Home
>
Strategic Planning
>
Describing Intellectual Property in Your Business Plan

Describing Intellectual Property in Your Business Plan

Most companies that are worthy of raising venture capital have proprietary Intellectual Property (IP). In fact, the quality of the IP and the management team are often the two most important aspects of a venture capitalist's investment decision. The challenge that many ventures face, however, is that most investors will not sign non-disclosure agreements (NDAs), and NDAs are critical to maintaining the proprietary nature of the IP. This article details the appropriate strategy for addressing proprietary IP in your business plan in order to attract investor attention while retaining the confidentiality of your inventions.

Focus on the Benefits of and Applications of the IP: The business plan should not discuss the confidential aspects of the IP. Rather, the plan should discuss the benefits of the IP. Remember that even the most amazing of technologies will not excite investors unless it has tangible benefits to customers.

The business plan first needs to discuss the products and services into which the IP will be integrated. It then must detail the benefits that these products and services have to customers and differentiate them from competitive products. When applicable, it is helpful to include non-confidential drawings and backup materials of the products and services in the Appendix.

Focus on Customer Needs and the Relevant Market Size: The business plan must also discuss how the benefits of the IP fulfill a large customer need. To accomplish this, the plan needs to detail customer wants and needs and prove that the company's offerings specifically meet these needs.

Secondly, the plan needs to discuss the marketplace in which the IP is offered and the size of this marketplace. Critical to this analysis is determining the relevant market size. The relevant market size equals a company's sales if it were to capture 100% of its specific niche of the market. For example, a medical device's market size would not be the trillion dollar healthcare market, but rather the sales of all competing medical devices.

Focus on Competition and Competitive Differentiation: Your business plan must also prove that your IP is better than competitive inventions. In identifying competitors, note that listing no or few competitors has a negative connotation. It implies that there may not be a large enough customer need to support the company's products and/or services. On the other hand, should there be too many competitors, then the market may be too saturated to support the profitability of a new entrant. The answer -- any company that also serves the customer needs that you serve should be considered a competitor.

The business plan should detail both the positive and negative aspects of competitors' IP and products/services and validate that your offerings are either superior in general, or are superior in serving a specific customer niche.

Prove that you can Execute on the Opportunity: As importantly as proving the quality of the IP and that a vast market exists for its applications, the business plan most prove that the company can successfully execute on the opportunity.

The plan should detail the company's past accomplishments, including descriptions and dates when prior funding rounds were received, products and services were launched, revenue milestones were reached, key partnerships were executed, etc.

When a company is a complete start-up, and no milestones have been accomplished, the plan should focus on past accomplishments of the management team as an indicator of the company's ability to execute successfully.

Results: Getting Investors to Sign the NDA: If you are able to convince the prospective investor that the IP is integrated into a product/service which yields real customer benefits in a large market, then the investor will take the quality of the invention for granted when reviewing the plan. Later, during the due diligence process, the investor will review the actual technology. At this point, a discussion regarding signing an NDA would be appropriate.

Since its inception, growthink business plans has developed over 200 business plans. Growthink clients have collectively raised over $750 million in financing, launched numerous new product and service lines and gained competitive advantage and market share. Growthink has become the firm of choice for venture capital firms, angel investors, corporations and entrepreneurs in the know. For more information please visit growthink business plans

limousine service Round Lake .. Lockport Chicago limo O’Hare

In The News:

Kurt "CyberGuy" Knutsson shares several easy ways to keep your credit cards safe from digital thieves while you're traveling this summer.

Arcturus sets up cameras around the edges of baseball stadiums to capture real-time action and generate a 3D digital clone of the game.

Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents now and for the future.

The CyberGuy explains why healthcare organizations are vulnerable to hackers after there have been a half dozen data breaches this year.

Developed at two California universities, the innovative technology combines brain-computer interfaces with advanced AI to decode neural activity into audible speech.

Microsoft patches 12 critical flaws, but six have already been exploited by criminals. Kurt “CyberGuy" Knutsson says updating your system is only a short-term fix.

Tech expert Kurt “CyberGuy" Knutsson discusses how robots can milk, feed and clean cows on dairy farms, boosting efficiency and comfort.

Tech expert Kurt “CyberGuy" Knutsson says quantum internet ensures unhackable security and redefines online privacy and speed.

Kawasaki's CORLEO is a hydrogen-powered, AI-driven rideable robot. Tech expert Kurt “CyberGuy" Knutsson reports on this new way of thinking about off-road transportation.

The CyberGuy breaks down five mobile privacy terms that could make a difference when it comes to keeping your personal information safe.

A groundbreaking robot that's like a real-life Wall-E uses advanced artificial intelligence to replicate natural gestures and deliberate actions with striking accuracy.

If not properly managed, Windows Defender Application Control, a security feature with Windows, could be a potential security vulnerability.

Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents now and for the future.

FlashBot Arm, a semi-humanoid robot, acts more like a human than traditional robots, and you may see it working at a restaurant, healthcare center or hotel.

There are multiple ways to find your missing Android phone after it goes missing. One method involves using a smartwatch to ping your phone.

The NeuroOne OneRF Ablation System is a new device with FDA-cleared technology designed for both diagnosing and treating neurological disorders in one procedure.

The CyberGuy provides tips to protect yourself from criminals who use various methods to make unauthorized transactions using your account information.

New drone technology maps land and water with stunning accuracy, giving researchers and conservationists a new way to understand our planet.

Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents now and for the future.

X hit with massive data breach with 200 million records leaked, including emails. Tech expert Kurt “CyberGuy" Knutsson offers seven tips to help protect yourself.

Atlas robot by Boston Dynamics amazes tech expert Kurt “CyberGuy" Knutsson with its breakdancing moves.

Tech expert Kurt “CyberGuy" Knutsson talks about how Google kept Android SafetyCore details quiet until it scanned users' photos.

Hydrogen trucks debut in Georgia, sparking debates on costs and green freight gains. Kurt “CyberGuy" Knutsson comments on this promising chapter in green logistics evolution.

Tech expert Kurt “CyberGuy" Knutsson says ChatGPT learns from chats, but you should avoid sharing sensitive information to protect your privacy.

Beyond Aero's BYA-1: Hydrogen-electric jet with zero emissions, reduced costs, 2030 launch. Kurt “CyberGuy" Knutsson discusses a potential game changer in the evolution of air travel.

Describing Intellectual Property in Your Business Plan

Strategic Planning