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Did you know Airbnb has 1686 patents to its name? Coke has protected it’s recipe as a trade secret for more than 130 years! And Apple’s design patent covers the iPhone’s iconic shape, design features, including its two-tone aluminium back, home button layout, earpiece, mute, and volume controls. 

In today’s innovation-driven economy, intellectual property (IP) is the key to success for startups. Identifying and protecting your IP as a startup helps to safeguard your unique creations, makes you more investment-friendly, and unlocks a wealth of opportunities for business growth through licensing, sales, strategic partnerships, and more. 

In this guide we discuss the different types of IPs, startups that have excelled in their IP strategy, and steps and considerations for Canadian startups looking into IP protection and management.

What is the Meaning of Intellectual Property?

Intellectual property (IP) refers to creation of products, artistic or literary works, inventions, and logos that are legally protected. They are intangible assets, preventing unauthorized use, distribution, or sale. 

Maximilian Yam, an associate at BDC Capital, emphasizes that an idea alone does not qualify as IP, it must be expressed in a form that can be legally protected. Owners of IP have exclusive rights to control how their asset is utilized, meaning it cannot be sold, used, or distributed without their consent.

Main Types of Intellectual Property in Canada

Each type of IP is designed to protect different aspects of creativity and innovation, offering various pathways for businesses and individuals to safeguard and monetize their efforts.

Here’s a breakdown:

  1. Patents

Patents grant the inventor exclusive rights to prevent others from making, using, or selling their invention for up to 20 years in the country or region where the patent is granted.

The invention must be:

Examples of what you can patent in Canada include, products, processes, machines, chemical compositions, and improvements or new uses of any of these.
However, not all inventions are patentable in Canada, one such example is surgical methods or new animal breeds. Read more on the Canadian Government guide to patents here.

2. Trademarks

Trademarks protect letters, words, symbols, designs, tastes, textures, moving images, modes of packaging, holograms, sounds, scents, 3-dimensional shapes or colours (or a combination of these) that distinguish goods and services in the market, effectively representing a brand’s identity and reputation. 

A trademark protects your brand across Canada, and they are renewable every 10 years in Canada. Read more on the Canadian Government guide to trademarks here.

3. Copyrights

Copyrights provide exclusive rights to creators of original works that exist in a fixed material form (written, recorded) like books, music, and art, allowing for the reproduction, performance, and creation of their creations provided the conditions set out in section 5 of the Copyright Act have been met. 

These rights aim to encourage the creation and sharing of art and knowledge while protecting creators’ interests.

Examples of what you can copyright include, books, pamphlets, computer programs, software and other works consisting of text, motion picture films, plays, screenplays and scripts, musical compositions with or without words, paintings, drawings, maps, photographs, sculptures, and more. Read more on the Canadian Government guide to copyright here.

4. Industrial Design

Industrial designs protect the unique visual appearance of a product, like its shape, pattern, or overall look. 

In Canada, registering an industrial design gives you exclusive rights to it for up to 10 years. The design must be original and registered within a year of its first publication. This registration only covers how the design looks, not how it works or is made. Read more on the Canadian Government guide to Industrial Design here.

5. Trade Secrets

Trade Secrets cover confidential business information, methods, or practices that offer a competitive edge due to their secrecy. While a very powerful tool, trade secrets might not be suitable for all forms of IP, especially if the secret can be recreated by competitors easily. 

Examples of what is considered a trade secret is, a method, a technique, a process, research and analysis data, a formula, a recipe, a device, an instrument, etc.

Trade secrets are typically used to keep valuable business information secret before getting a patent or other formal IP protection, or to safeguard innovations that are not covered by any other IP rights. Read more about Trade Secrets.

Examples of Notable IP-Focused startups

Airbnb: Airbnb has an extensive patent portfolio, including 1,686 global patents with over 61% active ones. This collection of patents stem from 762 unique patent families, underscoring Airbnb’s commitment to research and development, particularly in its primary R&D centres in the United States, United Kingdom, and South Korea.

Graph showing the airbnb patent portfolio patent filing trend


Most recently, a notable patent application by Airbnb involved a “cross-listed property matching” system, designed to detect if a property is listed on multiple vacation rental platforms. This system utilizes image comparison and machine learning to identify similarities across listings, even when images or descriptive details vary, to manage and optimize its property inventory, fees, and marketing strategies effectively. This technology will mitigate scams and ensure the uniqueness of listings on Airbnb’s platform.

Spotify: The world’s largest music streaming service, founded in Sweden – Spotify has dedicated a lot of resources to research and development, pioneering advancements in streaming technology, recommendation engines, and user interface design. To safeguard these innovations, Spotify regularly registers numerous patents, currently maintaining 614 active patents.

Most recently, in 2023, Spotify secured a patent for a feature that allows users to create and share digital mixtapes. This new functionality lets users compile a selection of media from Spotify’s catalogue and personalize it with their own voice messages or audio for intros and transitions.

InteraXon: Representing Canadian innovation, Muse develops groundbreaking neurotechnology. This Toronto-based tech company, has introduced Muse, a smart headband designed to serve as a personal meditation coach. Incorporating advanced EEG sensors, Muse tracks brain activity and delivers real-time feedback through audio cues to enhance meditation practices.

AI image of a person with eyes closed listening to music


The company’s innovative approach is deeply integrated with its IP strategy. They actively utilize insights from existing patents to inspire new ideas and continual improvements. This focus on IP not only helped attract initial investment but also supported the ongoing development and commercialization of its technology, laying a foundation for future patents. InteraXon has built a culture around IP, engaging both technical and business teams in the protection process and combining various forms of IP rights to fortify its portfolio.

Determining Your Company’s Intellectual Property

If you’re finding it difficult to figure out what parts of your business product, service, design, process, or work can be considered IP, try an IP audit which can help in identifying the various forms of IP within your startup.

Steps That Startups Can Take to Secure Their Intellectual Property

Safeguarding your IP does not necessarily mean heavy legal fees, if you’re on a tight budget you can still protect your IP effectively by focusing on simple strategies.

4 Ways That Startups Can Monetize Their Intellectual Property

Now that you know how to identify your IP and safeguard, let’s talk about monetizing them. There are several strategies you can employ to maximize your IP’s value and generate revenue. Here’s an introduction to some effective ways to monetize your IP:

  1. Licensing and Franchising: This involves allowing another party to use your IP in return for payment. Licensing can cover various aspects, from manufacturing to distribution, allowing the licensee or franchisee to handle these operations. It’s a way to spread your brand and products with less direct involvement in the day-to-day operations. A classic example is McDonald’s franchising model. McDonald’s licenses its brand, business model, and other IP to franchisees who operate their own restaurants under the McDonald’s name. The franchisees pay McDonald’s for the use of its IP, including trademarks and proprietary business practices, in exchange for operational support and the right to sell McDonald’s products.

2. Assigning (Selling the IP): If you’re considering a pivot in your business direction or looking to exit a particular innovation field, selling your IP might be a viable option. This entails transferring your IP rights to another entity in exchange for a lump sum, offering a direct financial benefit from your intellectual endeavours. Back in 2011, Google acquired Motorola Mobility for $12.5 billion to enhance the Android ecosystem. By bolstering Google’s patent portfolio through this purchase the company’s intent was to better safeguard Android against what he described as anti-competitive threats from other major players in the industry.

3. IP Collateralization: Using your IP as collateral to secure loans is another method gaining popularity. This approach can be more accessible and less complex than other monetization strategies, like securitization​​.

4. Spin-out Opportunities: Creating a new company around a particular piece of IP to exploit its potential can attract new investment and brand new pathways for your company’s growth. Alphabet Inc., the parent company of Google, is an example of a company continuously creating spin-outs to maximize the potential of its IP. Alphabet has spun out several companies, such as Waymo for autonomous vehicles and Verily in the life sciences sector, allowing these entities to focus on specific technologies and markets.

Whether you choose to license or franchise your IP, or outright sell it, finally, the key is to strategically align the choice with your business goals and the specific characteristics of your IP. 

The Future of Intellectual Property: What You Need to Know

The dynamic nature of technology, coupled with changing legal frameworks, will continue to evolve how IP is managed and protected. Here’s a glimpse into key IP trends that may affect your startup:

  1. Artificial Intelligence (AI): AI’s rapid advancement has been raising significant questions about the ownership of machine-generated creations. As AI technologies become more creative and autonomous, distinguishing between human and AI creativity is becoming increasingly complex. Entrepreneurs will need to prepare to navigate these complexities in the very near future.

2. Digital Age Trademarks: The digital marketplace has transformed trademark considerations. The shift towards online business activities emphasizes the importance of non-traditional trademarks, such as domain names, hashtags, or even virtual goods. This evolution demands more vigilance on the part of startup founders in monitoring and disputing trademark infringements online.

3. Data Protection vs. Open Innovation: As governments worldwide tighten data protection regulations, startups must balance the need for data security with the collaborative spirit of open innovation, much like Tesla’s Open-Source Patent Pledge. But this requires a nuanced approach, and we’ll need to talk about it much more as a community.

4. Indigenous IP Framework: Recognizing and protecting the IP rights of Indigenous communities is becoming a priority in Canada and beyond. Entrepreneurs must be aware of the unique considerations and legal frameworks surrounding Indigenous knowledge and cultural expressions. This involves engaging with these communities respectfully and ensuring their IP is protected through appropriate legal mechanisms.

5. International Trade Agreements: The global nature of IP rights is underscored by international trade agreements, such as the CPTPP and CUSMA. These agreements can significantly impact how IP is managed across borders, affecting everything from patent filings to trademark registrations.

As we look towards the future, it’s clear that the IP landscape is evolving in response to technological advancements and societal shifts. Entrepreneurs must stay informed and adaptable, leveraging these trends to protect and maximize the value of their IP assets.

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