It’s every entrepreneur’s dream: come up with a great idea, build it into The Next Big Thing (TNBT), hire a business lawyer and incorporate it, and sell the now wildly successful TNBT, Inc. for millions of dollars. Unfortunately, it doesn’t always work that way – not because TNBT wasn’t a great idea, but because the idea that became TNBT wasn’t adequately developed or properly protected.

Let’s face it. Most new and small businesses are undercapitalized. Struggling entrepreneurs will hire a lawyer to set up their business entity, but then think they can’t afford to hire a lawyer who specializes in developing and protecting their most important asset – their intellectual property (IP). The reality, however, is that your new business can’t afford not to get good IP advice.

Intellectual property may sound complicated, but it is really just ideas that have been put into a tangible form – a patent for an invention; a trademark to identify a product or service; a copyright to protect an original work of art; a domain name that identifies your company to the world on the Internet. IP is also a business asset. In fact, it is often the most valuable asset a company owns. And like any other asset, IP requires investment in order to develop and enhance its value, and protection to keep that value from being eroded or stolen.

Most inventors are aware of the need to obtain patent protection and are probably resigned to the fact that they will need to spend a significant amount of money to obtain a patent. However, when it comes to selecting the name, slogan, logo or marketing theme for this new product (or for any new product or service, regardless of whether patent protection is necessary), even the most savvy entrepreneur may think they can “wing it.” This can be a very expensive mistake.

The name a company uses to identify its product or service – its trademark – can be enormously valuable, and the entrepreneur should give name selection every bit as much attention as they give to any other foundational part of starting their business. There are a number of common pitfalls in this process. Selecting a name or a logo that is already being used by another company on a similar product or service is an obvious problem, but one that may not present itself until after considerable time, expense and emotional capital has been invested in your new brand. The day after your major product launch is not a good day to get a cease & desist letter – or to be served with a lawsuit! All the time and money you spent to promote your new brand has been wasted.

This problem can be avoided by obtaining competent trademark counsel to clear a name well in advance, but even more value can be added by working with trademark counsel to try out several names and to think through an overall branding strategy, including slogans, logos and marketing themes that can grow with your business. It is almost never too early to begin this process, and this front-end investment can pay big dividends in both costs/risks avoided and in enhanced value of your company’s mark.

Another common mistake is to think that checking with the Secretary of State for name availability prior to incorporation, or seeking a state trademark registration, gives you rights or protects your trademark against any other user. It doesn’t. A corporate trade name does not confer trademark rights, and a state trademark registration provides about the same amount of protection as not having a registration at all. Trademark rights are territorial – you can develop common law rights in the geographical area where you are exclusively using the mark, but only a Federal trademark registration gives you a presumption of the exclusive right to use the mark on your goods or services throughout the country. That exclusive right enables you to expand your business nationally using your mark, and will dramatically enhance the value of your company to a potential investor or acquirer. Of course, because a strong trademark portfolio is such an important long-term investment, it is prudent to retain competent trademark counsel early on to assist in obtaining and maintaining that portfolio.

Finally, a far-too-often overlooked problem is the failure to keep trademark registrations up-to-date and in the name of the proper owner. Every entrepreneur knows that start-up companies can go through multiple changes in company name, as well as changes in business structure, investors or partners, mergers and the like. Company trademarks don’t automatically tag along with the company as it is evolves, but as with any other type of property, they must be properly transferred or assigned in order to avoid a break in the chain of title. It can be devastating to be finally ready to close on the big deal that is going to make you a millionaire, only to find that somewhere along the line you “lost” your intellectual property assets.

Trademark counsel can partner with you from the inception and development of TNBT in order to help you create a strong brand and maximize TNBT, Inc.’s IP value for its eventual sale. Your dream is a reality, and you can get on to The NEXT Next Big Thing – with your trademark counsel at your side.