Turning an idea into a business is one of the most exciting moves you can make, but it also brings legal responsibilities that many founders overlook. Whether you are a student launching a product, a community innovator testing a concept or a faculty researcher spinning out a company from university research, understanding the legal terrain early is essential to protecting your idea and building a successful venture.
At ASU’s Edson Entrepreneurship + Innovation Institute (Edson E+I), we support entrepreneurs of all backgrounds and stages. If your innovation was developed using ASU resources or funding, Skysong Innovations is your essential partner for protecting and licensing university-owned intellectual property (IP). For those working with their own IP, knowing how to secure legal protections and build strong operational foundations is just as important.
Protecting Intellectual Property (IP)
First, what is your intellectual property? IP is often your most valuable business asset. It includes trademarks, copyrights and patents. Your trademarks cover what makes your brand unique, like your brand name, logo and slogan. Your copyrights cover original works, like writing, designs, code and videos.
Patents can be a little more involved. In the U.S., a patent gives the inventor the right to exclude others from making, using or selling their invention. It does not automatically give you the right to use the invention, especially if other regulations apply, such as FDA approval. Patentable subject matter includes machines, processes, compositions of matter and certain software. Naturally occurring substances are not typically patentable unless significantly modified.
Here are 7 legal considerations you should understand as you launch your business and protect your IP.
1. Your Legal Entity
Once you have an idea and are ready to launch, consider the type of legal entity that makes the most sense for your business. The legal structure you choose affects everything from how you pay taxes to how much personal liability you carry.
Many businesses start as a sole proprietorship. These organizations are easy to form but this structure can expose your personal assets to business liabilities. Another popular structure is the partnership. If you are building a business with a co-founder, a partnership offers shared ownership and requires clear agreements to avoid disputes.
You can also launch as a Limited Liability Company (LLC). LLCs are popular because they protect your personal assets and offer flexibility. Finally, you can look at creating a C-Corporation, which are often chosen by startups planning to scale or raise capital.
Tip: Edson E+I’s Venture Devils program can connect you with mentors and legal resources to choose and register the right structure for your goals.
2. The Patent Process
For ASU Researchers and Faculty: Work with Skysong Innovations
If your innovation was developed with university support, ASU retains certain IP rights. In these cases, faculty, staff and students must disclose their invention to Skysong Innovations, the university’s exclusive technology transfer and IP management office.
Skysong has a five-step commercialization process:
- Invention Disclosure – Complete an online form (ASURITE login required) before public disclosure.
- Technology Evaluation – Skysong evaluates the market and IP potential.
- Marketing – They connect with potential licensees.
- IP Protection – Skysong pays the legal fees and manages patent filings.
- Licensing – If a licensee is found, Skysong negotiates and oversees the agreement.
Skysong generally does not file foreign patents unless there is a viable market or licensee. Faculty members are not responsible for patent costs unless otherwise negotiated.
The General Patent ProcessWhether filing with Skysong or independently, here are key terms and processes to know:
- Provisional Patent Application – This paten application is a temporary, low-cost filing to establish a priority date and it expires after one year.
- Utility Patent (Non-Provisional) – This full application is reviewed by the United States Patent and Trademark Office (USPTO) and can grant patent rights for up to 20 years, if approved.
- Continuation-in-Part (CIP) – The CIP adds new content to a previously filed application.
- Divisional Application – Businesses file this application to protect additional inventions from an original application.
Office Actions:
- Non-Final Office Action – The USPTO outlines issues or rejections with your patent application. You can revise or argue your claims.
- Final Office Action – If the reply is unconvincing, the USPTO may reaffirm the rejection or issue new grounds. You may file a continuation or appeal.
- Notice of Allowance – The USPTO intends to grant the patent. Fees must be paid within three months with no extensions allowed.
Who Pays for Patenting?
For ASU IP, Skysong covers the cost and licensees later reimburse these expenses. For personal ventures, you are responsible for legal and filing costs. These can range from $10,000 to $25,000 for U.S. patents and more for international protection.
3. Copyrights, Trademarks and Ownership
Every business, whether tech-heavy or not, creates content worth protecting.
Copyrights
A copyright applies to original works such as code and software, books, videos, visual design, your website and your marketing materials.
Copyright applies automatically once the work is fixed in a tangible medium. To enforce rights more easily, you can register with the U.S. Copyright Office. Skysong may register university-developed works, such as software and GUIs.
Trademarks
Trademarks protect your brand identity in commerce. You can begin using a trademark once it appears in business activity. Federal registration through the USPTO provides nationwide protection and legal presumption of ownership.
If you are developing your own company, you are responsible for registering trademarks. Skysong does not manage trademark filings.
4. Contracts: Tools for Clarity and Protection
Contracts are essential to defining expectations, relationships, and ownership. There are four key contracts for entrepreneurs:
- Founder Agreements – Define ownership, responsibilities and equity vesting
- Independent Contractor Agreements – Outline deliverables, payment and IP ownership
- Non-Disclosure Agreements (NDAs) – Protect your ideas in early discussions
- Terms of Service and Privacy Policies – Required for most websites and apps that collect user data
For startups built around ASU-owned IP, Skysong will draft licensing and assignment agreements. Independent ventures should use trusted templates or consult a legal professional.
Even simple agreements help prevent misalignment and future disputes.
5. Employment and Internships
As you bring others into your business, clarity is key. Decide if you want to bring on employees or contractors. Misclassification can result in tax and labor law penalties. If you decide to hire an intern, remember that unpaid internships must comply with Department of Labor criteria.
For your first few hires, you might consider providing equity as part of their compensation. Use clear agreements to offer stock or options, and track ownership in a cap table.
If your company is based on ASU IP, offering equity to ASU-affiliated inventors must comply with university policy and Arizona law.
6. Raising Capital: Legal Considerations
When raising funds from others, you are subject to federal and state securities laws. Here are a few terms you should know.
- Convertible Notes and SAFE Agreements – Postpone valuation and convert to equity later
- Equity Rounds – Involve pricing shares and setting terms
- Form D Filing – Often required for private placements
Edson E+I supports founders with pitch preparation, investor networking, and SBIR/STTR grant navigation. If using ASU-owned IP, equity arrangements must be reviewed and approved by Skysong.
7. Licensing, Revenue, and Ownership
If you are using ASU-owned IP you may share in licensing revenue under the Arizona Board of Regents IP policy, but you may not receive personal equity from a license issued to ASU unless it is pre-approved. Skysong manages revenue distribution and licensing compliance.
If you own your IP outright you control all licensing and revenue models.You can sell, sublicense, or retain all rights as you grow.
Regardless of ownership, track agreements, revenue streams and equity shares early.
Programs That Support Your Legal Journey
Edson E+I supports all entrepreneurs with access to resources, funding and mentorship. Here are a few of the programs to help you get the information you need.
For Students and Community Innovators:
- Venture Devils – Coaching, pitch practice, seed funding and community
- Learning Modules – Legal, finance and product development topics
- Startup Resources – Workspaces, events and collaboration tools
For Faculty and ASU Researchers:
Through the Innovation2Market (I2M) team at Edson E+I, faculty receive specialized commercialization support. Programs include:
- Inventors Series Mentoring Cohort – Prepares ASU inventors for grants, seed funding, and investor engagement.
- Lab to Launch – Provides showcase opportunities and seed funding to help move early-stage technologies to validated startup concepts.
- SBIR/STTR Support – Provides support assistance with SBIR/STTR applications.
- Partnerships with ASU Health, InvestU, HEALab, the Fulton Schools of Engineering, W.P. Carey, and Skysong Innovations.
These programs help bridge the gap between research and real-world application.
Legal Foundations Empower Big Ideas
Your startup’s legal framework should not be an afterthought. It is the foundation that lets your ideas grow, your team thrive and your innovation reach the world.
At Edson E+I, and especially through the Innovation2Market team, we help turn ideas into investable, impactful ventures. With partners like Skysong Innovations, and support from across ASU, you never have to go it alone.
Protect wisely. Build boldly. Launch with purpose.
Learn more: entrepreneurship.asu.edu
Disclose ASU inventions: skysonginnovations.com
Explore IP support: ASU Library Patent & Trademark Resource Center
