Top Three Tips for IP in a Tech Start-Up

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There are a lot of moving pieces when planning to launch a technology small business. It makes good sense to have the Intellectual Property (IP) of the business play a key role in the overall start-up strategy. After all, the last thing you want in this process is to be threatened with a patent infringement lawsuit, digital piracy, etc. How should technology entrepreneurs and start-ups approach the difficult task of balancing IP protection vs. marketplace considerations in the quickly evolving global economy? In the face of recent global financial meltdowns, migrant refugee crises, threats of terrorism and regional upheavals (e.g. BREXIT), things may become increasingly more challenging to navigate alone. In terms of IP, the key question for many high-growth start-ups is how to negotiate the daunting landscape of protocol, jurisdiction and regulatory compliance requirements for each new market that their product or service intersects with. Here are the top three tips in protecting your IP investment when launching a tech start up:

Where Do They Click to “Click” With Your Business?​ – The digital world has ushered in a shift from transactions to a more technological interaction model. This means companies need to carefully plan the steps their customers will take to hire and use their product or service on both computers and SmartPhones. According to Constellation Research Principal, Andy Mulholland, “Three distinct types of time-zone based interactions can be recognized in this new environment. They comprise of: reflex interactions (e.g. autonomous machine to machine interactions); service based interactions (i.e. multiple, coordinated services interacting to deliver value to customers / subscribers / end-users); and finally, cognitive interactions (delivering enhanced value as part of a ‘smart’ system and ecosystem).

More Contingent Workers​ – A second consideration involves balancing freedom with basic worker protections. Bloomberg News reminds us, in the so-called “Gig economy,” which offers short term roles for large numbers of contingent workers (popularised by the likes of Uber, Airbnb and Amazon), because they promise a greater degree of freedom and flexibility than traditional employer/employee models. The new Gig Economy players typically offer a platform for exchanging goods and services, but what remains unclear is what determines when a staff is a full-time or part-time employee entitled to workplace benefits and protection laws such as Family Medical Leave Act? This blurring of lines could be interpreted by many as an attempt by platform operators to save lots of resources by lowering Human Resources costs, and this has led to a growing number of high profile lawsuits. Another recent issue was when workers at Deliveroo went on strike to protest their treatment. Such disruptive business practices bring to mind the threat posed to traditional content industries by file sharing platforms such as: Pirate Bay,Napster, Grokster, or Megaupload, who all got sued for their IP repeatedly. A middle ground must be found where it will be possible to explore the boundaries of the new Gig Economy without trampling over the rights of its participants. The winners may become the employers who figure out creative ways to make their Gig workers happy. In conclusion, when it comes to startup entrepreneurship in today’s world, it takes a certain level of awareness to negotiate the maze of challenges facing new tech start-ups in many US markets. One of the key criteria for success, (in addition to having the right ideas, resources, team and opportunity/timing), is developing a solid strategy for intellectual property as part of the overall business model.

Role Reversal​ – IP is a moveable feast, and sooner or later any proponent of “free-to-use” IP soon become vigorous advocates of IP protection once they start producing their own. According to research done by Harvard University, nations that were once net consumers of IP, with scant regard for anti-piracy measures, will often become rabid defenders of international IP laws when they start producing more IP than they consume. The same applies to startups who initially think nothing of appropriating other people’s IP in other to create or enhance their own products / services, but then go on to spend oodles of funding money with top IP lawyers to protect or defend their IP as they mature. Don’t try to navigate IP in the tech jungle alone! Call one an experienced Intellectual Property and patent lawyer Naperville IL relies on.

Thanks to our friends and our contributors from The Law Offices of Konrad Sherinian for their insight into tips for intellectual property in tech startups.