Certain contracts are a must-have for any business but an all-important Contract that you need to have if you run a tech business or a tech-enabled business is the INTELLECTUAL PROPERTY ASSIGNMENT AGREEMENT ( IPAA).

Intellectual property is unarguably the most important or most valuable asset in a tech or tech-driven business.

Intellectual property are products of the mind that is, works, work products or inventions, software, artistic, literary images, words, symbols names etc which are the results of creativity and which can be protected through Copyright, Trademark, Patents, industrial designs or even via trade secret protection.

An intellectual property Assignment Agreement is a written contract that transfers the ownership right in anything ( work product) created by an employee, developer, consultant, etc. to the company.

This makes the company rather than the employee or the creator of that invention or work product the actual owner of the intellectual property.

There are basically two types of Intellectual Property Assignment Agreement

(1) Technology Assignment Agreement:

 This is a written contract between a Company and a developer (not being an employee) in which the developer transfers the intellectual property rights in a software or work product to the company in exchange for cash or equity in the company.

This is usually before the incorporation of the company.

(2) Invention Agreement:

 This is a written contract between the company and the employees of the company whereby the employees transfer to the company in advance all the inventions, work products, designs etc. relating to the business of the company.

This way, the intellectual property rights in the inventions are owned by the company and not the employee.

Please understand that in the absence of any agreement to the contrary, Intellectual property rights belong to the creator of the work.

this makes it necessary for there to be an actual transfer of such rights to the company.

this helps in protecting the company against unhealthy rivalry and competition in the future.

Investors want to know that the company actually owns the intellectual property rights in the software, work products, inventions etc. created by either the developer or employee before they decide to fund your business.

So if you run a tech start-up or you are thinking of starting or investing in a

tech business or tech-driven business among other things, this should be one very key area you should be concerned about.

There you go!

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