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Protecting Your Idea
 

Protecting Your Idea

Welcome to the 40billion.com startup guide to protecting your idea. This simple guide is for new entrepreneurs and individuals who believe that they have a great business idea and want to protect their intellectual property. Use this startup guide to learn how to protect your intellectual property - also known as IP, ideas, or creative works - before pitching, networking, or hiring. You can protect your IP through patents, trademarks, copyrights, and non-disclosure agreements. Includes templates for creating an invention disclosure form and a non-disclosure agreement (NDA).

The first thing you need to know is that you are not alone. The shift from large companies to smaller companies is a trend that has been underway for many years, and the shift is due to many factors, including large company layoffs, veterans returning to the work force, people looking for a second income, and those just excited to provide a product or service that fills a need in the market. Being your own boss can be a rewarding experience, but it has never been more important for you to consider patenting your idea or registering your name as a trademark, especially if you are a small business owner or you're starting a small business.

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Ok, now the important part that our lawyers made us add: The information provided in this overview of intellectual property protection is not meant to be a comprehensive exploration of all the various forms of intellectual property protection and implications, and it is not intended to be legal advice in any way. We strongly encourage you to seek legal counsel to help you go through these choices in more detail and advise you as to the best option for your particular circumstance.

Ok, with that out of the way, let's get started. One of the most important decisions that you will make regarding the start of your new business is how you protect your idea or product. This is especially the case if you're developing a new technology, design, or even a creative work such as a musical performance, a book, or a film.

So, what is intellectual property, and how can you protect yours?

Intellectual property, or IP, is just a fancy term for something that you create with your mind. It includes things like inventions, creative works, symbols, names, images, and designs used in business. For example, if you have a new idea for a product that does not exist anywhere else, and you intent to start a business to create and sell that product, then you idea might be considered your intellectual property. And you might want to protect it from being stolen, created, and sold by others.

In broad terms, there are 4 common ways to protect intellectual property, and we will talk briefly about each. The four ways are:

Patent
Trademark
Copyright
Non-Disclosure Agreement

What is a patent? According to the US Patent & Trademark Office (USPTO), a patent is the grant of a property right to an inventor. Patents are granted for new, useful and non-obvious inventions for a period of 20 years, and they provide the right to exclude others from exploiting the invention during that period. Basically, a patent can prevent someone from stealing, producing or selling your invention or design without your permission, or without paying you for it. In the U.S., the USPTO is the agency where you could file for a patent, and the average cost will run you anywhere from $2,500 to over $10,000, depending on the size of your application and the size of your business. The filing fees charged for small businesses are usually less than those for large businesses, and then of course attorney fees are additional. It might be worth it though to shell out the cash to patent your invention and protect your investment for up to 20 years.

A trademark, on the other hand, is just a brand name. Trademarks protect words, names, symbols, sounds, or colors that distinguish products and services. Trademark rights may be used to prevent others from using a similar name, for example, but not to prevent others from making the same products or from selling the same products or services under a different name. Unlike patents, trademarks can be renewed forever as long as they are being used in business. In the U.S., the USPTO is the agency where you could register a trademark, just like patents, but the average cost to register a trademark is way less at only $300 to $600.

A copyright protects your creative works - things such as writings, music, art, and movies - from being used, copied, distributed or presented without your permission. In the U.S., copyright protection is automatic once you create the work; however, The Library of Congress registers copyrights which last for the life of the author plus 70 years. That's a long time.

A non-disclosure agreement, also called an NDA or a confidentiality agreement, is a legal contract between at least two parties - usually individuals or companies. And the NDA outlines confidential information that the two parties want to share with each other but keep secret from others. Basically, an NDA is an agreement not to disclose certain information to others, and it's used to protect confidential business information, including for example a new business idea that is not publicly-known.

So, we hope that we have helped you to better understand 4 ways to protect your ideas - patent, trademark, copyright, and non-disclosure agreement - and that you now have a better understanding of some advantages and disadvantages of each.

For more information, check out these templates:
Sample non-disclosure agreement
Invention Disclosure Form


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Protecting Your Idea