Protecting your rights the world over
The first thing most tech start-ups think about is protecting their new product and brand, be it for a new app or software or a gadget. It’s important to ensure that a product and brand is, and remains, unique, particularly with so much innovation in the sector. However, the cost of trademarking a new tech brand worldwide is hugely expensive.
Ask yourself where your product is being marketed, because you only need to protect it there to start with – and sometimes not even then – at least until you are sure the brand will be crucial to the success of the innovation and is worth spending the money on. It’s surprising how many companies come for advice on protecting an idea, a brand or an innovation without having checked if its already on the market or if they need and can afford the worldwide protection they have come for. It’s usually not needed early on!
Who owns the whiz-bang
You may have had the brilliant idea, but it’s often the technical expertise from contractors which allows the actualisation of a successful tech proposition. Most tech start-ups will have had some help to develop a new product, particularly when it comes to coding new apps and software.
That means if you use a supplier to develop a part of your product, they will own the rights to that part unless agreed otherwise. To avoid major issues down the line, clarify the intellectual property of any supplier or development partner and make sure this is something you own.
Mixing business and friendship
With the potential for anyone with a computer to develop a new digital business, there’s a good case for partnering with your friends. However, failing to clarify the legal nature of your partnership could create big problems in the future.
Facebook, as depicted in the film “The Social Network” is just one of many examples! It’s vital for start-ups to establish what the contribution and ownership of each partner is and what the expected input is going forwards, and as difficult as that may be to discuss with your friends (or relatives), it’s an important step to secure the future of your business.
Life changes (marriage, gambling, children or whatever) should also be considered as far as any potential impact on the business.
The tech business is global! Even the smallest tech companies often have founders, partners and eventually employees from many places in the world. Sorting out rights to work, visas and payments can be costly and time-consuming – and it pays to seek advice early on. This may be necessary to secure financing as well as complying with the law.
As any Dragons Den viewer will know, a great business idea is nothing without a good business plan to secure finance. One big mistake many companies make however, is asking for too little. Investors need to have confidence in the growth of a new business, and the potential for their return. While every little may help, approaching a small number of investors for a larger contribution will often produce better results.