When it comes to tech entrepreneurship, a good intellectual property (IP) strategy will often play a critical role in the difference between unbridled success versus failure-inducing infringement lawsuits. How should technology entrepreneurs and start-ups approach the difficult task of balancing IP protection vs. commercialisation considerations in the dynamic, financial and geo-political landscape of today?
In the face of recent global financial meltdowns, migrant refugee crises, global terrorism and regional upheavals (e.g. Brexit), things may become exponentially more complicated. In terms of IP, the key question for many high-growth start-ups is how to negotiate the daunting landscape of protocol, jurisdiction and regulatory compliance requirements for each new market that they penetrate.
Three key factors, in my opinion, need to be taken into consideration when attempting to address these particular challenges as follows:
- Pay to play - The digital world has ushered in a shift from transactions to a more interaction based economy. According to Constellation Research Principal, Andy Mulholland, three distinct types of time-zone based interactions can be recognised in this new environment. They comprise of: reflex interactions (e.g. autonomous machine to machine interactions); service-based interactions (i.e. multiple, coordinated services interacting to deliver value to customers / subscribers / end-users); and finally, cognitive interactions (delivering enhanced value as part of a 'smart' system and ecosystem).
- Changing of the guard - IP is a moveable feast, and sooner or later any proponent of ‘free-to-use’ IP soon become vigorous advocates of IP protection once they start producing their own. Nations that were once net consumers of IP, with scant regard for anti-piracy measures, will often become rabid defenders of international IP laws when they start producing more IP than they consume. The same applies to start-ups who initially think nothing of appropriating other people's IP in other to create or enhance their own products / services, but then go on to spend oodles of funding money with top IP lawyers to protect or defend their IP as they mature.
- Caring, sharing, gig economy - The last point is very much about the real cost of freedom and flexibility. The so called ‘gig economy’, which offers short term roles for hordes of contingent workers (aka 'micro entrepreneurs'), has been popularised by the likes of Uber, Airbnb and Deliveroo, because they promise a greater degree of freedom and flexibility than traditional employer / employees models. The new gig economy players typically provide a platform for exchanging goods and services, but sometimes this can verge on the traditional 'employee' domain, (e.g. wearing uniforms with the platform providers logo), instead of an independent provider. This blurring of lines could be interpreted by many as an attempt by platform operators to have their cake and eat it, and this has contributed to the recent spate of high profile law suites and demonstrations by irate contingent workers. Such disruptive business practices bring to mind the threat posed to traditional content industries by file sharing platforms such as: Naptster, Grokster, Pirate Bay and Megaupload, who all got sued to smithereens. The sad thing is that such repercussions, if unchecked, can serve to dampen the innovative vigour of said 'gig economy' platform operators. A middle ground must be found where it will be possible to explore the frontiers of the new gig economy without trampling over the rights of its participants. The promise of freedom and flexibility alone may not be worth the pixels through which it is displayed.
In conclusion, when it comes to startup entrepreneurship in today's world, it takes a certain level of awareness to negotiate the myriad challenges facing new innovative / disruptive entrants to most markets. One of the key criteria for success, (in addition to having the right ideas, resources, team and opportunity / timing), is the presence of a good strategy for intellectual property and how it can be employed to the benefit of the organisation. It is no accident, given its high concentration of IP based industries, that California state in the USA is considered the sixth largest economy in the world. It goes without saying therefore how important it is for startups to identify and protect any IP assets, right from the start.
Disclosure: The above post is derived from an article I submitted for publication in the BCS Digital Leaders newsletter. Also the topic of start ups and IP will be the focus of a BCS Entrepreneurs speed mentoring event which I'll be chairing in a couple of weeks.