One of the most significant assets of a startup is its intellectual property portfolio.
For better or worse, Israel is considered a startup country. Thinking outside the box (one of the characteristics of innovation) and rebellion against conventions are imprinted in the Israeli DNA. Hundreds of Israeli startups have revolutionized many technological fields – and some have even become Unicorns.
One of the most significant assets of a startup is its intellectual property portfolio. This portfolio can include various assets such as patents, trademarks, designs, copyrights, etc.
The startup has different stages of development that include (in most cases) a modest start (at least in terms of budget and human resources), and different stages of development (including technological and financial milestones) in which the startup is supposed to grow and expand its intellectual property assets. The importance of accompanying startups stems from the need to adapt the intellectual property to the needs of the startup and its constraints.
At all stages, it is important to carry out a periodic assessment (preferably with a patent attorney) of the intellectual property assets and how they can be protected. Considerations include, for example, the budget to be allocated for protection, whether information can be kept secret even after the product is released to the market, whether it is even possible to discover that a competitor is copying the invention, whether the design is mature or not.
As a rule of thumb, it is advisable to register the intellectual property as quickly as possible and document ideas that were used in the start-up in an organized and reliable way. Thus, for example, in registering a patent there is no need to wait for proof of concept or production of a working prototype, and a patent can be filed even before final formulation of the idea.
The nature of the startup can be a decisive factor in building the strategy of intellectual property. For example, companies based on business models tend to file fewer patents than companies based on technology – especially in the area of deep tech. Companies whose business model is based on licensing (e.g. IBM) will tend to file more patents.
Intellectual property laws are adapted to the growth stages of the startup. There is no obligation to file registered intellectual property in all countries of interest to the startup simultaneously. Some of the filings can be postponed – as long as they are filed within a specified time frame. Delaying allows the startup to spread out the expenses over time and consider whether after the first filing additional filings are indeed necessary. For trademarks, there is an international treaty that can be used to save direct submissions in every country of commercial interest. Patent laws also allow the filing of a provisional application in the United States (less formal than a regular patent application but it must contain an appropriate technical description of the invention) and convert it after about a year to a "formal" patent application. It is also possible to file an international patent application that grants a period 30 months (from the priority date of the application) for filing applications in relevant countries.
Proper protection is of great importance at the stages of raising capital and issuing on the stock exchange. In many cases, investors will not be aware of the exact details of the patents or patent applications under examination – but in most cases, they will notice the lack of any protection or the lack of geographic deployment of intellectual property.
Our firm specializes in accompanying startups in the fields of patents and intellectual property