Protecting Your Company’s Most Valuable AssetsJuly 23, 2026

When business owners hear the term “intellectual property,” many think first of groundbreaking inventions, complex scientific discoveries, or technology companies with extensive patent portfolios. Many business owners think they don’t have intellectual property.” That assumption can be both incorrect and costly.

Intellectual property is not limited to patented technology. It includes the name under which a company does business, the brands customers recognize, the content on its website, proprietary software and data, product designs, confidential methods, formulas, customer information, technical know-how, and the innovations created by founders, employees, and contractors. These assets may be difficult to see on a balance sheet, but often in today’s economy, these assets form the foundation of your commercial value.

Management consulting firm Ocean Tomo has conducted a long-running study evaluating the components of the market value of companies in the S&P 500. Its 2025 update again demonstrates that, over the past several decades, intangible assets—including patents, trademarks, copyrights, trade secrets, data, software, branding, and other forms of intellectual capital—have become the dominant source of corporate value.

The 2025 update reflects 50 years of data from the U.S. market and 20 years of data from international markets. The growth in the value of intangible assets is illustrated in the graph below, which is reproduced from the study.

In 1975, during the era of brick-and-mortar businesses, tangible assets—including property, manufacturing facilities, equipment, inventory, and other physical capital—represented approximately 83% of the market value of S&P 500 companies. Intangible assets accounted for only 17%.

By the end of 2025, that relationship had been almost completely reversed. Intangible assets represented approximately 92% of S&P 500 market capitalization, while tangible assets accounted for only 8%. Ocean Tomo describes this shift as an “economic inversion.” More fundamentally, it represents a transformation in how businesses create and preserve value. Economic worth has increasingly migrated from physical property to intellectual capital.

What Does This Mean for Your Business?

A substantial portion of your company’s value is intangible. Just as you would lock the doors to your manufacturing facility, office, or storefront, you should take deliberate steps to protect the intellectual property that supports your company’s competitive position.

An intellectual property strategy should not be treated as an isolated legal project. It should be an integral part of your overall business plan. The following are ten considerations every business should evaluate when developing an effective intellectual property strategy.

1. Understand the Existing Intellectual Property Landscape

Before entering a market, determine whether existing patents, trademarks, or other intellectual property rights could create obstacles.

Are competitors already using similar brands? Are there patents that may cover your proposed product, manufacturing process, or service? Are there opportunities to design around existing rights?

Intellectual property counsel can conduct appropriate searches and help you understand the competitive landscape, evaluate potential risks, and develop a strategy for navigating existing rights. Addressing these questions early is generally far less expensive than responding to an infringement allegation after a product has launched.

2. Clear and Register Your Trademark Early

Business owners and marketing firms often develop a clever product name, logo or company name, invest in branding, and become emotionally attached to it before determining whether the name is legally available.

That approach can lead to an expensive rebranding effort, a trademark dispute, or both.

Before committing significant resources to a name, work with intellectual property counsel to conduct an appropriate trademark clearance search. Once the mark has been cleared, consider filing an application to register it as early as practicable.

The cost of an early search and application is modest compared with the cost of abandoning a brand after packaging, websites, advertising, and customer recognition have already been developed.

3. Budget for Intellectual Property and Related Legal Protections

Intellectual property protection requires planning and an appropriate budget. Depending on the business, that budget may include patent and trademark preparation and prosecution, copyright registrations, trade secret protections, and ongoing monitoring and enforcement.

Businesses should also budget for the agreements, policies, and procedures that support intellectual property ownership and confidentiality. These may include:

• Employee and contractor agreements;
• Invention assignment agreements;
• Confidentiality and nondisclosure agreements;
• Material transfer agreements;
• Invention disclosure procedures;
• Cybersecurity and data-protection policies;
• Website and software development agreements;
• Copyright assignments; and
• Restrictive covenants, where permitted and appropriate under applicable law.

A business should build its intellectual property protections from the outset rather than attempting to repair gaps after a dispute arises.

4. Establish Clear Ownership and Plan for an Exit or Acquisition

Intellectual property ownership should be addressed at the beginning of the business relationship, not when a founder leaves, an employee resigns, or an acquisition is underway.

Who will own the company’s inventions, software, branding, content, data, and trade secrets? Who has authority to make final decisions regarding filing, licensing, enforcement, and abandonment? What happens to intellectual property if a founder departs or the company is sold?

Inventors may initially own rights in their inventions unless those rights have been validly assigned. For that reason, appropriate invention assignment agreements should be executed in favor of the company by founders, employees, contractors, and other contributors.

Clear ownership documentation helps ensure that intellectual property remains with the company when individuals leave or retire. It also reduces uncertainty during financing, due diligence, licensing, and acquisition discussions. Business separations are rarely simple, but well-drafted agreements can significantly reduce the risk of later disputes.

5. Use Nondisclosure Agreements and Material Transfer Agreements

Nondisclosure agreements and material transfer agreements can help protect confidential information and proprietary materials when a company works with potential business partners, manufacturers, researchers, consultants, investors, or prospective employees.

Having appropriate agreements available is only the first step. The business must also use them consistently and before confidential information or proprietary materials are disclosed.

For example, a potential manufacturer or development partner that will receive product samples, biological materials, prototypes, formulas, or other proprietary materials may need to sign both a material transfer agreement and a nondisclosure agreement. These agreements should address permitted uses, ownership of improvements and test results, confidentiality, return or destruction of materials, and restrictions on reverse engineering or further distribution.

Confidentiality protections are most effective when they are implemented before disclosure—not after valuable information has already been shared.

6. Monitor Competitors’ Intellectual Property Filings

An initial review of the intellectual property landscape is important, but it should not be treated as a one-time exercise.

Competitors’ patent and trademark filings can provide insight into their product development plans, research priorities, branding strategies, and potential areas of expansion. Periodic monitoring may allow your company to identify risks earlier, respond to potentially conflicting trademark applications, evaluate newly issued patents, or identify opportunities for design-arounds, licensing, or collaboration.

Quarterly or other periodic patent and trademark monitoring reports are relatively easy to obtain. Intellectual property counsel can help evaluate the significance of new filings and determine whether action is warranted.

7. Avoid Rushed, Inadequate Early Patent Filings

A provisional patent application can be filed relatively inexpensively and may establish an early priority date. This can make a quick filing seem attractive, particularly to startups operating under tight budgets and short timelines.

However, a provisional application is valuable only to the extent that it adequately describes and supports the invention. A provisional application should contain sufficient technical detail to satisfy the applicable disclosure requirements and support the claims that may later be pursued.

A thin or incomplete provisional application may create a false sense of security. If important subject matter is added only in a later application, the company may not be entitled to rely on the earlier filing date for that added material.

A well-developed provisional application should describe the invention, alternatives, variations, examples, supporting data, and reasonably foreseeable implementations. Investing in a comprehensive disclosure at the outset can provide substantially greater strategic value than filing a minimal application merely to obtain a filing receipt.

8. Preserve Strategic Flexibility in Foundational Patent Families

A company’s earliest patent family may become one of its most important assets. It may provide the earliest priority date for core technology and serve as the foundation for later continuation applications directed to different aspects of the invention.

Maintaining a pending application in a strategically important patent family can provide flexibility to pursue claims covering new commercial embodiments, additional uses, competitor design-arounds, or developments that were adequately disclosed in the original application.

Continuation practice can become expensive, and recent fee changes have increased the cost of maintaining lengthy continuation chains. Nevertheless, the value of preserving claim flexibility may justify the expense for commercially important technology.

Continuation decisions should be made strategically and with an understanding of the company’s products, competitive environment, licensing goals, and enforcement needs. A decision made solely to reduce expenses today may limit the company’s ability to protect valuable developments tomorrow.

9. File Foreign Patent Applications Judiciously

Many startups initially express a desire to pursue worldwide patent protection for their foundational technology. In practice, broad international filing programs can become extremely expensive.

Foreign patent costs may include filing fees, translation expenses, local counsel fees, examination fees, validation costs, annuities, and ongoing prosecution expenses. Costs can be particularly significant in Europe and in jurisdictions requiring extensive translations or annual fees while an application remains pending.

Foreign filing decisions should be tied to the company’s business strategy. Consider where the product will be manufactured, used, imported, or sold. Identify the company’s most important markets, likely licensing territories, major competitors, manufacturing centers, and potential enforcement venues.

A large international portfolio is not necessarily a strong portfolio. A smaller, carefully selected group of foreign filings may provide greater commercial value than a broad portfolio that the company cannot afford to maintain.

I have seen many early-stage companies begin with an expansive international filing strategy, only to abandon applications as costs increase and prosecution extends over many years. Those abandoned filings may represent substantial resources that could have been invested more effectively elsewhere.

10. Develop a Relationship With Trusted Intellectual Property Counsel

Intellectual property counsel can provide the greatest value when counsel understands the company’s business as a whole—not merely a series of isolated transactions.

Bringing counsel into the process only when a patent application must be filed or an agreement must be signed may limit the quality and strategic value of the advice the company receives. Counsel who understands the company’s products, commercial objectives, competitors, research plans, financing strategy, and potential exit opportunities is better positioned to identify risks and recommend meaningful protections.

Effective intellectual property counsel should function as a trusted business partner rather than a reluctant expense. The goal is not simply to accumulate patents or trademarks. The goal is to protect the assets that support the company’s business model and create lasting enterprise value.

Make Intellectual Property Part of the Business Plan from the Start

The best time to develop an intellectual property strategy is before a problem arises. Identify what creates value, confirm who owns it, determine how it should be protected, and allocate the resources necessary to preserve it.

The most successful companies don’t think about intellectual property only when they need to file a patent or register a trademark. They view it as an essential business asset that requires ongoing attention and strategic guidance. By partnering with experienced intellectual property counsel who understands your business, you can build a comprehensive IP strategy that protects your innovations, strengthens your competitive position, and creates lasting value for years to come.

Heidi Sease Nebel is Chair of the Biotechnology & Chemical Practice Group at McKee, Voorhees & Sease, PLC. For additional information please visit www.ipmvs.com or contact Heidi directly via email at heidi.nebel@ipmvs.com.