In the first part of our innovation series, we examined the concept of capturing, leveraging, and growing intangible assets for small and medium sized businesses. We care about innovation as it is at least eighty percent of your company’s value — more if you are a startup.
In our work, we unfortunately have seen some colossal blunders with intangible assets. To successfully monetize your valuable intellectual property (IP) requires a firm commitment to the following:
Tip #1: Regular Review– Particularly Trade Secrets
Many think that filing for protection is all that is needed for an IP strategy. However, sometimes the best way to protect your IP is to keep it as a trade secret. That requires diligence with employee and contractor confidentiality provisions.
You risk your entire business if you do not regularly review all your innovation and seek professional advice on the type of protection.
Tip #2: Documentation Matters
Whether it’s a trademark usage dispute, a patent troll letter, or a software code review for acquisition, proof of ownership or first use is important. Developers often think that they do not have to read open source licenses.
Reading licenses and keeping track of all documentation for inventions or code development will matter when you raise money or sell.
Tip #3: Check for Permission
How many times have you heard about companies being fined for using someone else’s song, picture, or video? Copyright infringement is serious and ignorance is not a defense. Again, read the licenses and ensure that you are not using others’ works without permission is not optional
Don’t forget the flip side and as your brand grows, create process to police your own logos and IP.
Tip #4: Bring Your Own Device (BYOD) Policies
If employees and contractors are bringing their own laptops or phones, issues around storage, file-sharing, and trade secrets can crop up. Don’t risk your business — have solid agreements for anyone working with your confidential information. In addition, creating data use, email, and confidentiality policies within a handbook can mitigate problems.
Tip #5: Education, Education, and More Education
Employees and contractors alike must not only sign policies but also understand the value of IP. The management team must understand the value of IP and integrate education into the onboarding process plus regular updates. Remind departing employees of confidentiality and other provisions that will survive beyond their employment during an exit interview.
If all employees know how to spot IP and other legal issues, business risk is minimized while value is maximized.
Our new Enterprise Risk Management Software can assist with spotting some of these potential pitfalls and providing education. If you are in need of an innovation program or review, please contact us or learn more here.