Session 7: Legal Matters and Venture Lab #1

Tuesday, January 28, 2020

Summary: This session will focus on legal matters. As time allows, we will also examine the importance of intellectual property (IP) and the impact of government regulation. Whereas old economy businesses built value in the form of factories and equipment, new economy businesses create the lion's share of their value in intangibles: patents, copyrights, trade secrets and trademarks.  An effective entrepreneur knows how to establish these key assets, and how to use them with investors, partners and competitors.  IP issues vary across industries and product categories.  For example, protecting IP with patents is less critical for web software ventures than it is for biotechnology ventures.

Government regulation is also an important factor that should be understood by entrepreneurs. In some cases a change in regulations can raise a company’s costs. Like IP, some industries have greater regulatory requirements than others.  For example, food, drugs, and most new medical technologies require special approvals from the U.S. Food and Drug Administration (FDA).  The bad news is that the FDA approval process lengthens the product development cycle.  The good news is that it insures the safety of customers, and can make it harder for a competitor to catch up with an entrepreneur who has created a new market.

The Venture Lab component of this session is a required, in-class meeting of your OAP team. For this particular Venture Lab, we will meet a current masters student who is raising seed money for a start-up opportunity in mental health.

Term Project (Policy on Term Project Assignments)

First Positioning Statement (PS1). The Global Marketing and Sales class session will help you and your team get started in writing your positioning statement. Fill in Geoff Moore's two-sentence positioning template for your OAP product or service concept. The template is:

Sentence #1

For (target customer)

who (statement of the need or opportunity),
the (product/service name) is a (product/service category)

that (statement of benefit).

Sentence #2

Unlike (primary competitive alternative),

our product (statement of primary differentiation).

Create two slides. One slide should simply list the name of your project team with all the team members and their majors. The second slide should have a succinct draft of your positioning statement above.  Submit on canvas by noon the day of this session. For extra credit, create an additional slide to share how your potential venture will make meaning and not just money.

Quote of the day: “Everything should be made as simple as possible, but not simpler.” Albert Einstein

Guest: Dan Dorosin

Study Questions (Policy on Study Questions.)
  • What are some legal matters that are important to new enterprises?
  • What is the role of a law firm in assisting startups?
Required Readings (Policy on Required Readings.)
  • Technology Ventures (Byers, Dorf, and Nelson): Chapters 10 and 11 (Textbook's Section Highlights only); focus on Section 10.1, and recommended sections in Chapter 11 for this session.
Recommended Readings/Viewings

● Protecting IP - Martin Nichols

● What Do Startups Need to Know about Patent Law - Jeff Schox (teaches MS&E 278 every year)