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Intellectual Property (IP) rights
Importance of intellectual property (IP) rights for your product
Most entrepreneurs would say that the product they are offering is innovative, unique, or superior to the offerings of competitors. But is this really so? If you believe it is, you will have to prove it, and a patent (or the results of a reliable patent search) may be the best proof of novelty you can get. Therefore, safeguarding such knowledge and creative expression from inadvertent disclosure or unauthorized use by competitors is becoming an increasingly critical element in developing and retaining competitive advantage.

Work of art
Work of art by one of our SMEs
Your trade name, trademarks and domain names may be the prime elements that differentiate your product from those of competitors. Therefore, your proposed name(s) should be carefully chosen and the steps taken to register them should be referred to in your business plan.

In addition, start-up service providers and investors will want to make sure that the product you propose to sell is not relying, without authorization, on other companies’ trade secrets, copyrighted materials, patents or other IP rights, as this may bring the downfall of your own business through expensive litigation. In some high-tech sectors, the risk of infringing on third-party IP rights is high and start-up service providers  and investors may be reluctant to take the risk unless you can prove (e.g. through a patent or trademark search) that no such risks exist.


For many businesses, confidential business information (such as details of production, secret inventions, and technical, financial and marketing know-how) alone may be the source of their competitive advantage. In such circumstances, it is important to communicate to start-up service providers and investors that your enterprise has proprietary and significant business information – known as trade secrets – and that you have taken adequate steps to protect it from employees and competitors. Even your business plan is a secret document that should not be disclosed except on a ‘need-to know’ basis, and that too, generally, only after the employee, investor, or whoever else is concerned has first signed a nondisclosure or confidentiality agreement.

Importance of including intellectual property issues in your business plan

If Intellectual Property (IP) is an important asset for your business (i.e. if you own patents or patentable technologies, industrial designs, trade secrets, reputable trademarks, or if you hold the economic rights to copyright works), then it should be a key part of your business plan.

An adequate reference to the assets of a company and its market opportunities should not only list the tangible assets (e.g. factories, equipment, capital) but also the intangible assets, because the latter are increasingly the key to a company’s success in a hypercompetitive environment. Any indication that confirms due diligence on your part in the management of IP assets is likely to play an important role in convincing start-up service providers and investors of your company’s potential.


Building a business also requires various types of other resources, including a network of relationships, business partners and sources of funds.

The intellectual property (IP) protection system provides a key tool for :
•Keeping at bay unscrupulous competitors;
•Developing relationships with employees, consultants,
•suppliers, subcontractors, business partners and customers;
•Obtaining funding based on your innovative product / idea and its potential

To attract investors, it is necessary to have a quality business plan that looks objectively at the prospects of the proposed business. In order to convince investors you will have to show that:
•There is a demand for your product in the marketplace;
•Your product is superior to competing products, if any;
•You have taken adequate steps to protect your product to prevent ‘free riding’ on your success by dishonest competitors.
Source: International Trade Center: Trade and Business Briefing

Further Reference:

Practical IP issues in developing a business plan, visit the World Intellectual Property Organization (WIPO) Website at www.wipo.org/sme/en/ip_business/managing_ip/business_planning.htm

You can also contact

Kenya Industrial Property Institute,
Popo Rd. off Mombasa Rd. South - Weights and Measures Complex
P.O. Box 51648, City Square 00200- NAIROBI.
Telephone: +254-02-602210,602211
Fax:254-02-606312
Telcom wireless: 020-2386220/ Mobile 0736002020
E-mail: This e-mail address is being protected from spam bots, you need JavaScript enabled to view it  

 
 
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