What is Intellectual Property?

Intellectual Property (IP) refers to creations of the mind, such as inventions, literary and artistic works, designs, symbols, names, and images used in commerce. For a technology startup, your IP is often your most valuable asset. Protecting it is essential for building a defensible business and attracting investors.

The Four Main Types of Intellectual Property

1. Patents

• What it protects: Inventions. This includes new and useful processes, machines, manufactures, or compositions of matter.
• How to get it: You must file a detailed application with the U.S. Patent and Trademark Office (USPTO). The process is long, complex, and expensive, requiring a specialized patent attorney.
• Key takeaway for startups: A patent gives you the right to exclude others from making, using, or selling your invention for a limited time (usually 20 years). It is a powerful competitive advantage, but not all software is patentable.

2. Copyright

• What it protects: Original works of authorship fixed in a tangible medium. This automatically includes your source code, website content, marketing copy, videos, and presentations.
• How to get it: Copyright protection is automatic the moment you create the work. You can formally register your copyright with the U.S. Copyright Office, which provides additional legal benefits, but it is not required.
• Key takeaway for startups: Your code is a critical copyrighted asset. Ensure you own the copyright to all code written for your company.

3. Trademarks

• What it protects: Your brand identity. This includes your company name, logo, slogans, and any other symbol used to distinguish your goods or services from others.
• How to get it: You establish trademark rights by using the mark in commerce. However, you should formally register your trademark with the USPTO to get nationwide protection.
• Key takeaway for startups: Before you fall in love with a name, do a trademark search to make sure it's not already in use. Protecting your brand is crucial for long-term value.

4. Trade Secrets

• What it protects: Confidential information that gives your business a competitive edge. This can include customer lists, secret formulas (like the recipe for Coca-Cola), proprietary algorithms, or internal processes.
• How to get it: Protection is established by taking reasonable steps to keep the information secret. There is no formal registration process.
• Key takeaway for startups: Use Non-Disclosure Agreements (NDAs), employee confidentiality agreements, and internal security measures to protect your trade secrets.

The Most Important IP Issue for Founders

IP Assignment: Every single person who contributes to your product—including all co-founders, employees, and independent contractors—must sign an agreement that explicitly assigns all intellectual property they create for the company to the company.

This is known as an Invention Assignment Agreement or a Confidential Information and Invention Assignment Agreement (CIIAA). Without these agreements in place, individuals could legally claim ownership of parts of your product, which can destroy your company's value and make it impossible to get investment.

Make sure this is one of the first legal documents you have in place.