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Answers To Common Trademark Questions That Business Owners Fail To Ask Or Consider
Posted in: Blog by Elizabeth Ritter on February 1, 2012
Protecting one’s trademarks is an area that is often overlooked by business owners. This oversight can have significant financial consequences to the business. I have seen numerous instances where a company receives a cease and desist from a trademark owner for failing to conduct a thorough search before choosing a name or logo for their business. In addition, I have seen other companies move to expand into a new area, only to find a company already present with the same name for similar services. Much of this could be avoided by considering trademark protection at the outset and being knowledgeable with regard to the following items.
• What is a trademark? It is a word, phrase, symbol or design that identifies and distinguishes the source of the goods or services of one party from those of others.
• Must all marks be registered? No, it is not required. However, federal registration provides certain advantages to the trademark owner, namely notice of claim of ownership to others, the exclusive right to use the mark in conjunction with the goods or services or the legal presumption of ownership nationwide.
• What can happen if I decide to wait to register my mark? If someone else files for federal registration before you, then you may be limited to only the geographic area in which you currently sell your product or service, which may severely limit future growth under that name.
• When should I have a trademark attorney conduct a search of my name? Ideally, this should occur prior to the commencement of operations under that name. This is true even if you do not plan to register the name because you want to make sure that there is not another trademark out there for similar goods or services.
I oftentimes have clients that have been in business for more than five years before they consider protecting their name. Sometimes they are able to move forward with a trademark application at that point. However, other times they have lost the ability to file for federal registration because someone else beat them to the punch.
• When can I use the TM symbol or the ® symbol? The TM may be used next to your trademark to indicate you are claiming rights to the mark. This may be used without filing for trademark registration. The ®, on the other hand, may only be used when a Certificate of Registration has been issued by the U.S. Patent and Trademark Office (“USPTO”) for the trademark.
• Are there terms that cannot be protected under trademark law? Certainly, there are various marks that the USPTO will not register. These include, but are not limited to, generic marks, merely descriptive marks, immoral marks, marks that are merely a surname and marks that are confusingly similar to existing marks, to name a few.
• Should I file for protection for my name, my name in conjunction with my logo, or both? In a perfect world, I would say to file both. However, not all small business owners can afford two trademark applications out of the gate. If a company can only afford one, most trademark practitioners recommend that the word mark be filed for first and the logo at a later date. The word mark does offer a wider breadth of protection. If you file for the logo and not for the word mark, then a problem can arise later if you decide to change the logo.
Intellectual property is an intangible asset, which may be why so many business owners fail to recognize its value and take steps to protect it at the correct time in the life cycle of their business. Understanding some of the questions discussed above and speaking with an intellectual property attorney will go a long way toward avoiding costly problems down the road.
An Employer’s Guide to Preserving Intellectual Property Rights
Posted in: Blog, Legal Issues by Elizabeth Ritter on December 30, 2011
Many employers assume -often wrongly-that the intellectual property employees create for their companies is automatically owned by the employer. In fact, determining the owner of the intellectual property is a fact-driven analysis that will often depend upon the employer’s level of involvement in the creation of the intellectual property. Because of this, it is important for employers to take measures to ensure that it is clear who owns the intellectual property created for the company.
With regard to an employee that creates a work as part of his or her job, it is the employer who is the owner of the work under the work made for hire doctrine. Employers should be aware of the exceptions to this doctrine, however, because there are employee creations and inventions that are not the property of the employer. For example, inventions that are not created in the scope of employment are employee property. In order to fall out of the scope of employment, the invention must be created during the employee’s personal time and without use of the employer’s resources. In addition, prior inventions of the employee are also excluded from the employer’s portfolio, and are discussed more below. If the employer wishes to obtain rights to a work not made for hire, the parties can agree to sign an assignment agreement whereby the employee agrees to assign certain works to the employer.
The best practice from the employer’s perspective is to require employees to sign a written agreement upon hiring them. The employers may also have current employees sign, but courts have held they are not required to do so unless further consideration is given in the form of a raise or promotion. This agreement should include a provision whereby the employee states that all intellectual property shall be the property of the company, minus certain exceptions such as prior inventions. Prior inventions of the employee should be listed within this agreement- perhaps in an exhibit- (i) to avoid future disputes about what constitutes a prior invention of the employee, and (ii) to put the company on notice of prior inventions created for a prior employer so that the company is better able to avoid potential infringement situations.
Another method of avoiding disputes and preserving the employer’s intellectual property is to simply educate the employees about intellectual property in general and, more specifically, what is required of the employees with regard to the company’s intellectual property portfolio. This may be done during employee training and by adopting internal policies to serve as a guideline for the employees. The employer should notify the employees that if they are uncertain about something, then they should ask the employer first before disclosing information that might potentially be confidential. Let the employees know that ignorance is not an excuse.
The value of intellectual property assets continue to rise, and with this increase, it is essential that employers clearly indicate who owns particular intellectual property assets and what employee obligations are with respect to those assets. Utilizing some or all of the practices described above will go a long way toward decreasing disputes with employees claiming rights to the company intellectual property as their own, as well as hopefully reducing the instances of misappropriation and infringement by employees.
Get Some Social Proof
Posted in: Blog, Startup, Uncategorized by jrobinson on April 26, 2011
So that idea is still nagging you? Feeling ready to start a business? Before you risk your time, security & savings, there are some things to do first.
Either many entrepreneurs are cocky, or cocky people become entrepreneurs. Sure, a degree of self-assurance is required to be successful. Where things go awry is when you become so caught up in an idea, just knowing it’s going to work, that you don’t stop to find or seek out some social proof. An untested idea is a shot in the dark. But knowing that people really need and will use your product is incredibly validating & the first step to a successful venture.
I strongly encourage everyone that has an idea to pursue it. Jump right in & see what happens. What’s important is that pursuing it the right way can protect you from spending your savings or cold-quitting your job before you’ve validated the idea. What you think you want to do may not be what customers need. By trying it out, getting feedback & applying it, you may end up pivoting and morphing into something else (whether related or unrelated), and that “something else” could be wildly profitable.
To illustrate, a recent New York Times article, “The Dark Side of Opening a Store“, shows the downfall of blind assurance, albeit from a brick-and-mortar perspective. Here is an excerpt:
“In 2004, Ms. Schmidt moved from New York to Colorado Springs, Colo., to join her future husband. She became fascinated with local history and culture, but she was disappointed when she had trouble finding cowboy boots in colors other than brown and black. She started to contemplate opening a store where she would sell a greater variety of boots along with other high-end women’s western wear…
During the 2006 holiday season, she introduced Girl of the Golden West as a pushcart in a Colorado Springs mall. Sales were dismal, but Ms. Schmidt attributed them to a mismatch between her high-end merchandise and the lower-income customers the mall served. So, she moved to temporary space in a more upscale mall. And when permanent space became available she seized it, paying monthly rent of about $2,500 plus a percentage of the store’s still anemic sales. Then she began approaching banks and learned the hard truth that they generally don’t lend to start-ups. Nor was the Small Business Administration, which guarantees loans made by banks, the source of financing she had imagined. She even sought venture capital.
Despite these setbacks, Ms. Schmidt, who describes herself as an optimist, was undeterred. She had $500,000 from the sale of her Manhattan apartment and decided to sink all of it into the store. About $300,000 of that went toward renovating the new space at the mall. Ms. Schmidt, who had five employees at most times, still wasn’t covering her rent…
In a final effort to breathe life into the business, Ms. Schmidt left the mall, relocating in a pedestrian-friendly strip in Manitou Springs, a historic mountain community. She no longer had to hand over a percentage of sales to a mall or staff the store during off hours. But it didn’t help enough, and she finally decided to close last summer.
She lost her entire investment, owes back taxes on the store and has filed for bankruptcy. “My credit rating is ruined, and if I weren’t married, I’d be homeless,” she said.”
How can you avoid this? Test your idea before going “all-in”.
If you’re a brick-and-mortar venture:
Survey your friends and friends of friends. Study the competition, both locally & regionally. Distribute some flyers with your phone # or email address on them. Track how many calls or emails you get & what people want to know. Most importantly, think of ways to minimize your initial investment. For example, if you want to start a furniture store, don’t sign a three-year lease in Birmingham’s SoHo or another top-dollar commercial district right away. Rent a booth at a local antique marketplace or attend regional shows first. Start building a loyal customer base – people who love what you do & are excited about it. Leverage these people to help you spread the word. Before long, if you get a real sense of other people’s excitement and passion – these are your future customers.
If you’re a tech startup:
Don’t sink $20,000+ into a website or mobile application before you’ve done your homework. In fact, you should be able to validate your idea, test market trends, and get some initial traction for as little as $300 + with some basic technical know-how. First, choose & buy your domain. Then, create a landing page. Reveal what your site or product does (or will do), that it’s in private beta testing, and offer an email signup field. Use WordPress if you’re not a savvy coder. Next, add Google analytics then sign up for a Google AdWords account. Create a handful of ads, choose 5-10 applicable keywords per ad, then monitor impressions & click conversions over the next few weeks. Spread the word on Twitter & Facebook to your own friends. Track site hits & email signups, then start a conversation with your subscribers. Don’t just send out “newsletters” – survey their opinions, such as which features they want, how they’d use it, if they’ll be willing to pay, etc. This should be your starting point & will either validate or invalidate your idea.
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This post was contributed by Jonathan Robinson, a young entrepreneur living and working in Birmingham. Jonathan’s companies include FreeTextbooks.com (founded 2009) and theClubhouseLeader.com (founded 2010).
BE Women’s Series April Event: Recipe for success
Posted in: Featured by Brian Cauble on April 22, 2011
When: April 26th 5:30pm-7:30p
Where: Ted’s Restaurant
328 12th Street South
Birmingham, AL 35233
RSVP!
How do you turn your passion into a business?
What tools do you use to build your audience?
How do you create a memorable brand?
Ask Alison Lewis of Ingredients, Inc. Alison has built a successful business by strategic branding and creating her own “media” that has gained a national following.
Learn what was the right mix for her in building her online and offline persona.
So you want to start a business?
Posted in: Business Development, Startup by jrobinson on April 14, 2011
Everyone has ideas. Ideas are sexy, fun to talk about and fun to dream about. It’s pretty intoxicating to consider that this little idea you have could change your market, provide a much-needed service, or secure a big paycheck. But, executing and building a company around your idea is a whole new animal.
When I started my first company three years ago, I was admittedly a little lost. I’d had no business classes in college and hadn’t yet had a post-graduation job. But, I knew my idea would deliver a valuable service, so I started down this road. There have been times when I couldn’t wait to move forward and keep building, but other times when I’ve just wanted to quit. Maybe for an hour or maybe for a day, but when the workdays drag on and the planning keeps you up at night, you want some relief. That relief comes in a big sale, a new contract, or a growing customer base. There are incredible highs and deep lows, but focusing and striving for those “winning” moments can push you right through.
That isn’t meant to discourage anyone from entrepreneurship. Sure, there are concerns & difficulties, but creating a product or service that people grow to rely on is one of the most rewarding feelings I’ve experienced. Customer by customer and dollar by dollar, building a business from nothing is something few care to take on, but those that succeed have complete control over not only their bottom line, but the kind of life they choose to pursue. That continues to be one of my biggest motivators and is the driving force behind many aspiring entrepreneurs.
I want to be very clear – it isn’t easy. Too many people get fed up with their current job and see the appeal in “working for yourself”, “setting your own hours”, or “having more free time”. There’s certainly a misconception of self-employment that goes something like: sleep in, work in my pajamas, do what I want (when I want), and somehow along the way, build a profitable business. If all you want to do is sell baseball cards on eBay, that might actually work.
Once you have an idea and start to move forward, you need all the self-confidence you can muster. You’ve got to be so confident (almost arrogantly so) that what you’re pursuing creates value for potential customers and that you can deliver.
If you’ve got an idea, want to move forward, and aren’t sure where to start, read Michael Gerber’s The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It. Then, keep reading. Listen to podcasts. Subscribe to Inc. magazine. Find a mentor (or two). Follow the right people on Twitter. Talk about your idea to everyone that will listen. Get critical feedback from people you trust. Deconstruct your idea. Consider how you’ll build a business around it. Think through every aspect — creating a website, opening a store, keeping the books, finding customers, keeping customers, building value, studying the competition, developing a marketing plan… The list goes on forever.
I am not an expert on entrepreneurship or telling you how to cash in on your big idea. What I do have is first-hand experience of taking an idea and building a business around it. Sure, it’s a non-stop struggle to create something worthwhile, sustainable, and profitable. Entrepreneurship is a long, hard pursuit that affects every aspect and waking moment of your life. If you can (and want to) take that head-on, then let’s go. It’s an extraordinary ride.
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This post was contributed by Jonathan Robinson, a young entrepreneur living and working in Birmingham. Jonathan’s companies include FreeTextbooks.com (founded 2009) and theClubhouseLeader.com (founded 2010).
6 Things you want to know before looking for funding
Posted in: Blog, Funding by Brian Cauble on December 5, 2010
So you’ve determined that you need some money to build the next Facebook or create the next Viagra. Well, I’m not a full fledged expert about raising capital, but I’ve learned a few things from talking with investors, venture capitalist, and people who’ve successfully raised capital. While this list isn’t exhaustive, you need to know these things if you hope to raise money.
- Build your projections bottom up – Entrepreneurs often tell investors something like “If we capture 1% of total market, our revenues in year 1 will be $1 million.” This generally makes you look naive to investors at best. You need to look at it in terms of what is realistic. Think that you can get 10 sales per month in the first 3 months, 13 sales per month in the next 3 months, and so on. Be prepared to show something along these lines. Also, be prepared to back it up by showing why this will happen. For example, you will be adding two full time sales people that are expected to produce these sales.
- Ideas are cheap - I know you think you have a brilliant idea and it’s going to change the world. However, you need to have created something and likely you will need some sales or users. An angel investor (small $’s) may invest in just an idea but it’s not nearly as likely these days. These days, venture capitalists put their money on what they call implementation risks. That means that you have a successful company and they are betting on you being able to grow really quickly if they give you money.
- You need skin in the game - Time and time again, you will see entrepreneurs ask for money without any real risk to themselves. They haven’t drained their retirement account, quit their full time job, or borrowed money from family & friends. If you don’t believe in your ideas enough to go all in, investors generally won’t believe either.
- You can’t be a mess – If you are a financial or personal mess, it will hurt you when raising money. If you’ve had 4 divorces or declared bankruptcy 5 times, you probably aren’t getting any money. Investors will assume that if you are personal or financial disaster, you will do the same thing to the company.
- Don’t lie - Don’t lie about deals in progress or a personal problem. Many things can be worked around, but investors don’t like being lied to, and if they are going to give you $3 million, they are going to check into you pretty hard.
- Experience matters - Investors bet on successful teams and successful people most of the time. If the company you started is in bio-tech and you used to be an insurance salesman, it is going to be hard to raise money. It will also work against you if this is your first company. That doesn’t mean you won’t be the next Mark Zuckerberg, but it will make it more difficult to raise money.
I truly hope this helps you if you intend to raise money. Like I said, it’s not exhaustive, but you need to be aware of these things before you walk in to pitch your idea. Good luck and let me know what other things you think people need to know when raising money.
March Event
Posted in: Featured by Brian Cauble on March 9, 2010
Location: Shift Workspace
Time/Date: March 10th at 6pm
Sponsors: TBD
Speakers: Chase Morrow, IT Rockstars
Come and join other entrepreneurs to hear listen to Chase Morrow discuss how he co-founded and eventually sold his share of ITAC Solutions. Chase is sure to offer a very interesting story of his ups and downs. Currently Chase has founded two new companies.
We are still looking for a meeting sponsor. If you are interested in sponsoring, please send me a note. As always, thank you to Peter Maynard for sponsoring us for the year. Please take a minute to visit Peter’s website and say hello to him at the event. Our sponsors make these events possible.
Sincerely,
Birmingham Entrepreneur
Borrowing money to fund expansion
Posted in: Blog, Funding, Uncategorized by Brian Cauble on September 13, 2009
You have a few options if you need a decent, but not huge, amount of money. There are three main types that I can think of that would apply in this situation: Debt Financing, Equity Financing, and Commercial Finance.
Debt financing means taking out a loan. Not all loans are created equal and some will want you to put up your personal property, others will not. I would consider going to the Small Business Association. It is their mission to help people like yourself. Also check with any bank that you have a long standing relationship. They will definitely want to look at your business finances to determine if they think you will be able to pay them back.
Equity financing means taking an investor. When you need 50,000 to 500,000, Angel investors can be a good option. The key is they will be looking for a good return on their investment. So if your company is likely to grow slowly, I doubt they would be interested. The Birmingham Angel network is one place to look at.
Commercial finance means borrowing from a lender based on your business assets. If you have anything worth money in your business (real estate, equipment, stocks, A/R, etc), you can borrow against this. Porter capital is a local firm that does this. It is a loan, but only against your business assets.
I hope that helps you get the money you need. For what it is worth, I am discussing having Superior bank talk in November about this subject at a meeting.
“Making it Official”
Posted in: Uncategorized by Josh Andrews on July 13, 2009
Many entrepreneurs make money with their ideas before they ever “make it official” and form a company. If you ask ten different people when you should “make it official”, you will likely receive as many answers. Here is my take on when it is time to make “make it official”.
If you have an idea that makes money and requires no overhead and you will never have customers or clients coming on your property or who might be angry about something you (or someone who works with or for you) sell or do, you are probably okay to operate as a sole proprietor (or a partnership if there are two or more of you).
If, however, you will have property, employees, customers, vendors, independent contractors, or any other relationship outside of yourself to make your business venture succeed, you might want to consider “making it official” and forming a company separate from yourself.
All the available legal business entities do one thing for the owner: protect from liability. If you decide to “make it official” and form a company for your business venture you will be protected from claims by employees, independent contractors, vendors, actions taken by those in your employ, injuries incurred while on your property and contract liabilities. Essentially, when you create a company separate and apart from yourself, you have created a way to protect and limit your investment in your business.
It is important that all entrepreneurs wisely consider creating a shield to separate their personal assets from their business assets. It is the only way to ensure that the investment you choose to make in your business is the only investment you make. Without proper planning, you can unintentionally invest everything into your business because of one mistake.
That is not to say that when you create a company you are protected forever. You must be careful to maintain the appropriate company formalities, make sure your company has enough money to exist apart from you, the owner, and make sure that you keep all your personal activities and the activities of the company separate.
The reason for the formality requirements is to keep you, the owner, from inadvertently subjecting yourself to personal liability. For instance, you must always sign agreements for the company in your official capacity with the company. If you neglect this important formality, you could subject yourself to personal liability related to your personal signature on the document.
I would also encourage you to “make it official” with the advice and ongoing counsel of a qualified attorney. You don’t want to take shortcuts playing with your assets. If it is time for you to “make it official”, you want to do it right the first time.
Starting a business – my overwhelming, inspiring, terrifying, amazing journey
Posted in: Blog, Startup by Brian Cauble on July 10, 2009
Just so you know, I am a bit exhausted at the moment. I should probably be working (or sleeping) instead of writing this post. But I want to tell you about my recent journey.
I have started a company, two in fact. One of my companies is a mobile phone software development company called Appsolute Genius. The other company is a non-profit called “Birmingham Entrepreneur”. Sound familiar. Why did I do it? Because I caught the bug: the “I am passionate about these things and this is what I want to do with my life” bug.
Birmingham Entrepreneur started as a way for me to get more involved in the entrepreneur community in Birmingham and to keep me focused on entrepreneurship. I never expected to love it so much. I love doing it. To most people it sounds like work. I take time to meet with entrepreneurs, post blogs, post links and send tweets about entrepreneurship, look for sponsors, look for meeting locations, look for speakers, try to market the group. It is actually a lot of work. Work that I currently don’t get paid to do. But it isn’t just work to me. It is a passion and a mission. I have a mission to make Birmingham Entrepreneur special. I have a vision where Birmingham Entrepreneur can make a difference in this city and really help it grow. It may sound crazy, but I believe it is doable and I believe I am the person to do it.
Appsolute Genius is my mobile phone software company. Now I am a geek. It took me a long time to come to grips with that statement, but I am. I love technology and I love how technology improves our lives (when done right). For example, Social media allows me to meet more people than ever and to keep in touch with friends and family I wouldn’t otherwise keep in touch with. Mobile software allows me to run my life more efficiently and makes my life more fun everyday. I love seeing how mobile technology is changing our lives. I understand technology on a human (emotional) level, and I love it.
So now that you know what I am doing with my life, let me tell you what it has been like. So many words come to mind: scary, exhilarating, lonely, fun, amazing, overwhelming, inspiring. Many days I feel all of these emotions. You will hear so many people tell you to be passionate about your business. They are 100% correct. Why? Because it is extremely difficult and you will probably give up if you don’t love it and believe in it. You have to be willing to do whatever it takes. I am so tired as I write this, and I have doubts from time to time. However, I know that this is the life I want. And I know that whatever it takes, I will make it happen.