Startups, does your intellectual property belong to you?
Source code, trademarks, patents, designs: how to verify your startup actually owns all its intellectual property.
The value of many startups rests on their intellectual property. Yet too often, founders neglect to verify that ownership of their developments actually belongs to the company. This can have serious consequences when the developments are commercially exploited, or when the company is sold.
It is essential to verify from the outset that your company owns everything it develops, whether in-house or externally. Here are the key points to check. During a fundraising round, investors will examine these elements systematically — see the article on transfer clauses in fundraising.
Software may be developed in-house by a co-founder, or by engaging a freelancer. Under French law, ownership of the code belongs to the developer in both cases. It is therefore essential to ensure that the developer has signed a compliant IP assignment agreement: rights assigned, permitted uses, territory, and duration.
Without such an agreement, the developer could claim ownership of the developments at any time. The company’s use of the code would constitute copyright infringement. For further detail, see the article on essential clauses in a software development contract.
As an exception to general copyright rules, software developed by employees automatically belongs to the employer. No specific action is required.
Texts, visual works, videos, audio works and all other copyright-protected works belong to their author. For co-founders and freelancers, an IP assignment agreement is required. For employees, a clause in the employment contract may serve this purpose, but the relevant works must be specifically identified — general copyright assignment clauses are invalid. For further detail, see the article on employer’s rights over employee works and inventions.
A trademark belongs to the person who registered it. If a co-founder registered the trademark, they must either assign ownership (trademark assignment) or grant exploitation rights (licence) to the company.
The regime is similar to trademarks for non-employee inventors. For employees, three categories apply: mission inventions (employer’s property, with additional remuneration for the employee), attributable non-mission inventions (employee’s property, but the employer may claim attribution with fair compensation), and non-attributable non-mission inventions (employee’s property).
A design belongs to the person who created it, regardless of registration. An IP assignment agreement is therefore required in all cases. For an overview, see the intellectual property services page.
Verifying IP ownership is a reflex that should be adopted from the moment your startup is created. A failure to assign IP rights can block a fundraising round or a company sale. If you need to audit your IP, book a call.
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I have been supporting software and SaaS companies for over 10 years, helping them structure their business, protect their intellectual property and strengthen their contracts.
