Startup IP Mistakes That Can Cost You Everything – Part One
Whether it’s out of haste, budget pressure, poor guidance, or just not knowing what they don’t know, early missteps around intellectual property (IP) can have long-term and sometimes irreversible consequences for startups and SMEs.
In Part One of our guide, we examine the first two of five common IP mistakes early-stage ventures often make—and how to avoid them to build a future-proof IP position.
Mistake #1: A “Fire and Forget” Approach to IP
Many startups rush to file patents or trademarks early to tick a box for investors, boards, or advisors. While early protection is often essential, IP should never be treated as a static one-time task.
Why it’s a problem:
IP isn’t a “set and forget” exercise. Your commercial strategy evolves—so must your IP. If left unattended, your IP rights may no longer align with your offerings, competitors may get the upper hand, and your assets may be poorly positioned to support due diligence, funding, or expansion.
What to do instead:
Treat IP as a living, breathing business function. Allocate quarterly time to:
Audit filed rights against current offerings
Confirm all IP is properly assigned by team members and collaborators
Avoid premature public disclosures of new developments
Review competitor IP activity and conduct FTO (freedom-to-operate) checks
Update your IP attorney on market expansions or strategic collaborations
Just a few hours per quarter can protect your most valuable intangible assets.
Mistake #2: Inability to Communicate Your IP Position with Confidence
Too often, founders assume their IP attorney can handle tough questions from investors. But legal privilege limits what attorneys can say—and when.
Why it’s a problem:
Time-sensitive scenarios like due diligence require clear, confident answers. Waffling, defensiveness, or uncertainty can erode trust and kill a deal.
What to do instead:
Invest in IP education. Founders and team leads should understand and be able to explain:
What IP rights exist, their types, where they’re filed, and current status
Basic understanding of prior art, freedom-to-operate, and timelines
What can be disclosed safely, and what requires legal advice first
“Pro tip: If you’re pushed for sensitive details—pause. Let the third party know you’ll consult your IP attorney first. It shows professionalism, not avoidance.”
Coming Soon: Part Two
In our next post, we’ll explore three more common traps SMEs fall into when it comes to IP—and how to sidestep them like a seasoned operator.
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