After looking at the successes and failures of the past year, you have a better idea of where your team can push in the next 12 months—whether in terms of resilience, revenue generation, profitability, customer satisfaction, innovation , or impact.
You may be looking to make new investments by hiring more talent or implementing new technologies. Or you may be preparing to raise capital to propel your business to new heights.
I would like you to consider another project this year. I would like you to consider investing time and effort into creating or updating your intellectual property (IP) strategy .
We believe that all of our businesses – or almost all of our businesses – have tremendous competitive advantages.
Warren Buffet
Your IP strategy: a competitive advantage to protect your investment
An IP strategy is simply a plan that describes how you will develop, grow, exploit, and generate revenue from or monetize your portfolio of IP assets (e.g., patents, copyrights, trademarks, trade secrets, designs, and data).
It aims to provide you with a competitive advantage ('moat') in the market, as well as to enable you to increase your revenue and profitability. As market conditions change over time, by creating a competitive advantage, you protect the investment that you, your staff and your investors have made in your business.
For example, there may be increased competition in your industry or an opportunity for your product to enter a new foreign market. Having a strong patent portfolio covering key territories can prevent your current and future competitors from manufacturing, selling or using your innovation, positioning you as an extraordinary force in the marketplace.
Developing an IP strategy doesn't have to be complicated.
An IP strategy can be as simple as a one-page overview of what IP assets you own and how you plan to grow that portfolio over time.
By laying the foundation for an IP strategy, you and your business will be able to approach intellectual property as a strategic asset. An IP strategy is inexpensive, easy to develop, and a starting point; you can (and should) review it at least once a year.
As your business grows, develops products, accelerates shareholder database commercialization or expands, it becomes essential that your IP strategy evolves into a more comprehensive document that outlines the following:
alignment between your business and intellectual property;
how you will define intellectual property objectives and establish infrastructure to support your business objectives;
the description of the implementation of your IP strategy.
Additionally, it’s important that developing an IP strategy is a company-wide process. It’s not just a task for the CEO or CTO; it also involves key stakeholders, such as the board of directors and, ideally, your staff.
Remember that intellectual property isn’t just about patents, it also includes trade secrets and trademarks. Everyone in your business who touches some form of intellectual property in their day-to-day operations – from marketing to finance to engineering – will have a key role to play in developing your IP strategy.
The Canadian Intellectual Property Office has published a step-by-step guide on planning your IP strategy. This is a very useful tool to give you an idea of the various elements to consider when developing an IP strategy.
Is an IP strategy really worth it?
My answer is unequivocal: yes!
Again, there is no need to prepare a 100-page document; even a simple one-page document will suffice (at least as a starting point). We have met with representatives from hundreds of companies since launching the IP Asset Finance solution last July, and we have seen the various benefits of having an IP strategy in your company:
Stand out and increase your market share
We met with representatives of a company in the global transportation sector that faces many obstacles to market entry. Despite the existence of competitive or alternative options, the organization was able to secure some major contracts in part because its IP strategy included obtaining patents for its concepts . In a highly competitive process, the company won a contract because the project decision maker opted for a technology that was protected by a patent.
Become more efficient and increase profit margins
Representatives from one software company we met with accumulated large strategic data sets that drove loyalty to the company’s platform. This led to lower customer acquisition costs and churn, as well as higher long-term customer value.
Other excellent examples of this are companies that have accelerated their market entry by licensing intellectual property from other organizations.
When done well, this approach helps companies avoid wasting time and money on researching and developing their own IP and allows them to leverage the IP they have already created and published. Companies with an IP strategy can find potential licensors through ExplorerPI . Data-driven cleantech companies can join a patent collective like the recently launched Innovation Asset Collective .
Create additional sources of income
In the context of COVID-19, we met with representatives of a few medical technology companies that experienced significant revenue declines and needed additional liquidity. These companies conducted comprehensive reviews of their patent portfolios and found ways to license their technologies to other companies, creating new sources of liquidity.
Attract more investment or reduce your tax obligations
Increasingly, venture capitalists and private equity investors are seeing the value in using intellectual property strategies to drive business growth.
In addition, government funding agencies are becoming increasingly aware of intellectual property, and they want the companies they fund to have IP strategies. Then, of course, you can contact us to learn more about longer-term, more flexible, value-added debt or equity financing.
Will developing an IP strategy be your next New Year’s resolution?
The possibilities are endless and the need to think very seriously about an IP strategy is imperative, regardless of the industry or stage of growth of your company.
As we begin the transition to our new reality of living in an intangible economy, I encourage business owners across the country to consider developing an IP strategy as a New Year's resolution.
