The Founder Playbook · Legal & Visas
Intellectual Property Basics for a First-Time Founder
Nobody fights about IP ownership until the company is worth fighting over – get the paperwork right before that day arrives.
Key takeaways
- There are four kinds of IP – patents, trademarks, copyrights and trade secrets – and each one protects something different.
- Work created by employees for the company is generally owned by the company; for independent contractors, it usually is not, unless a written agreement says so.
- Every founder, employee and contractor should sign an IP assignment agreement, including for anything built before the company was incorporated.
- Registering a trademark early is cheap insurance against having to rebrand later because someone else already owns your name.
- Trade secrets are only protected if you actually treat them as secret – access controls and NDAs are what make the legal protection real.
Most first-time founders assume that if they built it, they own it. That is often true – but "often" is doing a lot of work in that sentence, and the exceptions are exactly the ones that get expensive. This is general information, not legal advice for your specific situation.
The four kinds of IP, briefly
- Patents protect inventions and functional processes. They require filing with the patent office, take years to grant, and are the most expensive to obtain – worth pursuing only when there is a genuinely novel, defensible invention behind the product.
- Trademarks protect your name, logo and brand as used in commerce. Registration is comparatively cheap and can be done early, well before you need to enforce anything.
- Copyrights protect original creative and written expression, including code, automatically from the moment it is created – but formal registration adds real enforcement remedies you do not get from the automatic protection alone.
- Trade secrets protect confidential business information – your pricing model, an unreleased roadmap – for as long as it stays genuinely confidential, with no registration required or even possible.
The one document that protects nearly all of it
The invention assignment agreement is the piece of paper doing most of the work. "Work made for hire" only automatically transfers certain categories of work created by actual employees to the company – it generally does not apply to independent contractors, freelance developers or agencies, even when the company is paying for the work. Without a signed assignment, a contractor can retain ownership of code or designs they built for you. Every founder, employee, contractor, intern and advisor who touches the product should sign one, and it should explicitly cover anything created before the company was formally incorporated, assigned to the new entity as "prior IP" at formation.
Practical steps early
- Get an IP assignment agreement signed by everyone who touches the product, not just full-time employees.
- Register your name and logo as a trademark once you are committed to the brand, rather than waiting until a competitor forces the issue.
- Limit access to sensitive information and use NDAs for real diligence conversations – a trade secret only stays a trade secret if it is actually treated as one.
- Talk to counsel before publicly disclosing a genuinely novel invention: the US gives a one-year grace period to file after public disclosure, but most other countries require complete novelty and offer no such grace period at all.
The brand check most founders skip
Before you commit to a name, search the trademark register, check domain availability, and check whether the handle is already in active use elsewhere in your industry – not just whether it is technically free. A name that is available as a domain can still infringe on an existing trademark in the same category, and finding that out after you have printed materials and run ads under it is far more expensive than finding out before. It is a quick check that most first-time founders skip simply because it does not feel like the urgent thing to do that week.