Plan your IP strategy

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Objective of the guide

This guide provides considerations based on your business objectives that will put you on the path to developing a detailed intellectual property (IP) strategy that you can integrate into your business plan.

1. Developing an IP strategy

An IP strategy is a plan that is created to align your business goals. You can do so by obtaining IP rights for your products and services and by leveraging existing IP assets, in order to gain a competitive edge in the marketplace and drive sustainable growth. An IP strategy may be focused on a single IP asset type or a mix of many (patents, trademarks, copyright, trade secrets or industrial designs).

Developing an IP strategy can be generally considered in the four following stages and may be applicable to your business as a whole or developed for a specific product or service:

  1. understand your business and IP
  2. develop your IP operations
  3. execute
  4. iterate

Figure below – IP strategy process steps

There is a process that can be scaled as you grow your venture to generate your IP strategy. You may apply this process to consistently generate useful updates to your IP strategy for your business.

IP strategy process steps
  1. Business and IP analysis

    • IP alignment Understand your IP assets and how your IP strategy framework relates to your business objectives
    • Portfolio assessment Take inventory of intangible assets and IP
    • Positioning Know the IP strategy of your market and competitors
    • IP analysis What is the best way to maximize the impacts of IP on revenues, competitiveness and reputation
  2. IP operations

    • Develop Create an IP strategy using all information collected during the alignment stage
    • Operationalize Establish IP goals and infrastructure in line with business objectives
  3. IP execution

    • Execution Carry out and communicate the course of actions in your IP strategy
  4. IP realignment

Stage 1: Business and IP analysis

First, to develop your IP strategy, you should understand the types of IP and decide which strategy to pursue, based on your business goals. The type of IP strategy you pursue will depend on the following:

The result will be an IP strategy that is aligned with your business needs.

You should consider that various types of IP strategies exist, that the specific IP strategy and supporting actions will be unique to each business and that each may generate a different respective return on investment for your business. However, there are several general strategy frameworks that can be considered by any business, such as the following:

Due to these various general IP strategies, your business's IP strategy should take into account the vision and mission of your business as well as how it will operate in the marketplace. You can then define the appropriate approach or mix of strategy frameworks around which to build the IP strategy.

Stage 2: IP operations

Second, you should develop the IP strategy and operational details for your business. This includes creating the IP strategy (i.e. vision, mission, guiding principles, supporting metrics and IP asset type needs) as well as setting operational goals and developing a business infrastructure (i.e. budget, headcount resources, risk profile and decision hierarchy) that align with your business strategy. These details depend on the information collected during the alignment process and will result in an operational plan that can be executed on.

Figure below – Overview of your operational plans

Operationalizing your IP strategy is critical to any business or entrepreneur looking to reap the most value from their intangible assets. Consider the following IP tasks or reach out to a Canadian Intellectual Property Office (CIPO) IP advisor if you have questions about which avenue is right for you:

operational figure
Overview of your operational plans

IP protection
IP protection obtained to:

  • Guarantee exclusive use
  • Gain a competitive advantage in the marketplace
  • Prevent counterfeiting and copycats
  • Ensure confidentiality

IP business development
IP can be leveraged to:

  • Generate income through selling or licensing
  • Used as leverage for financial grants or negotiations
  • Create barriers to marketplace access for your competitors

IP commercialization
Your IP can be turned into dollars by:

  • Selling your IP to another individual or business
  • Licensing to another individual or business (rent IP for a price)

IP open source
Sharing or open source licenses

  • Increase uptake of content
  • Combine open source and propriety IP

IP inventiveness
Researching 'prior art' can lead to:

  • Learning about new technologies
  • Creation of new innovative ideas
  • Avoiding duplication efforts
  • Finding partners or infringers
  • Identifying license and technology transfer opportunities

IP monitoring
Monitoring your competitors to:

  • Gain insights into your competitors' market strategies
  • Serve as an information source (i.e. innovation trends)
  • Obtain evidence for legal action against infringement

Stage 3: IP execution

Third, you should communicate and carry out the IP strategy within your business. From an operational or implementation perspective, an IP strategy should not be a standalone plan to execute, nor should it be the responsibility of the legal or research and development (R&D) team to manage alone. Your IP strategy should be an essential and integrated component of your business strategy and should therefore be communicated to staff and senior management during execution. It should also be understood by your advisors and board members (where applicable) so that you can better assess the risk profile and required risk management of all employees. In all cases, the organizational structure, corporate policies and cultural environment of your business should both support and be supported by your IP strategy.

Stage 4: IP realignment

Fourth, you should continually revise and refine your IP strategy. The development of your IP strategy in these three stages is not a single task that is completed only once. Your IP strategy should be developed and evolve over time, and you should refine your IP strategy as frequently as you evolve your business strategy. This is important, because as your business grows your IP assets over time, your branding or technology may also evolve. Costs to maintain and manage your IP assets may also grow over time, so you may need to consider regular actions of trimming and refocusing. Your business position may change, and your IP strategy may mean considering the acquisition of IP assets to secure the desired or additional IP coverage and levels of protection for your growing business.

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2. Alignment with corporate policy and corporate culture

Corporate policy and culture will have an impact on the specific types of intangible assets that can be created and managed. For example, many mature businesses have their own sub-business units with varying market needs, and many high-growth businesses with specific priorities and policies on short-term budget decisions may not be aligned with long-term IP needs. As a result, the IP strategy and IP assets should be managed with the corporate policy and culture in mind.

Strategy: To enable the execution of a robust IP strategy, you must consider the corporate policy limits when creating and managing both the strategy itself and the operational components under it. If your business is just beginning, you should consider setting the policies and culture that match both your IP needs and corporate capabilities. If your business exists, you should consider the potential impacts on your business of implementing any IP strategy, such as adding IP policies that may alter existing relationships with contributors, employees, contractors, partners and advisors.

Figure below – IP policies align under corporate policy

...
IP policies align under corporate policy

Corporate Policy & Business Strategy

  1. Human Resource Policy
  2. R&D, Marketing, Finance Policy
  3. Legal Policy
  • IP valuation
  • IP quality and IP culture
  • IP asset creation, management, and maintenance
  • Confidentiality & non-disclosure policies
  • Partnership development and interaction with 3rd parties
  • IP personnel resourcing
  • Education & skill training
  • Onboarding & exit interviews
  • IP asset management, infringement monitoring, and freedom-to-operate considerations
  • Open innovation vs. closed innovation

IP policies should align under corporate policy and business strategy

For example, policy strategies may take into account the following:

Implementing these corporate policy strategies requires an understanding of how the policies and their respective processes impact various individuals and their business departments. It also requires finding the optimum balance for your business needs vs. policy objectives. In all cases, you should ensure that your business's established IP policies align with corporate policies and support the corporate IP culture that is required by your business.

The list below comprises examples of considerations for IP policy and culture-based objectives for businesses. Each assessment policy and cultural position will be unique for each business, so consider talking with an IP expert or a CIPO IP advisor if you have questions about which types of policies may be right for your business.

Overall considerations for alignment with corporate policy or corporate culture

Trade secret considerations when aligning with corporate policy or corporate culture

Patent considerations when aligning with corporate policy or corporate culture

Copyright considerations when aligning with corporate policy or corporate culture

Trademark considerations when aligning with corporate policy or corporate culture

Industrial design considerations when aligning with corporate policy or corporate culture

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3. Business goals

3.1 Starting a business

Introduction

To ensure your business has a sustainable competitive advantage, it is important to understand how each type of IP can strengthen the competitiveness of your business and how you can use that understanding to develop an IP strategy. It should be closely tied to your strategy to grow your business. You will use your IP strategy to direct your organization's decisions on how, where and when to protect, manage and monetize your intangible assets.

Definition of IP

IP refers to specific types of intangible assets. Each country has its own set of IP laws and regulations that may differ from Canadian legislation. To qualify for protection, IP must fall under one of the following general categories (more information on the different types of IP and how they should be protected is available on CIPO's IP for business webpage).

Benefits of an IP strategy

Having a cohesive IP strategy can help you do the following:

When thinking about these benefits, you must keep in mind that IP rights are negative rights, which means that they prevent others from using your IP. You do not need registered IP protection to sell your product or service.

Basis for an IP strategy

Section: Developing an IP strategy, defines a full set of steps for developing an IP strategy. When starting a business, you can consider the approach below to understand your IP position and to develop your IP strategy and the operational details required to build and develop your IP strategy:

  1. Identifying IP opportunities and pursuing protection

    You should understand and decide on the type of IP strategy to pursue, based on your business goals. General strategy frameworks, such as defensive, offensive, financial, licensing, and/or strategic, can be considered by any business. These are outlined in detail earlier in Section: Developing an IP strategy. However, all strategies will involve the following in the protection of your IP assets:

    • Become informed: Learn the advantages and disadvantages of each type of IP protection, and the strategy to pursue for each type. Make sure your investment in any IP protection is justified by the projected return that exclusivity will bring. To do so, consider the value of your products' exclusivity to customers, investors and business partners.
    • Clear your right to use your IP by searching databases: To avoid inadvertently infringing on the IP rights of others, search regional or international IP databases. CIPO provides free guides to help you search the following Canadian IP databases:
    • Geography of protection: IP registration in Canada does not protect you in other countries. If you want to do business in another country, you must obtain IP rights in that country to secure protection. International filing mechanisms can facilitate IP registration in more than one country.
    • Act in a timely manner: Make sure your IP is protected early to avoid losing your competitive advantage. CIPO provides a number of free tutorials on obtaining a copyright (see also fees), a patent (see also fees), a trademark (see also fees) and an industrial design (see also fees) in Canada. If you are exporting to foreign countries, make sure IP protection is secured in each of these countries. For more information, see CIPO's guides on doing business abroad.
    • Get protection for offensive purposes: Use your IP protection to aggressively enforce your rights against competitors and counterfeiters.
    • Get protection for defensive purposes: Rely on your IP protection as a deterrent to competitors who may accuse you of infringing on their rights.
  2. Identifying business IP assets and IP types

    Next, the type of IP strategy you pursue will depend on the following:

    • the type of intangible assets your business currently has or will generate
    • the known IP strategy of your competitors and the broader marketplace
    • an IP assessment to understand the best way to maximize the value of your IP for your business

    The result will be an IP strategy that is aligned with your business needs. To understand this, you should perform an assessment of IP types relevant to your business and an IP audit to identify your assets and IP gaps.

    • IP types and IP audit: An important step in your IP strategy should be to conduct an audit of the intangible assets your business owns. Once you have identified your IP assets, you can determine if you should invest to protect and manage them. It does not matter if your IP is registered when you carry out your audit. However, you should not include intangible assets that are licensed from or owned by other companies at this point. As part of this IP audit, you should identify the IP gaps you have, based on the types of IP owned by known competitors and the broader marketplace. This will set the foundation for an IP assessment to understand the best way to maximize the value of your IP for your business as well as the type of IP you need, compared to the type of IP you may have.
  3. Executing IP strategy and performing risk management

    Finally, you should begin to develop your IP strategy within your business while understanding the IP risk profile and required risk management.

    • Integrating IP into the business: From an operational or implementation perspective, an IP strategy should not be a standalone plan to execute, nor should it be the responsibility of the legal or R&D department to manage alone. Instead, your IP strategy should be an essential and integrated component of your business strategy that is supported by all areas of your business.
    • Promoting IP awareness internally: Your employees should be aware of their responsibilities in protecting your IP. They should learn the fundamentals of IP protection. Once they are IP literate, your employees can participate in the identification of key IP assets and help you strategize on how, where and when to protect, manage and monetize your intangible assets to add value to your business.
    • Ensuring IP can be maintained: Have employees, investors and business partners sign nondisclosure or confidentiality agreements to protect your trade secrets, know-how and inventions or designs that are not protected by patents and registrations for industrial designs.
    • Monitoring the market and defending your rights: Your exclusive IP rights secured upon registration are only valuable if you prevent others from infringing on them. If you discover your rights are being violated, you can, with the help of IP experts, send cease and desist letters, negotiate cross-licensing or settlement agreements, or enter into litigation, arbitration or mediation proceedings.

    By understanding these details, you may formally begin to develop your IP strategy as described in Section: Developing an IP strategy.

3.2 Starting a new line of business

Strategy: As your business grows, you may decide to introduce new and innovative products or services. To protect your investment and avoid infringing on the IP of others, make sure to identify, protect and manage your new IP assets at the earliest possible stage in their development.

Overall considerations when starting a new line of business

Patent considerations when starting a new line of business

Trademark considerations when starting a new line of business

Copyright considerations when starting a new line of business

Industrial design considerations when starting a new line of business

Trade secret considerations when starting a new line of business

3.3 Financing and loans

Strategy: You may be able to use IP assets to help you obtain financing from banks, venture capitalists, angel investors, government agencies, etc. In fact, the presence of IP assets often indicates to financial partners that your company has a certain degree of market exclusivity or competitive advantage and that it therefore has a higher likelihood of success. IP assets may help investors or lenders gain confidence in your business's competitive advantage and the validity of its market opportunities. It is, therefore, important for you to understand your IP assets and how they support your growth, branding and marketing strategy.

While IP is intangible, it is a business asset. This means equity investors will have a stake in its ownership, while debt holders could lay claim to it in the event the business fails.

Overall considerations when seeking financing

Patent considerations when seeking financing

Trademark considerations when seeking financing

Copyright considerations when seeking financing

Industrial design considerations when seeking financing or loans

Trade secret considerations when seeking financing

3.4 Operating a business

Strategy: As your business requires continual operation, you should continue to maintain your investment in IP. To protect investments, remain vigilant concerning competitors' IP to ensure continued freedom to operate, and continue maintaining IP assets as your products and services are offered or as they evolve to match the marketplace needs. An IP strategy should be considered from two perspectives: first, to ensure the strategy protects the current products or service offerings, and second, to ensure the strategy is matched for new revisions or updates to your products and services.

Overall considerations when operating a continued business

Patent considerations when operating a continued business

Trademark considerations when operating a continued business

Copyright considerations when operating a continued business

Industrial design considerations when operating a continued business

Trade secret considerations when starting to operate a continued business

3.5 Growing your business into new markets

Strategy: The strategic use of your IP assets may enhance your business's competitiveness when you expand into international markets. There are increased costs as well as paperwork, linguistic or cultural barriers and competition associated with exporting. An effective IP strategy may help you manage some of these challenges. Because IP rights are territorial, registration in Canada will not protect your IP assets in other countries. If you want to protect your IP abroad, you must register your IP rights in each country where you want to do business.

To export successfully, you will need the capacity, resources and management capability to sell and deliver your products or services abroad at a competitive price. You may want to consult CIPO's guides on doing business abroad.

Overall considerations when exporting

Patent considerations when exporting

Trademark considerations when exporting

Copyright considerations when exporting

Industrial design considerations when exporting

Trade secret considerations when exporting

3.6 Enforcing your intellectual property rights

Strategy: To fend off copycats, make sure your IP rights are protected. A business may enforce its IP rights when someone infringes on, obtains or uses its IP assets, including trade secrets and confidential information, without permission. Because most IP rights are territorial, securing IP rights in one country will provide you with protection only in that country. CIPO does not enforce the rights of registered IP owners. It is up to the owners of a registered patent, design or trademark to take steps to prevent IP infringement and enforce their rights when it occurs.

Here are the steps you can take to prevent violations of your IP rights:

Note: It is always a good idea to consult a legal service professional to determine the best course of action.

Patent considerations when enforcing your IP rights

Trademark considerations when enforcing your IP rights

Copyright considerations when enforcing your IP rights

Industrial design considerations when enforcing your IP rights

Trade secret considerations when enforcing your IP rights

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4. IP ownership

IP refers to specific types of intangible assets. Each country has its own IP laws and regulations that may differ from Canadian law. To qualify for protection, the assets must fall under legally defined parameters. More information on the different types of IP and how they can be protected is available on the CIPO website.

Strategy: Ensure you own or have been assigned your IP rights. Many costly disputes involve the question of IP ownership. When your business succeeds based on market exclusivity or a competitive advantage afforded by your IP, contributors, employees, contractors, partners and advisors may dispute your ownership. Thus, it is important to protect your IP ownership from the start. Ownership of an IP right depends on several factors, including the following:

IP rights may be obtained through a grant from an IP office or by the transfer of ownership and licensing where an individual or company obtains IP rights from the owner.

4.1 Patent ownership considerations

4.2 Trademark ownership considerations

4.3 Copyright ownership considerations

4.4 Industrial design ownership considerations

4.5 Trade secret ownership considerations

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5. IP assessment and prioritization

To ensure the IP strategy of your business is successfully defined and executed, you should make a clear and concise plan for assessing and prioritizing IP assets to be managed and maintained, both at their creation and at relevant points in the IP assets' lifetimes. There should be an assessment of innovations with respect to the type of IP that is critical for your business (i.e. patent, trademark, industrial design, copyright). This assessment should be considered at the early stages (i.e. when ideas and innovations are in the process of being formed into IP assets) as well as the mature stages of the assets (i.e. when the assets are formally registered). Finally, there should be a dedicated team with IP skill sets and knowledge to assess and prioritize the IP assets, and this should be done on an ongoing basis.

5.1 IP assessments: Identifying and assessing

After the creation and identification of the IP asset by your business, there should be documentation and IP assessments of any new IP assets that could impact business value. This could include identifying and assessing all registered IP assets (patents, copyright, trademarks, industrial designs) as well as unregistered IP assets (unregistered trademarks, trade secrets, know-how). You can identify assets by implementing IP harvesting sessions (i.e. brainstorm or ideation group sessions) within your business for innovations or idea sources, or by performing an IP audit of the organization. This could include identifying new or existing products or services for branding opportunities, trade secrets or technical and updated technology solutions to protect.

An assessment of the new IP assets should be done in conjunction with the IP strategy, which supports the types of IP that are important for your business. For example, your business may be focused heavily on branding and thus assess all opportunities to protect assets via unique registered and unregistered trademarks. Another business may be focused heavily on trade secrets and assess all opportunities that rely on secret processes or data that are not to be disclosed to customers, to ensure they are adequately protected. Your business's IP strategy may be a mix of patents and trade secrets, requiring that each innovation or idea be associated with the appropriate IP asset so it can be protected properly.

5.2 Prioritization of assets

Prioritizing IP: Once assessed, IP should be prioritized in terms of the IP strategy and business resources to match the highest business opportunity. Potential IP assets may be prioritized differently by different businesses and their IP strategies, and by the teams that manage the process. For example, a priority may be set by an IP review committee or an IP team, with the following considerations:

These types of questions should ensure your business is prioritizing assets in the context of ensuring that IP gaps are filled, that IP risks are weighted (ownership, resourcing) and that IP considered fundamental or strategic to the business is prioritized highly. Each assessment for priority will be unique for each business, so consider talking with an IP expert or CIPO IP advisor if you have questions about which types of priorities may be right for your business.

5.3 Operational considerations

For some businesses, it may not be enough to do a one-time assessment or to have such an assessment done only by a limited team within your business.

Team to assess and prioritize: The best legal and business team to assess and prioritize is often a business-centric team with at least three skill sets:

  1. a legal skill set, to understand the local and global legal issues to consider with respect to the IP assets in question
  2. a business and technology skill set relevant to your market, to bring understanding of the innovation or idea's product or service (for technology-heavy businesses that may rely on patents, the technology skill set is critical in ensuring the priority of key technical assets, while for brand-heavy businesses that may rely on trademarks, the business skill set is critical in ensuring the priority of the current and future branding plans)
  3. a strategic or competitive market skill set, to bring understanding of the competitive or market impacts the IP may bring to your business

In combination, these skill sets will ensure the IP assessments and prioritization results have the optimum balance of strategic and market needs that benefit your business, while adhering to the relevant legal requirements necessary to maintain your intangible assets.

Prioritization over time: Prioritization should be continually revised for your business. It should not be restricted to incoming IP assets for your business, but should also include the prioritization of existing assets from the perspective of business value. There are several factors for this reasoning:

  1. Business objectives may evolve or change over time, and new competitors may enter the market and disrupt the current market dynamics. This may require a change in resource allocation concerning how assets are prioritized.
  2. Businesses themselves may evolve over time through mergers and acquisitions, strategic partnerships or unexpected product or service changes. This may bring additional IP assets into the portfolio that require management and re-prioritization of resources.
  3. Some IP assets, such as patents or trademarks, continue to accrue annuity charges once granted/registered. Over time, these annuity bills from registrations in various countries may become costly and require review and prioritization so that their business value and the resources allocated to manage the assets can be assessed.

To address these factors, regular review and re-prioritization of incoming and active IP assets should be considered a normal course of action for your business. The timing for review may vary for different businesses and their IP portfolio sizes, but annual, quarterly or even monthly reviews to update and verify portfolio direction are not uncommon in many global businesses.

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6. IP protection

Strategy: It is often difficult for those who are not experienced in IP law to know which assets merit protection. That's why it is important to familiarize yourself with IP principles and develop an IP strategy for your business. Knowledge is power. Doing your own research and/or consulting an IP expert will increase your awareness of the IP protection that has already been granted in your area of interest and help you narrow your options. It may also save you time and money.

Once you have identified the intangible assets you may want to protect, you must determine which aspect of your intangible assets is protectable IP. To qualify for registration, an intangible asset must fall within the legal definition of protectable IP.

6.1 Patent due diligence

Patent application process

6.2 Trademark due diligence

Trademark application process

6.3 Industrial design due diligence

Industrial design application process

6.4 Copyright due diligence

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7. Fees and timelines

Strategy: Creating an IP strategy for your business will help you invest your money effectively. The cost of obtaining and maintaining IP protection should be weighed against how much competitive advantage, market exclusivity and investor confidence it's likely to bring you.

Cost will vary depending on your needs and on the complexity of the work required. The following is for information purposes only.

Approximate cost range for CanadaFootnote 1
CIPO fees (administrative fees) IP expert fees (generally hourly fees)
Filing Examination Registration Maintenance/Renewal
Trademark from $330 - - from $400 $500 - $2,000
Patent $400Footnote 2 $800Footnote 2 $300Footnote 2 $100 - $4,800Footnote 2 $5000-$25,000
Industrial design - $400 - $350 $500 - $2,000
Copyright $50 - - - $0 - $500

Ask your IP expert to provide detailed estimates of fees and disbursements, including government fees. You should also ask about the likely timing of expenses to help you budget.

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8. Commercialization and monetization of IP

IP commercialization allows a business to buy or in-license needed IP assets for business needs or to out-license IP assets with the goal of creating value through revenue, business growth or profits.

Both commercialization and monetization activities should be done while considering the strategic importance of the IP assets (for example, whether they are core assets for your business or non-core assets that do not directly contribute to your business value).

Figure below – Approaches to commercialization and monetization and sample outcomes

strategy figure
Approaches to commercialization and monetization and sample outcomes

Commercialisation and Monetization actions (both core and non-core should be considered)

CORE ASSETS
Commercialization:

  • IP asset purchase
  • IP in-licencing

Monetization:

  • IP asset sale
  • IP out-licensing

Commercialisation and Monetization business outcomes

  • Licencing Agreements
  • Technology transfer of IP assets
  • Franchising of your business model
  • Spin-off creation for a new product or service
  • Revenue through asset sale or out-licencing
  • Business growth through in-licencing or purchase

8.1 Licensing

Strategy: Commercialization or monetization via out-licensing of your IP rights may be an effective and low-risk way of growing your business, improving your products or services and increasing your profits. Commercialization via in-licensing or acquisition of other IP rights may also be an effective way of growing your business, improving your products or services and increasing your profits.

A license is a legal agreement between an owner of IP ("licensor") and another individual or group ("licensee"). The licensor permits the licensee to use the IP without transferring the ownership of the IP, in exchange for an agreed fee.

Overall considerations when deciding whether licensing your IP rights is the best fit for your business plan

Patent licensing considerations

Trademark licensing considerations

Copyright licensing considerations

Industrial design licensing considerations

Trade secret licensing considerations

8.2 Franchising

Strategy: Commercialization or monetization via franchising your business model along with your IP rights can be a low-risk, low-cost way of expanding your proven business model.

Franchising is an agreement wherein an individual or group ("franchisee") is granted the right to use a business owner's ("franchisor") proven business model, plus associated IP, and is also given training and support, in exchange for fees. Franchising involves a special type of IP licensing arrangement.

Overall considerations when deciding whether franchising fits within your business plan

Franchising and patents

Franchising and trademarks

Franchising and copyright

Franchising and industrial designs

Franchising and trade secrets

8.3 Purchase or sale

Strategy: Monetization through the sale of IP assets for your business may be an effective strategy to maximize the value of your business. Likewise, the purchase of IP assets to add to your IP portfolio to allow for more effective commercialization of your business may be an effective strategy. IP assets should be assessed, valued and transferred strategically to realize their full value in a sale.

A purchase, acquisition, sale or divestiture refers to the transfer of tangible or intangible assets through a purchase or sale to another entity. To streamline the purchase or sale of an IP asset, an IP broker may be utilized to facilitate the transfer. As an independent third party and IP expert, they may assist in IP valuation, assist in negotiating a fair market price for the IP asset and provide support for the operational considerations of the transfer.

Overall considerations when buying or selling assets as part of your business

Patent considerations when buying or selling assets as part of your business

Trademark considerations when buying or selling assets as part of your business

Copyright considerations when buying or selling assets as part of your business

Industrial design considerations when buying or selling assets as part of your business

Trade secret considerations when buying or selling assets as part of your business

8.4 Spin-off or technology transfer

Strategy: The spin-off or technology transfer of your IP rights may be an effective way of growing your business, improving your products or services and increasing your profits. A spin-off is a buzzword that typically refers to transferring some tangible and intangible assets from an existing entity to a newly created business. Technology transfer is similar and typically refers to transferring the technology from your business to a secondary business. It may involve a sale but may often include registered assets such as patents, skills, know-how or other trade secrets required to operate the technology as intended.

Overall considerations when creating a spin-off or undertaking the technology transfer of your IP assets as part of your business

Patent considerations when creating a spin-off or undertaking the technology transfer of your IP assets as part of your business

Trademark considerations when creating a spin-off or undertaking the technology transfer of your IP assets as part of your business

Copyright considerations when creating a spin-off or undertaking the technology transfer of your IP assets as part of your business

Industrial design considerations when creating a spin-off or undertaking the technology transfer of your IP assets as part of your business

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9. IP valuation

Intangible assets can be bought, sold or secured against like tangible property. Generally, the value of an IP asset lies in your ability to prevent others from making, using or selling a product or service in a specific geography or market. Businesses should consider valuation so they have an understanding of the value the asset contributes. However, assessing or calculating the value of an intangible asset in this context has many variables, and there are many reasons within a business for performing the valuation.

9.1 Overview of valuation methods

Despite the variety of ways value can be recognized by interested parties, your business can consider the typical accepted qualitative approaches to valuation methods for the IP assets as one of the following:

You should consider the challenges associated with each of these methods and confer with an IP expert to determine the appropriate valuation method for your business.

9.2 General considerations for having an IP valuation report

Strategy: You may be able to use your IP assets to help you obtain financing from banks, venture capitalists, angel investors or government agencies, to build corporate value through joint venture agreements and strategic partners or to build revenue by licensing royalty income. You may be required to value your assets for accounting, compliance or infringement damages reasons. It is therefore important for you to understand the types of IP valuation reports and the considerations when valuing specific assets.

Below are the considerations for valuing your IP assets. Varying standards or types of valuation methods apply in each case.

Businesses should consider that there are both negative and positive implications for defining a value to their IP assets. For example, a low valuation calculated for tax or transfer pricing purposes may trigger a similarly low valuation for future litigation damage assessments when you enforce your IP against an infringing third party, and vice versa.

Patent considerations when valuing your IP rights

Trademark considerations when valuing your IP rights

Copyright considerations when valuing your IP rights

Trade secret considerations when valuing your IP rights

Industrial design considerations when valuing your IP rights

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10. Working with third parties to develop IP

A joint venture (JV) is an independent business entity with ownership being held by two or more businesses. JVs are formed to reduce the costs and risks associated with a new project by sharing the resources (capital, employees, industry expertise and IP) of two or more business partners. The IP owned by any one of the partners can be contributed to the JV through a licensing agreement (fee for use) or through assignment (outright sale).

Considering your joint venture scope

Strategy: When you consider entering into a JV with another company, it is important to understand the scope of IP use and ownership, as well as the benefits and ownership needs of any new IP that may be developed as a result of the JV.

Even before forming a JV, businesses should consider the appropriate level of IP asset contributions and compromises they are willing to have. This includes but is not limited to specific IP topics that should be considered in the creation of a joint development agreement (JDA) for the JV and the development of the right contracts to protect your business and the IP. These terms should be considered in defining the IP scope and definitions for the JV, which should include background IP, project IP, foreground IP and third-party IP.

The following recommendations are relevant for all types of IP (patent, copyright, trademark, trade secret, industrial design) during the creation of contractual agreements to both form and operate a JV:

An understanding of these IP topics should enable your business and the partner business to define the scope of a JDA that aligns with their IP strategy and corporate needs, which will clearly define the IP ownership, use, restrictions (i.e. license rights, confidentiality requirements), liabilities and protection (i.e. financial risk and infringement liability) and maintenance costs of the JV outcomes.

10.1 Finding the right joint venture

Locating the right JV partner is often linked to a business, technical or marketing strategy for a business, and there are many public resources to help identify JV opportunities for your business needs. For example, look for opportunities to sell or buy solutions for your business needs:

However, IP assessments or IP landscapes can generate partnership opportunities not found in many traditional public resources. Consider using IP intelligence or data to find or build stronger JV partners. If an IP gap is identified during the IP strategy creation process, IP landscaping of the marketplace or IP assessments of the technology or branding space may offer an advanced way for a business to generate high-quality JV leads to fill or collaborate with to fill such an IP gap. For example, during an IP strategy analysis, IP gaps for your business may be identified where comparable IP assets may be assigned to a second company in a related market space, forming the basis for collaboration opportunities.

When reaching out to a potential JV partner, consider the following from an IP perspective:

10.2 Entering into a joint venture

Strategy: When you enter into a JV with another company, it is important to define and negotiate the use and ownership of your existing IP and any new IP that is developed as a result of the JV.

Overall considerations when entering into a joint venture

Patent considerations when forming a joint venture

Trademark considerations when forming a joint venture

Copyright considerations when forming a joint venture

Industrial design considerations when forming a joint venture

Trade secret considerations when forming a joint venture

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11. For more information

You may wish to hire an IP professional to write and follow through on your application for IP protection and to help you develop effective IP use strategies for your business. These would include when and where to apply for IP protection and how to avoid common IP pitfalls. IP professionals include registered patent agents and trademark agents. You may request a list of registered patent and trademark agents from CIPO's Client Service Centre. If you are exporting to foreign markets, the Find a Trade Commissioner page provides a list of trade contacts.

For additional information, you can check out CIPO's IP Hub, which is a digital platform where you can navigate through the four stages of an IP journey and connect with services in the marketplace. Discover the world of IP and find experts and funding to help you bring your ideas to life.

Find more programs and support for Canadian businesses and innovators at Innovation.canada.ca

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