For many UK business owners, the idea of intellectual property (IP) couldn’t be further from their minds. Most believe it’s something that doesn’t hold any value to them. After all, only large innovative companies within the tech sector need to be worried about their intellectual property – right? Wrong.
What is IP and does my business have any?
In today’s digital age, up to 80 per cent of the value of UK companies is made up of intangible assets, such as intellectual property. But what actually is IP and how can it benefit your company?
There are many common misconceptions about IP: “Only big companies like Apple and Samsung have valuable IP” or “it’s only for those in the tech or healthcare sector” are two I hear time and time again. In fact, this couldn’t be further from the truth. If you are a business owner, the chances are your business will own some form of IP, no matter your size or field
In the simplest terms, IP protects your company’s creative output such as its name, logo, products (including names, design and packaging), website design and website content. These assets are protected by different types of rights, trade marks, patents copyright and designs.
Why is it important?
As your business grows the value of these rights will grow with it so its vital to identify them at an early stage. If your company is building a brand it should seek to register the name as a trademark. If it is creating new products, these can be protected by registering designs to cover their shape or patents to protect how they work. Copyright protects everything from web design, blogs, tweets to surface decoration of clothes, books and plays. Even databases can be protected.
Once identified and appropriately registered your IP becomes an asset that can be licensed or sold and protected by law i.e it has real value.
US businesses do not dream of raising funds without having appropriate IP in place and UK businesses should adopt the same mind-set. Having a good IP strategy from an early stage will add real value to your business when you are looking to raise funds or sell.
What do I need to do?
Start by establishing exactly what IP rights you already have. The Intellectual Property Office has a great online IP health check that you can use to audit your business. If a fuller investigation is required, we advise you instruct an IP professional.
Next make sure that when it comes to creating IP, you keep thorough records of who did what, when. These can be used as evidence should you be involved in any legal disputes. Prior to registration, only disclose details of your IP in confidence.
Most importantly, create an IP culture within your business. Make sure all employees understand the importance of IP and the issues surrounding it. Whether you dedicate one person within the business to oversee the registration and protection of IP, or you outsource this role to an IP professional, the money you spend will be a sound investment in the future growth of your business.
Lastly, to ensure your ideas are fully protected, look into purchasing intellectual property insurance. What many business owners fail to realise, until it’s too late, is that simply owning intellectual property rights will not stop others attempting to steal it. What it does do is give you the right, in law, to stop copycats. IP insurance will cover the significant costs of taking legal action against infringers, allowing you to build your business with confidence.