2 minute read
Any aspiring entrepreneur or start-up needs to have Network Ten's Shark Tank on their regular watch list. And here's why.
Not only does it hold up a mirror to the sometimes naïve ambitions of the candidates, but it can point out some business basics that you have to get right.
The critical importance of intellectual property rights for a business came into clear focus in a recent episode of the Australian series.
One of the candidates pitched for investment in their food delivery business. The question came from Janine Ellis, “Do you have a trade mark for your name?” and the business owner stared blankly back at Janine. “This could be the determining factor as to whether you receive an offer from the sharks”, responded Janine.
The brand of the business that was pitched was extremely generic and descriptive. In trade mark land, this is the type of brand that is extremely difficult to own, as a trade mark - once registered - is providing you with a monopoly over a brand for particular goods and services.
The added difficulty for the candidate was that whilst the idea of the business was a good one, a concept cannot not be ‘owned’ and therefore other traders cannot be stopped from adopting a similar concept. Given that the brand was not distinctive either, the sharks could see that there was nothing concrete that they could monopolise and prevent others from copying. As a result, even though the business might have been first to market, it would be difficult to secure and therefore defend the commercial position of the business from future competitors.
Accordingly, it is important to develop a business concept with registerable elements in mind. This can set you apart from the competition and more importantly enable you to defend your market position when the stream of competitive businesses emerge.
Using Janine as an example, as of today, the company that Janine founded, Boost Juice, owns over 100 trade marks in Australia alone, and presumably many other intellectual property rights.
Why is that important? For a number of reasons. Take the example of Boost Juice. The idea for her business, a smoothie bar, is not overly unique or different. What is different is the brand, set up, systems and processes that have made her business a success. There are a number of legal rights that can be identified in Janine’s business based on trade marks, copyright, and confidential information.
Identifying and securing these rights prior to establishing a business assists business owners in a number of ways; where someone obtains a domain name licence for a word that is similar to your brand, adopts a similar brand or logo, uses your systems or processes, reuses your software, if an ex-employee takes confidential information, or if you plan to franchise your business. And should you be looking to sell, a solid portfolio of intellectual property rights will undoubtedly command a premium from an investor.
In a start up environment - or even established businesses - it is important firstly to conduct searches to ensure that the protectable elements of your idea are not the same or similar to an existing business. Then identify the rights that you may already have, rights that could be registered including those rights that need to be secured before disclosure to the general public for protection to give you a competitive edge.
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