Major benefits of entrepreneurship to the society as a whole

There is no argument on the fact that entrepreneurship brings in many benefits to the stakeholders and various sections of the society. We will touch upon some of the prominent ones here.  

Job Creation 

This is arguably the most important benefit of entrepreneurship to the society. All types of entrepreneurship help create jobs. The category, quantum and potentials of job creation depend on the type of business. For example, the kind and quantum of jobs created by a manufacturing business is different from retail or information technology though there can be job types common across all industries. 

Job creation is very valuable from the perspective of society and economy because that provides livelihood to many people in the society which in turn drives demand for products and services in the market which in turn fuels and accelerates economic development of the country. Needless to say that entrepreneurship helps create indirect employment and small entrepreneurship too.

Innovations

Most of the modern innovations in all the fields of life have come into existence thanks to entrepreneurship. Large portion of  the research and development  activities, whether on products or services has always been part of or results of entrepreneurship. Whatever have become indispensable parts of our contemporary world whether it be television or internet or smartphones or transportation vehicles or home delivery services or taxi aggregators or e-commerce or nanotechnology online payment have all come from the ideas of entrepreneurs. Startups mostly belong to this type of entrepreneurship.   

Change 

This cannot be strictly seen separately from innovation. Some ideas disrupt the way we were doing certain activities or functions. They have helped solve problems which had been remaining without any solutions. For example, online shopping or online payment systems have changed the way we used to shop and pay till recently. It is easy to realise its importance when seen in the context of covid19 pandemic. Entrepreneurship sometimes changes the way we think and do things in life.

Give back to society 

Successful businesses contribute to society by way of taxes to the government. In India, there are statutes like CSR (Corporate Social Responsibility) mandatorily applicable to companies above certain thresholds to spend a percentage of their profit on specified social development and upliftment activities. In addition or more than that, many successful entrepreneurs contribute from their wealth for noble causes or to build non-profit organisations for such causes. Bill Gates, Warren Buffet and back home in India, Asim Premji are some examples of such entrepreneurs. 

Nation building 

Entrepreneurship contributes a lot toward building the nation, particularly its economy. It adds to the GDP of the country and as well some of them earn foriegn exchange. Taxes they pay, jobs they create, infrastructure they build, forex they earn, new products and services they create and all contribute towards nation building by way of economic growth and per capita income increase.

These are only some top most benefits. There are many other direct and indirect benefits that entrepreneurship brings to the nation and society.  

The 4 P’s of Innovation

Product Innovation

Product innovations involve changes in the product or services the start-up or organisation has to offer. Product innovation can involve a change in the design of an existing product or changing the entire product or service. It is important because it helps create new spaces in a seemingly saturated market. As a company, you must identify these gaps and find new spaces to target your audience to satisfy them with a refreshing approach. 

Product innovation doesn’t always involve the creation of a completely new product that tackles a completely new issue. For example, the first computer that was launched was established for a non-existent market targeting the audience who earlier did not have access to such technology. 

Post the first computer, the generations of computers we have been seeing and using are only additional changes and improvements in technologies and designs. For instance, computers were made a more lightweight and more time-efficient post which laptops were introduced to make it more convenient. Thus, innovation may happen when you improve an existing product or you add a new feature to an existing product. When phones got their cameras, they gained a new feature that was an innovative move. And when the camera quality improves, that’s also an innovative move. 

Innovation is not limited to products, it also includes services, processes, or business models. Though they may seem less obvious, they are also important. Recent OTT platforms like Amazon Prime, Netflix, Hotstar etc are prime examples of such innovations. In fact, Airbnb, Uber and Ola also fall into this category of innovation. Focus on listening to the grievances of your customers, understand them, and use their knowledge to anticipate where the market is heading. This will help you ideate and innovate better. 

Process Innovation: 

There has been a shift in the innovation environment due to factors like liberalisation and deregulation of competition, the globalization of markets, increasing demand from customers and growth in technology. This led to a change in the process of production within organizations. 

Process innovation refers to innovations helping companies in aligning their processes in a customer-oriented manner to ensure their business is successful in the long term. Processes consist of the following four elements: process deliverables, process flow, process management, and technologies. 

The production process is redesigned based on market and tech-related changes in the market. The advantages of a process-oriented organization are that companies can adapt more quickly to changes in the business environment. For instance, the major change in the current post-pandemic status quo is companies going digital with their process. Digitalization had already started in the past few years but the pandemic rushed through it. Most companies are going online with sales and customer services. The change in the process might be difficult but has high returns once initiated. The main focus is to meet future customer needs through leading market technologies. 

Is your business eligible to file a patent?

This is the kind of IP that grants a legal right to the owner of such patent against unauthorised selling, marketing, using of such inventions for a limited period of time which is 20 years in India.

For an invention to be eligible for patenting, it should meet the following criteria tests

Patent subject: whether the Invention relates to a patent subject matter.

Novelty: is an important criterion in determining the patent potential of an invention. Simply, it means that an invention that should never have been published in the public domain.

Inventive steps or non-clarity: This means that the invention should not be obvious to a person skilled in the same field where the invention is concerned.

Useful for industrial application: It must be capable of being applied in any industry, which means that it must have practical utility in respect of patent.

In spite of all the laws, rules and statutes in force, there are many rejections of patent applications leading to lack of enough clarity in the applicability of the provisions of laws and mostly this is subject to judgement of the authorities.
Major types or examples of patents are Utility patents meant for tangible inventions, such as machines, devices, new and useful processes, Design patents for the shape, configuration, ornamental designs on manufactured products; mostly applicable to hardware and other tangible products, Plant patents for new varieties of plants

Patentability of an idea is one of the most controversial topics all over the world as there is a very thin line difference between an idea and invention. Though patenting an idea or business method or software or algorithm is possible to an extent in the USA, it is highly unlikely in India. Indian laws don’t accept them as innovations per se. Software will be looked at from an object code vs source code perspective to decide on the criteria of innovation. However, an alternative option of getting an idea, software etc. protected under Copyright laws stands a better chance to succeed. We will not go into the great details of this aspect at this juncture.

We see many players pursuing similar business models in the same domain, like in e-commerce marketplace, technology solutions and aggregator business to name a few. It is, therefore, suggested that startups should not waste time, effort and money in trying to patent an idea that is just on paper. Even when ideas are translated into business, the likelihood of getting an idea patented is remote, else there would have been or can be only one player in one business domain or segment. We are aware of, for example, OLA coming with almost the same UBER business idea or OYO doing something similar to AIRBNB or Yatra and MakeMyTrip or Amazon, Flipkart and Snapdeal or Urban Company and HouseJoy in almost the same business. However, all these companies have many patents registered in their name for individual innovations that have been created during the course of their journey.

There has to be a proper plan and strategy in place on what should be pursued for patents, understanding the laws and procedures so that money and effort spent on creating such inventions will not go drain. An important aspect to be remembered here is the Indian system of ‘ first to file’ norm. This means whoever files an application for a patent for an invention first, gets priority.

There is no doubt about the value add that patents bring to start-ups. Patents provide an edge to patent holders over competitors. It is a catalyst to growth and can be leveraged for business advantage. More importantly for start-ups, patents derive great value in business valuation done by investors depending on the potential of such patents for the future of the business.

Let us look at some benefits of patents

Exclusivity: It gives you the legal power to stop others from copying, manufacturing, selling or importing your patented invention without your consent. If anyone tries to violate them, then they will be liable to legal action in the form of patent infringement. This is applicable throughout the entire lifespan of the patent which is 20 years from the date of patent filing in India.

ROI (Return On Investment) on Patents: Companies including start-ups can generate return on the investment made for developing and obtaining a patent for the innovation. Patents can help companies command premium prices for their products or services. Patents can be monetized through licensing or selling the invention.

Safeguarding market status: IP can help attract leading business partners, investors, and shareholders towards you or your organization for doing business. In India, this also helps in building a good relationship with competitor firms and enhances the value of the company. This will ultimately encourage small firms to participate in the industry as well.

Major challenges in obtaining a patent is that the entire patent registration process requires a lot of investment in terms of time, effort and money. It also requires a fair amount of knowledge about market scenarios, patent laws, and its competitors. It is safe to say that the process is not an easy and straightforward task. It is time consuming but worth trying if proper homework is done.

How trademarks help to promote your products and services

Trademarks, known among laymen as Brands, are the names, phrases, word signature, logos, tagline, sounds, combination of colours, label, device, symbols etc. that differentiate a brand or a company from other brands or companies in the business. They are distinctive and used in business to market, sell or promote a product or service.

Trademarks may be arguably the most important IP that can add value to a startup or any organisation for that matter. In fact, all what goes into patents, designs, trade secrets help enhance brand value. Trademark sums up the visibility and recognition of a company’s value in the public. It can act as a catalyst for increasing the value of a start-up business. Thus, it is important to use a trademark for marketing strategies to aid the enhancement of brand recognition and to draw in more consumers.

Once a startup has attained positive repute for its product or service, consumers will associate its trademark with what the business is offering to its customers. Trademarks are significantly beneficial when a business wants to diversify its products or services, get into franchising through licensing, attain more value by putting itself up for sale.

To ensure that start-ups do not need to get into the hassle of changing names at a later stage, they must conduct a thorough trademark search to determine whether the trade name, trademark or tag-line is currently being used. Not doing this can lead to the start-up losing all the brand advantage it has built till then.

For a brand to gain the value and distinguishability, visibility of the trade mark or brand needs to be built up. This calls for lots of efforts and is achieved by way of marketing including branding, advertising, blogs, posts through various media like social media and other online platforms to name a few.

The value adds that come with a trademark are manifold and some are listed below

Creates brand recognition in public
Builds trust among customers
Creates value in the market
Enhances reputation and goodwill
Distinguishes it from other companies in same business
Helps in marketing and branding
Increases visibility in search engines

What is Copyright?

Copyright grants legal rights to anything you create that expresses or embodies an idea. It gives you exclusive rights to copy, distribute, reproduce, display, and license the work. Copyright consists mainly the following categories of works:

Original literary, dramatic, musical and artistic works.
Cinematograph films.
Sound recordings.

Generally, the relevance of copyright in business is limited to creative and literary works. However, as discussed earlier, copyright can come as a help for safeguarding ideas, business methods, software etc. if safeguarding them under Patent law becomes difficult and cumbersome.

What do you mean by Trade Secrets?

Trade secrets include any confidential business information related to manufacturing or industrial or commercial secrets, formula, practice, process, design, method, etc. which provide an enterprise a competitive edge over others.

It may be noted that there are no Intellectual Property statutes under which trade secrets can be registered. Either, trade secrets can be registered under patent laws or copyright laws if it is possible by complying with the required criteria. Trade secret infringements are questioned in courts under common civil and criminal laws as applicable. If the trade secret is not published or available in public domain, generally companies sign a NDA (Non-Disclosure Agreement) with stakeholders like prospective investors, customers, vendors, banks, employees and such other stakeholders to safeguard it to help the organisation in litigation if that becomes inevitable.