When one thinks of setting up a startup, one must look at various aspects of the business, such as the financial resources, competition in the market, and how to go forward with the branding.

Unimaginable Necessity of Intellectual Property in Startups:

as Intellectual property management also poses an essential factor to consider while setting up a startup. The startup’s foremost IP consists of trademarks, patents, designs and copyrights. Startups usually seek protection for their inventions, logos, business names, designs and software. Different types of IP protection apply to these various works. Patents, for example, protect an invention, copyrights protect software, and trademarks protect a startup’s brand name and logo.

IP registered at the start of the business helps the company and its stakeholders better than registering them after the ideas have been published. The IP law is in the form of an asset to the company. The IP helps maintain the individuality of the property which has been registered with the startup and helps keep a check on the competitors from impersonating the ideas and products of the company. 

Why is an IP essential?

The main intent behind setting up a startup is the introduction of a new idea to the market. This new idea can lead small startups to develop into large-sized corporations. Therefore, it is paramount that the ownership of this idea is made intact. Also, the presence of IP rights and their management creates an advantage in terms of competition and also attracts investors. Also, the company can detect whether they are infringing the rights of any other entity and protect themselves earlier from violating the rights of any other entity. 

1.Common errors made by startups with respect to Intellectual Property :

Startups frequently do not prioritize their IP strategy or do not have one at all. Mishandling your IP can doom your startup before it even gets started. The following are the most common and fatal IP mistakes made by startups:

1.1 Not keeping the creators in touch with the decision-makers: As your startup grows, the people who create your IP will eventually be separated from the people who make strategic decisions about how to protect it. Your engineering team, for example, will be distinct from your legal and executive teams. Maintain contact with your creators and decision-makers. The people in charge of protecting your IP can’t protect what they don’t know about or understand.

1.2 Not maintaining confidentiality: A trade secret is valuable IP for startups. The trade secret is only protected if it remains a secret. For example, only two employees know the Coca-Cola recipe, which is a protected trade secret, and the recipe is kept in a vault in Atlanta, Georgia. Confidentiality is essential in both developing inventions and writing patents. It is important to make sure your employees, partners, and suppliers sign non-disclosure agreements to protect your confidentiality. You should also password-protect all computers, restrict which employees have access to which information, and restrict the type of information employees can access on personal devices.

1.3 Failure to conduct a trademark search: Before you begin using a trademark or business name, conduct a thorough investigation to determine whether that mark or name is already in use. The Trademark Electronic Search System is a free tool available through respective IP offices. Suppose you don’t do this before you start building a brand and associating it with that mark or name. In that case, you’ll lose your investment in that IP if you discover after the fact that you’re infringing on another person’s or company’s trademark. Further, the TESS search will alert you early on if your mark is infringing, limiting your losses and preventing reworks.

2.Advantages for the startup by securing IP Rights:

2.1 Possession is presumed: When you successfully obtain legal rights to a copyright, patent, or other type of IP, you create a rebuttable presumption that the property is yours. In other words, if another company infringes on your IP and you sue, the courts will presume that the IP is yours unless the other company proves otherwise. This gives you a competitive advantage in infringement litigation.

2.2 Legal defense against infringement suits: You have no way of knowing whether what you’re using already belongs to someone else if your startup doesn’t go through the process of securing IP rights. Acquiring IP rights correctly protects your startup from costly infringement litigation later on if you discover that someone else already owns the rights.

2.3 The key to gaining a competitive advantage: According to the Startup Genome Project, IP is the essential step in gaining a competitive advantage in your market, which is especially true for tech-based startups.

2.4 Investor appeal and security: If your startup connects with a novel idea or type of software, failing to protect your IP could jeopardize the entire business. IP protection promotes stability and security to investors, who prefer to see startups that have a well-developed IP strategy from the start.

2.5 Government Incentives: Startups and MSMEs are also entitled to a reduced filing fee for patent and trademark examinations. State governments have also started Startup Cells and have introduced incentives such as partial reimbursement of the amount. The primary goal of the programmes and schemes is to help and support startups in raising awareness of IP rights issues in general and, in particular, to educate them about the value and economic benefits of IP rights. 

Conclusion: To succeed, startups must overcome the odds. Startups cannot afford to make costly errors since there is always competition for them. By effectively securing the IP from the start, they may contribute to the safety of their new business and maintain progress. They can protect their startup against legal issues in the future and put themselves in a better position to attract investors, partners, suppliers, and other stakeholders.


  1. Why is IP Protection Important for Startups
  2. How startups and SMEs should think about IP: An investor’s perspective-WIPO
  3. Significance of IP for startups-WIPO

Disclaimer: The present article intends to provide general guidance on the subject, and you can also consult us in your specific case.