and manufacturing to knowledge-based, the valuations of an increasing number of companies are completely taken up by IP.
If that doesn’t describe your business, don’t worry, you’re not alone – especially in Canada, where we lag innovation powerhouses like the United States. But as an entrepreneur, you are well advised to bone up on IP, in general, to take the best advantage of – and protect – that which you create.
With IP it’s important to appreciate the concept at the get-go, says Dr. Gabriella Chan, a scientist-turned-lawyer who is founder of Yocto Law in Toronto. Chan’s primary focus is working with academics and the companies that are spun out of academic institutions. But to meet market demand, she ends up mentoring, advising and speaking to entrepreneurs at all stages and of all stripes about IP strategy, the bulk of which involves patenting.
A lot of people end up stepping on their own toes by speaking about their ideas too early, says Chan. They don’t understand that filing a provisional patent application might be the right approach for them because they haven’t done their research or spoken to the right professionals.
Robert Irani of Bennett Jones is one of those professionals. He’s a Calgary-based intellectual property lawyer as well as a U.S. patent attorney, U.S. trademark attorney and Canadian patent agent. He says the cost of properly preparing a patent application, in particular, can be prohibitive to many small business owners. But trying to save money with so-called cookie-cutter templates will cost you more in the long run.
Cookie-cutter templates may leave you with a weaker patent application, says Irani. You may save a few bucks on the front end, then you get one that isn’t very good. Later you may discover a problematic piece of prior art, for example, and your patent, and potentially your business, gets knocked out of the water.
Most companies will employ a number of IP streams as they grow and evolve. How you employ them, and when, will be dictated by your business strategy.
It’s a parallel stream, explains Chan. Your patent or IP strategy fits within the business strategy, not vice versa. Depending on your business goals and objectives, and other factors in the market, your IP strategy might have to change.
Chan and Irani’s IP advice for entrepreneurs can be summarized this way:
- Inform yourself about IP: Do your homework about IP and what it means for your business. Take advantage of the free, easily-accessible resources available through the Canadian Intellectual Property Office, the United States Patent and Trademark Office or the World Intellectual Property Organization.
- Pursue provisional patents early: You may be excited about your idea, but be ultra-cautious about with whom and how you share information. If you’re unsure, consult with a licensed patent agent or patent attorney. You cannot publish information about your idea on your website, or start to sell or market it in any way if you hope to obtain a patent.
- Ask for help from the right people: Go with the pros. Resist the temptation to save money by handling protection of your IP on your own. That is short-term thinking that could cost you everything in the long run.
- Realistically consider geography: Patents and trademarks filed in Canada will only protect you in Canada. On the other hand, there’s no need to go through the time and expense of filing and registering globally if your realistic market will remain in North America.
- Ensure there is a market: Technically this is general business advice, not just IP. But Chan says that nine out of every 10 businesses fail in the first five years because they’ve created fantastic solutions for non-existent problems.
Don’t let that be you. Protect your intellectual property – and your venture.
Between them, Boni and John Wagner-Stafford have five decades of experience as entrepreneurs and/or providing consulting services to other small businesses across Canada.
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