Intellectual Property (IP) infringements cost SME businesses an average of £30k to £500k. So, who is really making money from your ideas; lawyers, competitors, or you? Business mentor and Founder of startup mentoring business, Trove, Carl Stanton outlines what IP means and the importance of making your business ideas work for you, and Rebecca Kelly, commercial lawyer and Co-Founder of shizl discusses why it matters legally for your business.
IP is arguably the single most important unique selling point of your business. It’s the ‘why’ behind every reason you set up on your own. So why are so many entrepreneurs failing to protect their big idea?
Carl explains, “If you’re developing deep tech, novel algorithms, or anything that could be licensed or acquired based on uniqueness, then stolen IP can cause serious damage. In these cases, patents, NDAs, and clean documentation are critical.”
He continues, “Startups building defensible technology, particularly in hardware, biotech, AI, or scientific IP, face the highest risk. If you’re working in those sectors and not protecting core inventions, you’re on unstable ground.”
“For most other startups, the greater risk is invisibility, not imitation. Ironically, many corporate businesses move too slowly to be a real threat; they might admire what you’re doing, but they’d rather buy it or partner than copy it.”
What Does IP Cover?
1. Trade Marks
Your logo, logo mark, strapline, and colour palette are all unique to your business. Your product packaging helps you stand out from the competition. It is vital that you protect your brand identity. Registering a trade mark gives you exclusive rights to use your brand in your sector, preventing others from copying or imitating your branding. This is essential for building customer loyalty and a strong brand reputation. Registered designs also elevate your brand and demonstrate your commitment to your sector.
2. Copyright
Copyright protects original creative works. While copyright is legally granted upon creation, SME owners should document the creation process as ownership is key to commercial gain. SME owners should protect their website content, marketing materials, software and digital platforms, artistic works, and written materials. Copyright gives entrepreneurs control over how their creative work is used and distributed, preventing others from copying it without their permission. It is a fundamental way to protect the “know-how” and creative effort that goes into a business.
3. Patents
Patents protect new inventions, including new products, technology, machinery, new processes an entrepreneur may have established, or a new chemical or substance composition. A patent grants the inventor a monopoly for around 20 years, preventing others from making, using, or selling your invention without a license. This is crucial for recouping the investment in research and development and maintaining a competitive edge.
When to Act
Carl suggests when entrepreneurs should protect their intellectual property: “Protect your brand the moment it matters; when you’ve put it on your pitch deck, website, or product. That includes your name, your logo, your domain, and your strapline. These are the assets customers remember and recommend. Trademarks should be filed early if you’re confident in the name. File patents if your technology is genuinely novel and commercially valuable. Use NDAs when sharing sensitive or non-obvious information. You don’t need to cover everything on day one, but don’t wait until you’re in the room with investors or corporate businesses to discover that someone else owns your name.”
The Legal Reason
Rebecca Kelly, Commercial Lawyer and Co-Founder of shizl the accessible and affordable legal document platform explains why IP is so important for businesses. “Ideas for businesses come from innovative entrepreneurs who have identified a problem and found a solution. It is only right that the creators of businesses get the credit and benefit from the foundation of their enterprise. In my 20 years experience as a lawyer I’ve seen many business owners lose out as they have not protected their IP. When they have come to exit the business, they have found out the value of the business is a lot less than they assumed as they have not properly protected their IP, and in some cases, don’t even own the IP they are seeking to sell! I’d advise any business owner to protect their commercial business assets and IP so they can be confident they will be properly rewarded financially for their innovation and hard work.”
Final Takeaway
Don’t let IP slow you down, but don’t ignore it either.
- Prioritise protecting your brand early. Names, logos, straplines, and domain names are cheap to protect and painful to lose.
- If you’re building novel technology, start documenting it early and speak to an expert about patents when the time is right.
- If not, focus on speed and visibility. Momentum is your moat
Use shizl! Having your legal ducks in a row can give you the essential protections early on without the high legal costs. Use shizl to ensure your IP is properly protected.