Here are ten tips to help you protect your intellectual property (IP) and get your IP strategy right.
1. Identify your IP
Your new business may have a wealth of IP. From the name on your door, to an innovative new process, there will be things that differentiate you from your competitors. As your business grows, so too will the importance of these intangible assets.
2. Understand your options
Understand the different types of IP and the advantages of each one. Patents protect inventions, design registration protects their look. A registered trade mark protects brand names, logos, original sounds and scents, and even aspects of packaging.
For example, young Australian motocross bike innovator Brad Smith decided not to apply for design IP on his superlite bikes. For those new to IP strategy, this may have seemed like a risky proposition.
But Brad stuck to his guns. He believed it made more business sense to build up his company’s reputation and therefore apply for a trade mark over his Braaap logo, than pay extra money for a design IP, which he believed would face constant and expensive challenges from IP trolling.
It seems to have worked. Braaap bikes have gone from a single outlet in Tasmania to exporting overseas.
3. Keep it confidential
Keep your idea confidential until it is protected. If you’re talking to others about your idea, use a non-disclosure agreement (NDA) to prevent them from disclosing your idea without permission. Check out our IP Contract Generator for help preparing an NDA.
If you are interested in obtaining a patent or design, you need to safeguard and maintain secrecy until you have filed your application. You may determine that keeping your invention a secret is better than applying for a patent and having to disclose the invention's details. Protection in this manner is known as a trade secret.
For example, the drink formula for Coca-Cola has remained a trade secret for generations. There is no patent protection, and therefore no onus on the company to publicly disclose the recipe. Nor is there a limit of 20 years to its protection. Trade secrets work best where the product is difficult to reverse engineer or replicate, and the knowledge can be protected with confidentiality agreements.
4. Protect your idea or brand by registering it
Protect your idea using the IP system to register a patent, trade mark, design or plant breeder's right (PBR). However, make sure you consider the risks and the benefits of registered and unregistered rights.
For example, the two University of Queensland doctors, Ian Frazer and Jian Zhou, who worked for years on Gardasil (a vaccine for strains of the human papillomavirus) took out a provisional patent on their research in early 1991. Three days later they spoke about their research at a conference in the United States. Not long after, a patent was filed in America for very similar research. After a number of court battles, the Australians emerged victorious over the IP, due to the strength and detail in their provisional patent.
5. Be cautious in commercialisation
Where practical, build a model of your invention to help prospective financial backers to visualise your smart idea and its market potential. However, do not let anyone see it without having a confidentiality agreement in place first.
Also, if you have an invention, be careful not to chase money in relation to that invention before lodging an application for patent protection. Commercial use or even an exhibition of the invention before you file a patent application may prevent you from receiving a patent.
6. Track your costs
Keep track of all your development and protection costs to help put a value on your IP and give you an idea of how profitable your venture needs to be to recover costs.
7. Research your market
Research your potential market and understand the likely consumers, buyers, licensees, investors, manufacturers and distributors. This will help you work out your unit cost and should give you a basis to see if your product or service is competitive.
Search the patent, trade mark and design databases to ensure your ideas are new and to avoid infringing the rights of others.
For trade marks, you can use the Australian Trade Mark Search.
For patents, you can use the Australian patent search, known as AusPat.
For designs, you can use the Australian Design Search.
For PBR, you can use Australian plant breeder's rights search.
You should also search for new business opportunities and competitor activities.
8. Get business know-how
To successfully commercialise your idea you need a variety of business skills. Get educated, and also take advantage of support groups such as inventors' associations, your local business enterprise centre and government agencies for assistance.
9. Work out a commercialisation strategy
There are different ways to make money from IP. You can sell it, license it or make products yourself. It might be more profitable in some cases not to manufacture your idea yourself. You can seek professional advice before entering into contractual agreements with others.
10. Beware of infringement
Keep an eye out for anyone who may infringe your IP. They can erode your market share and poor-quality imitations can quickly ruin your brand's reputation.
You might consider developing an infringement strategy and consider IP insurance. There are sometimes factors which you can’t foresee, but you can be forewarned.