An important corporate goal for any enterprise should be developing and culminating its brand through the use of intellectual property. Owning intellectual property is a key asset that can boost marketability and overall profitability for your business.
So what exactly is intellectual property, anyway? Intellectual property is a commercially valuable product of the human intellect, such as: inventions; literary and artistic works; designs and symbols; and names and images. When used in commerce, such assets may be protected under state and federal law. The three most common types of intellectual property are trademarks, patents, and copyrights. In a nutshell, a trademark is simply a source identifier for goods and services (i.e. a word, slogan, symbol, design, sound, color, or smell); a patent protects inventions (i.e. solar panels & engines); and a copyright protects original artistic and literary work (i.e. songs, movies, books, commercials, etc.).
Each type of intellectual property is used separately to provide property rights. For example, the intellectual property that Apple owns for its iPad would likely consist of: a patent for the invention of the iPad (the product and/or the technology); a trademark for the name of the invention (“iPad”); and a copyright for the TV commercial that Apple uses to market the iPad.
Now, how can this translate into value for your business?
- For starters, the creation of a new revenue source through the licensing, sale, or commercialization of intellectual property assets. This can allow a business to strengthen its market share and increase its profit margins.
- Secondly, ownership of intellectual property assets creates favorability amongst investors and financial institutions, thus providing opportunities for growth or strategic business relationships.
- Finally, in the event of a merger or acquisition, intellectual property assets can play a substantial role in negotiating
better termsor a higher valuation of the business.
Knowing the value that owning intellectual property can have for a business, entrepreneurs should obtain these assets and use them to their advantage to enhance their competitiveness in today’s market.