A Tale of Two Friends with an Idea: How to Protect Intellectual Property in Business

Have you ever thought about collaborating with another entrepreneur or small business on a project to give your company a boost in visibility, creativity and potential clients?

Most small business owners have. But in their excitement, many overlook the fact that, in the process, they are creating something new. And just as human children need our protection, our “brain child” – or intellectual property – also needs our protection.

Unfortunately, entrepreneurs often don’t realize — before it’s too late — that when working on new partnerships and ventures:

a. They had intellectual property that could have been protected; and

b. What steps they could have taken to protect it.

A Tale of Two Friends with an Idea

Let me share an example of how this scenario often plays out.

Sarah, a former school psychologist was having coffee with her fiend Fiona, the owner of First Financial, Inc., a company that provides books on financial education and financial management for adults. Sarah was complaining to Fiona that more and more, she was having difficulty conveying information to the kids in a way that “resonated” with them.

Fiona interjected, “Have you thought about including ‘how to get the “bling” and other things you want out of life’ in your workshops?”  “Maybe adding a “Show me the money!” component would keep their interest,” she added.

Given Fiona’s background in showing adults how to overcome resistance to learning about money, she was eager to help Sarah do the same for children. And Sarah, who had experience dealing with children, was very happy to have Fiona’s assistance and knowledge pertaining to money issues.

When Collaboration Turns into Uncertainty in Business

Over the next couple of months, Sarah and Fiona met regularly to develop their idea. Ultimately, they created a plan for an interactive workshop and board game, called “Hard Knocks.”

However, their collaboration hit a roadblock when Sarah mentioned she wanted to use “Hard Knocks” for her own project with at-risk adults, after being approached by a non-profit. At that point, Fiona realized that “Hard Knocks” – if used by the general adult population – might steal her company’s thunder . . . and profits. So, Fiona started to pull back from the project, which left Sarah wondering if Fiona still wanted to be a part of it.

How can these two friends untangle their web of uncertainty and move forward with their new business idea? Here are four things every entrepreneur should consider before collaborating on new projects:

1. Maintain open communication.

In an idealist self-preservationist world, Fiona would have thought through the ramifications of collaborating before she started freely sharing her wonderful ideas. But life is rarely ideal.

The solution: As Fiona’s first step, she should sit down with Sarah and explain her concerns. Working out a fair, written agreement concerning your intellectual property is always better belatedly, than never.

2. Consider what’s at stake.

Even if Fiona and Sarah never have a written agreement, copyright laws provide them with some measure of protection.