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Direct from The Six. World renowned. Canada’s largest city. With Canada’s biggest thinkers, visionaries, and hustlers, this is Startup Talk podcast episode 17 featuring the founders, funders, innovators, and community leaders who have led Canada’s startup ecosystem right here in Toronto. You’ll hear the challenges, the failures, the successes. Toronto’s Startup Podcast gives you the full the story direct from the entrepreneurs and influencers who’ve made a difference. Now, the host of Startup Talk, the founder of TorontoStarts, the Startup Coach.
The Startup Coach: Welcome to an Ask The Startup Coach episode of the Startup Talk podcast. Today’s question, what is intellectual property? To answer, I speak with Erika J Murray, serial entrepreneur who has a true passion for scaling startups. As a PHD in Engineering, and an IP lawyer, she draws upon extensive background and real life experience to deliver practical business and IP advice to high growth companies. Let’s get right into the interview.
Welcome back to Startup Talk episode 17, it’s the Startup coach here, and I’m here with Erika J. Murray, an IP lawyer from PCK Intellectual Property. Tell me a little about you and PCKIP.
Erika J Murray: Hi Craig. Thanks for having me. Basically PCK Intellectual Property is a law firm that obviously specializes in intellectual property. It’s a boutique law firm that’s been founded about 15 years ago by Stephen and Andrew and they’re located in Toronto and Waterloo, Boston, as well as Washington, DC. So we are a Canadian and US intellectual property firm. I, myself, am an intellectual property lawyer with a background, so I have a PHD in Engineering.
The Startup Coach: And you’re a serial entrepreneur as well and that’s kind of where I’ve known you from before all of this. And just for the record I sent a lot of companies to PCK IP when they’re looking for IP stuff. So its interesting coincidence that you happen to be working there now. So, let’s start at the beginning.
What is Intellectual Property?
Erika J Murray: Intellectual property is an intangible asset. So, unlike when you buy real estate, you can step on the ground of your house and that’s property. So that’s tangible asset. Whereas intellectual property is intangible, so you can’t step on it or see it and it’s essentially a right to exclude others and granted from the government.
Why should startups care about IP? Why does it matter to them?
Erika J Murray: Intellectual property is fundamental to a startup in a way because generally you’re innovating when you form a startup. It’s not always the case, you could have a startup which is just a simple storefront selling chips, right? But in this space, which you typically have founders, they’re innovating so they’re in a new space, creating new business models, generating new ideas. So it’s important to understand what intellectual property other companies have, so your competitors, as well as your branding. So your trademarks and your logos. So basically from both a protection standpoint as well as a defensive standpoint.
What’s the difference is between copyright versus trademark.
Erika J Murray: Copyright is the exclusive legal right to produce, reproduce, publish original artwork you could think of it or it could be musical work, et cetera. Oftentimes we give the example of the painting of Mona Lisa, and usually the copyright owner is the creator. So just from making that painting, they have copyright in that work of art. Whereas trademarks deal with what you would think of as branding. So your company’s logo, slogan, it could be a symbol or design associated with your branding.
What can be trademarked?
Erika J Murray: Yes. You can trademark various types of things, you can even trademark a sound, but typically startup companies look at trademarking their brand. So what they become known in the marketplace as. So it’s different than their incorporation name, if you have a slogan, or something catchy. So it’s what you associate your goods and services with.
What’s the process like for getting a trademark and how long does it usually take?
Erika J Murray: The first step to getting a trademark is essentially filing your trademark and that takes a week or two to prepare. You may want to do a bit of searching prior to. Once we’ve filed the trademark application, then the government essentially reviews these applications and it’s the government who gives yes or no or maybe, and it can take up to nine months to get a first response from the government. If you get a yes, then perfect. But it is common, no matter what, to perhaps get what we would call an office action or some objections as to why you may not get the trademark.
It doesn’t necessarily mean you won’t, but it does mean that some response is required in order to pursue that trademark. So I would say, usually, if your trademark is able to be registered, a year and a half, two years.
The Startup Coach: Okay, a year and a half, two years.
Do startups need to register their trademarks in the US and in Canada?
Erika J Murray: We always advise startups, so even if the startup is located in Canada, they should register their trademarks in the markets they’re operating in. So wherever they have customers and wherever their brand is valuable and has recognition. So, here, startups tend to basically sell in Canada and scale in Canada, it’s not always the case, but if you do file in Canada you have six months then to enter the US. So North American protection is usually what startups do eventually end up getting.
How much does it usually cost to get a trademark?
Erika J Murray: In Canada, there’s a government fee as well as then say a lawyer’s fee to help you prepare the trademark. So it can range between 500 to $1500 is approximate. Now some lawyers or if you have a very complex trademark it could be more, but that’s, you know, our high end is usually around $1500.
The Startup Coach: That sounds quite reasonable. So we talked about trademarks.
How do trademarks differ from patents? And what is a patent?
Erika J Murray: Again, a patent is the right to exclude. So patents, specifically when we’re talking about patents, we’re generally talking about what’s called a utility patent, which focus is on the functionality. So it could be the functionality of a new device, a medical device for instance. So a patent is a document, okay, and it gives you the right to exclude others from entering your space.
The Startup Coach: And so your space would mean your area of the marketplace? Your geographic area?
Erika J Murray: No, it’s not to do with marketplace, it’s to do with your innovation. So in a patent, it starts with say the description of the problem you solve, it can outline in high level perhaps what some of your competitors are doing, now you wouldn’t mention your competitors by name, but then it specifically shows drawings and the innovation that you’ve created. And it is associated with your business and your innovation. But it’s essentially a very technical, legal document describing your innovation.
What is the patent process like and how long does it take?
Erika J Murray: The patent process is significantly longer than the trademark process. Now all of this is just generally, but the first step specifically for startups, and most companies, even mid scale companies, you generally start by filing a US provisional patent application and that starts with making a disclosure. So a document that describes what it is you do and different variations that you could accomplish with your innovation. And that gets filed. A year from that date of filing, then we have to formalize that patent application and it could take, if it’s approved and there’s various responses back and forth, it could take up to three, four years to get an issued patent. Now I’m just saying that as a guideline. It could be two years, et cetera, and it also very much depends on which countries you enter.
The Startup Coach: So when you say which countries you enter,
Do we need to get a patent in Canada and the US and what about Europe and abroad?
Erika J Murray: All, or I should say most, intellectual property rights, you need to enter each country. So there’s no such thing as a quote unquote worldwide patent although you’ll hear people say it. So again, going back to what we talked about trademarks, it’s always important to focus on your biggest market. You will not be able to … no company generally enters every single country and files their patent in every country. So you start with a US provisional application and then if most of your business is going to be in North America, then we file in Canada and the US.
To file a provisional application, there are various ranges depending on the technology however we have so many startup packages and we work with founders at a very reasonable price to get a provisional patent filed. And then over time we say allow $30,000 over the three to five year period per country to get an issued patent.
The Startup Coach: Is that because there’s a lot of back and forth sometimes where you need to re-engage?
Erika J Murray: Yes. So basically, you know, we do what we call lean start up provisional patents for a thousand dollars. So for startup companies, we will help them write their provisional, well not, we won’t write it for them, but we will coach them on how to draft their own provisional patent applications. We’re happy to do it. And so there’s a low cost, I mean a thousand dollars is still a cost to a startup, but it’s a low investment at first and then the price gets much higher and a lot of that higher cost is because always the government responds saying you need to amend your claims essentially.
So it’s never the case that we file a patent application and the government says yes, here’s your issued patent. All the time, that’s the government’s job when it comes to kind of patents, is they take the position that your patent is too broad and you need to narrow it. And I mean that’s our job also is to try and get you the broadest set of claims so, you know, that’s what patent agents and lawyers do is to draft it broad and then the prosecution, the back and forth over the two to three year period, does take time and of course that time costs money.
When should a startup start thinking about intellectual property?
I think it’s good to be on every startup’s radar. I would say earlier the better to at least understand what is a trademark, kind of what we’re talking about here today. What is a patent? How much does it cost? And really having an eye on the competition and what kind of intellectual property that they have filed and they’re working on.
I’ve seen a lot of startups specifically very early stage want to say file their trademarks right away. I actually wouldn’t advise rushing to file your trademark. Too many companies change their logo, change their name, get new slogans, right, so you really should file, for instance your trademark, once you have some sort of brand recognition. So if people are starting to know you as company XYZ, oh you’re company XYZ with product ABC, oh you’re … you know, then you should really be thinking about filing your trademark so that no one else can basically start that branding ABC in Canada, okay? So, for trademark it would be when you start to have that brand recognition or I guess if you have the money, and you want to just file it straight up for the fee of $1500 max and then get your early protection, you could do that. But is it necessary? Not immediately.
For patents, as soon as you I guess believe that you have something very innovative and it’s an edge in the marketplace and a distinctive aspect of your technology and your company, then working on a provisional patent application filing would make sense.
Where can people go to find out more information about you, about PCK IP?
Erika J Murray: My firm, PCK Intellectual Property, we have a whole bunch of information, legal blogs, et cetera, so there’s a lot of free resources there that startups can read. There’s also, you know, we’re happy to do office hours, reach out to me, set up meetings. So my email, firstname.lastname@example.org or just email the firm and we’ll be happy to have a call and we’re always at events, just approach us and have a quick chat.
The Startup Coach: And I’ll put links in the show notes. Thank you very much Erika for being on Startup Talk today.
Erika J Murray: Thank you Craig.
This has been Startup Talk episode 17 of Toronto’s Startup Podcast. For more exclusive content, the episode vault, and to be part of TorontoStarts community, visit torontostarts.com. Get your name on the newsletter mailing list and check out our upcoming events. For more episodes, subscribe now, and please recognize the time and work behind the scenes put into connecting you with the biggest visionaries, entrepreneurs, and innovators in Toronto by leaving a 5 star review. Join us for more next episode from Toronto’s most active entrepreneur and startup community on Startup Talk.