Why Technology Startups Should Consider University-Created Intellectual Property

By George Likourezos, Esq.

Partner, Intellectual Property Attorney at Carter, DeLuca & Farrell LLP

The success of technology startups depends on factors such as the strength of the team to be able to execute and the intellectual property (IP) backing the technology being developed. While generating intellectual property in-house is the focus of many technology startups, they can also be well served by branching out and considering intellectual property developed elsewhere, and universities are good places to find and license, often on very favorable terms, cutting-edge technologies. That is, university-created IP can be a valuable resource for licensing to bolster a startup’s intellectual property portfolio. Here are more reasons why university IP can be advantageous for startups:

1. Technological Innovation:

            Universities are often at the forefront of research and technological innovation. Licensing IP from universities can provide startups with access to cutting-edge technologies and inventions.

2. Diverse Expertise:

            Universities house experts and researchers in various fields. Licensing IP from a university allows startups to tap into the diverse expertise available within the academic community.

3. Competitive Advantage:

Acquiring university-developed IP can provide a significant competitive advantage. It allows startups to differentiate themselves by incorporating novel and unique technologies into their products or services.

4. Accelerated Development:

Licensing existing university IP can accelerate the development process for a startup. Instead of starting from scratch, startups can build upon established research and prototypes, potentially reducing time to market.

5. Access to Funding Opportunities:

Startups that leverage university IP may have access to funding opportunities and grants specifically designed to support the commercialization of academic research.

6. Strong IP Foundation:

University-developed IP often comes with a strong foundation of research and testing. This can enhance the credibility and reliability of the technology being licensed.

7. Collaboration Opportunities:

Licensing university IP may open doors to collaborative research opportunities between the startup and the academic institution, fostering a mutually beneficial relationship.

8. Increased Visibility:

Incorporating university-developed IP into a startup’s portfolio can enhance its visibility within the industry and attract partnerships, investors, and customers interested in innovative technologies.

9. Potential Cost Savings:

Licensing university IP may be a cost-effective way for startups to access advanced technologies without the substantial upfront costs associated with in-house research and development.

10. Tech Transfer Offices Support:

Universities often have technology transfer offices that facilitate the licensing process. These offices can provide valuable support in negotiating licenses, ensuring compliance, and navigating legal considerations.

While there are clear benefits, it’s essential for startups to conduct thorough due diligence before licensing university IP. This includes understanding the terms of the license agreement, assessing the strength of the IP, and considering potential challenges or restrictions associated with the technology.

Additionally, startups should work closely with legal and IP professionals to ensure a smooth and compliant licensing process. A resource to consider is the intellectual property law firm of Carter, DeLuca & Farrell.  Carter DeLuca can also provide guidance and representation to technology companies as they build and expand their intellectual property portfolios. Carter DeLuca has assisted hundreds of companies scale and grow, avoid patent infringement, identify investors, and protect their intellectual property, and has also assisted many investors in making informed business decisions when investing in technology-based companies.

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