Insights from Alejandro Cremandes Newsletter: IP Companies

February 21, 2019

Alejandro Cremandes is a fountain of knowledge for startups, and we were pleased to see this come into our inbox. Here are some of his tips–with our additions–on Setting up, running, and monetizing an IP-Backed start-ups. (you can read more of his work here)

"Understanding the Value of Intellectual Property

Intellectual Property defines the broad spectrum of intangible assets arising from innovation, novel ideation, and human ingenuity.

IP encompasses original concepts and creative output that innovators must secure with Intellectual Property rights.

Getting legal protection ensures that you have complete control over the use of the intangible assets you develop. That’s how you can monetize them profitably.

Entrepreneurs can legally acquire patents, trademarks, copyright protection, and trade secrets security.

These types of intangible assets shape the entrepreneurship landscape, with lawmakers working to raise awareness of the importance of securing IP.

Legal protection can help you prevent competitors from using your innovations without authorization and/or illegally copying them.

You’ll get patents to secure an innovation, while trademarks are effective deterrents for copying the company’s brand name and logo.

If you’re developing technology, cloud applications, and software, you’ll get copyright protection.

Consider legal rights as a must-have form of insurance. Not only will you protect the brand identity and product design, but you’ll also evoke confidence in investors. Ensuring product-driven traction is yet another positive."

This is exactly what Andy and I did in 2015, and have followed this process ever since. Our vision is to license you our IP and allow you to invent and create your own IP on top of, alongside or below our IP. Our seminal patent was created to allow us to build a Social Identity of Objects network without the fear of being sued. Now we are licensing that IP out to others who have similar dreams.

"How Intellectual Property Can Shape a Startup’s Success

The key differentiating factor for any new startup is an innovative business idea that addresses a problem. This problem can be as yet unrecognized or underserved.

Or, existing solutions may be ineffective or not economical enough to make sense to the customer.

Founders can bank on Intellectual Property legal safeguards to protect the cornerstone idea that forms the base of their startup.

The intangible assets the company possesses add to its value, much like tangible assets like real estate and equipment.

Applying for legal protection typically involves researching existing companies that might have come up with the same idea.

Identifying existing copyrights and patents will help you save on the resources you would have diverted toward developing the MVP.

You’ll also avoid the possibility of incurring fines and penalties for infringing on IPs belonging to other companies.

IP protection presents barriers to prevent competitors from replicating groundbreaking ideas, which can dilute your startup’s market position. It ensures that you maintain that distinctive niche that gives you an edge.

Customers use the brand name to identify and recognize products that are good value for money. They’re also likely to prefer your brand consistently and stay loyal when you release new offerings in the market.

Not only will you minimize churn rates, but IPs and trademarks ensure lower Customer Acquisition Costs. Intangible assets can prove to be sources of long-term and regular revenues.

In this way, IPs in a startup’s portfolio are attractive features that build up a compelling pitch deck.
Attracting funding for your startup will be easier since the IP reflects well in the valuation process.IPs also indicate the founder’s commitment to innovation and business acumen that is worth backing in the long term. Investors are more likely to offer you funding and mutually beneficial partnerships."

You may have your own IP already, inventing with us allows you to create Social Identity of Objects IP for your own use case without any barriers to entry. This should improve your valuation and also protect the technology–software, business model–that your business is built on.

"Eliminated Competition

Since the IPs have legal protection from copying, the ideas remain unique and original, which adds to their value. Basically, you’ll eliminate the competition by getting protection from rivals replicating the designs.

Since brand names and logos are critical for recognition and customer loyalty, you’ll safeguard them with trademarks.

Getting copyrights ensures that competing companies acquire legal authorization before using the creative assets. As a result, copyright owners maintain complete control.
Entrepreneurs can also get protection for their trade secrets, such as customer data and proprietary algorithms.

That’s how they can maintain their position in the market and the value of the IPs they innovate."

Competition, competition, competition. Having competition is good. It drives you, it provides some proof that there is a market worth fighting for–and in some cases–they may even become good merging partners. Having licensed or owned IP helps secure your position in the market and can be a differentiating factor in who wins in the end.

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