Why IP Protection Starts with Strong Contract Clauses — Not Just Patents

When we talk about intellectual property (IP), it’s easy to think about trademarks, patents, and copyright registrations. But for startups, IP protection starts much earlier—in your contracts.

According to a recent article by the Swiss Federal Institute of Intellectual Property (IPI) “IP-Schutz beginnt bereits bei Klauseln in Verträgen”, the foundation for safeguarding your ideas is laid not in the patent office, but in the clauses of your agreements with employees, co-founders, freelancers, and external partners.

And this is something every startup founder should pay close attention to—because failing to get this right early on can have serious consequences later, especially when facing due diligence during an investment round.

Why Contracts Matter for IP

Startups are built on ideas—products, software, designs, technologies, and branding that differentiate them from the competition. But who owns those ideas? That’s where many young companies run into trouble.

Many founders assume that anything created for the company, especially by employees or freelancers, automatically belongs to the startup. However, this is not always the case under Swiss law. Without clear contractual agreements, creators (even if paid for their work) might retain certain rights to their work.

And when investors dig into the company during due diligence, unclear IP ownership can raise red flags—or even halt an investment entirely.

What Needs to Be in Your Contracts

The IPI emphasizes that the following areas are particularly crucial for startups:

1. Employment and Freelancer Agreements

Contracts should explicitly state that any IP created during the course of employment or under a freelance arrangement will be fully transferred to the company. This includes:

• Software code
• Design assets
• Inventions and product developments
• Marketing materials

Don’t assume the default law covers you. Make sure this is spelled out in writing.

2. Co-Founder Agreements

One of the most common oversights in early-stage startups is neglecting to define who owns the IP—especially if multiple founders contribute to the core product. A solid co-founder agreement should:

• Assign IP to the company (not individuals)
• Define what happens if a founder leaves
• Cover confidentiality and non-compete clauses

This isn’t just legal housekeeping—it’s protection for your startup’s future.

3. NDAs and Collaboration Agreements

If you’re working with external agencies, developers, or consultants, make sure non-disclosure agreements (NDAs) and collaboration contracts are in place. These agreements should:

• Clearly define ownership of any jointly developed IP
• Set terms for how information and materials can be used
• Prevent misuse or sharing of sensitive startup assets

🔍 Why This Matters for Fundraising

One of the first things investors look for is whether a startup truly owns its technology and brand. If ownership is unclear—or worse, disputed—it creates a serious risk. Investors want to see:

• IP assignment agreements in place
• A cap table that reflects clear ownership structures
• A clean legal history with no unresolved claims

Without proper contracts, your startup’s most valuable assets could be compromised—and that can stall or kill a funding round.

 Take Action Early

The good news? You can avoid these risks with just a few proactive steps:

• Work with a lawyer experienced in startup law
• Use solid contract templates that include IP assignment clauses
• Regularly review agreements as your team or scope grows

As the IPI article states, “IP protection begins with the first contract.” Waiting until later to formalize things can cost far more in legal fees—or lost opportunities—down the road.

Final Thoughts

If you’re a startup founder, think of IP not just as patents or trademarks, but as everything your company is building. And the best way to protect that value is by being intentional and thorough with your contracts—right from the beginning.

Need support navigating these topics? The Swiss Startup Association regularly offers Founders Academy sessions focused on IP, legal structure, and investment readiness. Check out our upcoming events or get in touch with our network of expert partners.

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📖 Original article source:
“IP-Schutz beginnt bereits bei Klauseln in Verträgen” – Swiss Federal Institute of Intellectual Property (IGE/IPI)
🔗 Read it here (in German)