Why intellectual property (IP) strategy can mean the difference between life and death for a startup

In the high-stakes world of entrepreneurship, a business’ survival might hinge on a simple question: Who owns the innovation? 

Copyrighting an original work, trademarking your brand, and patenting a novel technology or device isn’t just about securing your innovations – it ensures that your business can withstand challenges from competitors.  

For startups, this is especially critical. Unlike their corporate counterparts, they do not have deep pockets and a legal team to endure prolonged court battles. Having intellectual property (IP) is not a luxury – it is a defence strategy.  

For tips on how to develop an IP strategy, hear from our experts, Ms Low Jin Wei, Senior IP Strategist at IPOS International, a subsidiary of the Intellectual Property Office of Singapore (IPOS); and Ms Tricia Chong, Deputy Director at SGInnovate’s Investments team.  

Ms Low, IPOS International: The C-suite should be the first people formulating an IP strategy. Lawyers can help businesses gain a basic understanding of their IP rights, but a lot of intangible assets such as trade secrets are things you can manage on your own by putting in internal systems and processes.  

One way is to consider appointing an IP manager to keep track of intangible assets. For example, if your company works closely with patented databases, it can be useful to pick up some fundamentals so you can complete these searches in-house, because outsourcing can be costly in the long run.  

When you hire interns, we do not recommend involving them in the core part of your project or product. Also, make sure they have proper IP assignment clauses in their employment contracts, so they are obliged to confidentiality. 

At IPOS International, we run legal and business clinics, which are resources businesses can tap for advice or clarification.  

Ms Chong, SGInnovate: If the startup is very small, then it’s primarily the core team – the founders. If the team is larger, the founders will work very closely with a division of specialists.  

There is also the opportunity to outsource talent, but before that, what’s important is to plan out your strategy and align it with your business objectives. For very small start-ups, it will always be an iterative cycle, going back and forth to decide what exactly will work for the business.  

If you are building platform technology, you have to consider not only what your business is about in the here and now, but also the potential of the technology and where it could go. Startups tend to pivot, and you might later realise that you did not cover yourself properly in the patent you filed. 

IP lawyers are mostly there to help you file and prosecute patents, and are not necessarily the ones who would be litigating. But it is not a bad idea to have a basic conversation with them on what it means when you encounter a contentious situation.

Ms Low: IP strategy is beyond just a legal tool – it is a business consideration. Consider the case of a startup that has not thought about IP. They may have just launched a product they created without protecting themselves in any way. They either run the risk of infringing on others’ patents, or having people copy them – and they’ll have no way to stop the infringers.  

One example is the tug-of-war between Apple and medical technology company, Masimo. Masimo had patented its pulse oximetry technology and accused Apple of stealing it. In the end, Apple had to pull two of its Apple watches off the shelves and roll out new versions without the patented technology. While big players such as Apple can afford to engage in such legal tussles, startups may face a huge financial burden that makes it difficult for them to survive.   

Ms Chong: IP is not just a defence strategy but can also make people feel appreciated that they have contributed to the IP. That will motivate them to continue their innovation and bring more new and interesting things to the company, building its IP portfolio.  

Ms Low: If you have a small IP portfolio, we recommend doing an annual review at the minimum. Bigger companies can afford to do it on a weekly or monthly basis.  

There can be a disjoint between IP timelines and when you enter a market. Once you miss the filing deadline, you miss it forever. Thus, the process needs long-term planning. I once spoke to a company that patented their technology but got their commercial product only a decade later. When they wanted to enter certain markets, they realised their patents were not protected for those markets, and could not enter when they wanted to.  

Companies need to understand when to file and renew a patent, which normally lasts for 20 years. This will help them plan their business entry strategy as well. Trademarks are more flexible, as there are no novelty requirements, and can be filed before entering a market. 

Ms Chong: They should have some sort of administrative system, and set milestones to check in with the team, which will keep communication channels open. I know of founders who were constantly innovating, going from versions one, two, to three, without knowing when to file a new patent application. That’s where a proper log of conversations would have been useful, allowing them to understand at which point the innovation had kicked in.  

Companies producing white-label products sometimes safeguard their IP really tightly. Where they file their IP is important – they have to identify their largest markets. Financing patents can be a heavy investment, but if they do not get their IP properly covered, others might steal a piece of the pie. It is very important for startups to think hard about their next moves and how they pace the development of their innovation.  

Always be watchful of what is happening out there. Publications are important, because they tell you about activities relevant to your business. Those who subscribe to the Institute of Electrical and Electronics Engineers (IEEE) or Lifescience Industry News will be alerted when something has been published.

Ms Low: You should search through patent databases to understand how your competitors’ invention compares with yours. Knowing your competitors or potential partners would be important for you to decide if you should go ahead with a partnership.  

When licensing patents from universities, you can get an exclusive license. You pay a little more, but can be assured that this piece of technology is not going to someone else.  

Ms Chong: Similar patents that cover the same scope and are alike are knockout patents. What you can do is to look at how you could find avenues to collaborate with the other party. 

Find out more about SGInnovate’s resources and support for Deep Tech startups here.