Intellectual Property

How To Protect Intellectual Property When Building A Team

“By ourselves, we can move quickly. Together, we can go far.”

An old African proverb that came to mind when writing on this topic.

Ideas aren’t meant to be confined to a single mind. They’re meant to be shared and formed into a common vision. I’ve seen many entrepreneurs with good ideas afraid to share their good ideas with others. They either believe that they can do it all themselves or, more often, fear misappropriation, loss of ownership, and competition.

As a result, they remain soloist amongst teams, undertaking the task of building a company with a fraction of the resources they need to realize their visions. Very few have succeeded as soloists… come to think of it, no one comes to mind.

This article hopes to provide those entrepreneurs with a means to ease and mange what I believe to be the most common cause of the soloist entrepreneur – the “I don’t want to share my idea mentality.”

Collaboration is a right of passage for entrepreneurs. It is the natural transition from a single person’s idea to a team mission of realizing a collaboratively improved idea. This right of passage represents the entrepreneur’s becoming of a leader.

As an Intellectual Property Attorney, I would encourage collaboration because it is a much more certain path to an ideas successful realization of an idea. But, as that same Intellectual Property Attorney, here is the order in which I would recommend your approach on – of course – an entrepreneur’s shoe string budget:

  • File for IP Protection – You can file these under your own name, claiming exclusive ownership. But a good strategy and incentive for building a company with committed team players is to license and assign the rights to the IP to your company. Now, everyone has some skin in the game and everyone is equally protected. Often times, you can first license the idea to your company, reserving the right to revoke the license if your team members don’t follow through with their contributions.

  • Don’t be afraid! Share your idea with those you trust. Get their feedback. Build their support. Start to build a team. So what if the idea ends up being not all yours and only yours? You’ve got a team! Now, I’m not saying to share your idea with big corporations. Rather, I’m suggesting that you reach out to your personal and professional network with your idea.
    • Pros: By adding more minds into the mix, you begin to build an idea into something worth protecting and pursuing. More importantly, in the process, you’ve enabled those collaborators to feel ownership in the idea – which I find to be the best motivator in getting people to help you realize the idea.
    • Cons: Your idea is completely unprotected at this point, and you aren’t asking ones you trust to sign a Non-Disclosure Agreement. Keep in mind though – this trustee may always betray your trust and steal away with your idea… and they law doesn’t provide you with any recourse to claim that idea as yours in such circumstances.

  • Solidify your commitment to the idea and, preferably, with a team sharing a common vision for the idea. Before spending money on forming a company and securing your intellectual property, you want to make sure you (and the rest of the team) are committed to realizing the idea. As a patent attorney, there is nothing that makes me feel worse than having my clients pay me for a patent on an idea that they don’t end up realizing.

  • Craft a Customized Non-Disclosure Agreement and IP Assignment Agreements – Not the template kind. But the kind that ensures that not only are your disclosures protected in confidence, but that any ideas that the recipient may derive from your disclosures are subject to your first right to use and ownership. Sometimes, this agreement is reached in exchange for reasonable compensation for the contributions. Having an NDA will enable you to reach out to individuals, contractors, and entities that you may need to contract with or employ in order to realize your idea. Without such an NDA coupled with an IP Assignment Agreement, you may reserve your IP rights, but will not have any rights to the contributions made by those who you’ve shared your idea with!

If you are interested in more detail related to your situation it is best to speak with an attorney.


Andrei Tsygankov is the Co-Founder and COO of SmartUp® and a partner at Founders Legal (Bekiares Eliezer LLP). As an attorney, Andrei specializes in corporate, commercial, trademark, and international business matters.

Source: Smartup Legal