Entrepreneurship for IST/SRA Innovation Prof. John W. Bagby on for Prof. Sandeep Purao’s IST 110

Entrepreneurship Field Cool Idea(s) Fire in the Belly (Passion & Profits) Methodical Preparation –IP: Invention, Innovation, Design –Business Plan –Assembling Resources: Team Seed then Permanent Financing Organizing for Success

Essential Business Plan Strategic Plan & Guide for Action –Goals, Objectives, Implementation Market Analysis: Competitive Advantage –Novel Product/Service Role in Market –Customers Really Exist Profitability Projections Marshaling Resources –Financing & Financials –Marketing Plans –Operational: Mfg. Production, Supply Chain, Staff

Venture Capital (VC) Investment Needs –Critical Mass Needed & Seed Financing –R&D, Product/Plant/Equip, Working Capital –Source: self, family/friends, loan, partner, angel, micro-finance, VC, Going Public Venture Capital –Hi Risk Equity Investors –Private Equity vs. Going Public

VC Impact Cyclical: Bubbles

VC Structural Design

Form of Business Organization Sole Proprietorship Partnership or Joint Venture Incorporate –Capital Structure of Securities –Tax Advantages Other Limited Liab.Forms: LP, LLP, LC Many Key Variables: –Ownership vs. Control –Tax Consequences –Insolvency Risk

What forms of IP Might be Appropriate? Copyrights Trade Secrets Patents Unfair Competition (databases, characters) Trademarks & Trade Dress Sui Generis Protections: – Semiconductor chips, asexual plants, designs, petty patents, Databases, boat hull design

Copyright Must be an Original Work Must be Fixed in a tangible medium of expression Must be Perceivable directly or indirectly by humans Software is Literary Work Idea vs. Expression Dichotomy

Types of Copyrightable Works Literary works Architectural works Sound recordings Motion pictures and A/V works Pictorials, graphics, and sculptures Musical works Dramatic works Pantomimes and choreography

Trade Secrets information –formula, pattern, compilation, program, device, method, technique or process derives independent economic value –from secrecy, and subject of efforts to maintain secrecy –reasonable under circumstances

Patents Patentability –Subject Matter Process, Machine, Manufacture, Composition Business Method Patents –Novelty –Non-Obviousness Patenting –Prosecution Costly & Protracted IP Strategy –Trolls, Portfolios, Claims Drafting, Negotiations

Trademarks Word, Name Symbol, Device –Recently: color, sound, smell Identifies Source of Goods or Services –Distinguishes from competitors Promote business ethics –Prevent palming off Spectrum of Distinctiveness – a Scale of Decreasing Protectability –Arbitrary or Fanciful –Suggestive –Descriptive –Generic

Software Product EX Always Copyrightable Seldom Patentable – BMP Process – Non-Obviousness & Novelty Nearly Always Trade Secrets – NDA, EULA decompiling prohibition Commercial Software Trademarked Technology Transfer Restrictions – DeCompilation; Works Made for Hire-Author, Licensing, Assignment