Are you a game developer busily creating new IP?
Looking after your IP is a key part of being a creative craftsman. It’s not easy to keep track of all the little details when you start up as a small studio and often it can seem a daunting task to be as diligent as perhaps you know you should be when under huge time and financial pressures. Are you fully aware of the possible financial implications if your IP isn’t fully in order? Investors, publishers and lenders will always seek complete reassurance that all IP is safe, secure and properly managed before committing to any deal.
It’s all well and good developing a great IP that’ll seal your success as a games company, but it could all go badly wrong if you don’t keep things organised behind the scenes. We call this keeping things organised “IP housekeeping”.
What’s the risk?
Even if you discount the fact that it’s best practice to efficiently and diligently manage your IP – the real value of strong IP housekeeping goes far beyond ticking boxes in that way. Read these scenarios that demonstrate the impact to the financial value of your IP when you don’t pay attention to the important details.Take Specimen Games for example. These possible scenarios illustrate just how valuable good IP management can be to your business.
Specimen Games and the investor
IP ownership issues
Specimen Games is in discussion with a third party investor who is keen to support the company in the development of the Woodland Warriors title. Now at the due diligence stage issues have been identified with the ownership of all IP assets. At the time of company formation three founders worked on the IP but soon after one founding director left the company. The potential investor has asked to be presented with the paperwork pertaining to the director’s exit along with the assignment of IP rights.
Specimen Games has been unable to produce satisfactory paperwork relating to this issue. As a result, the potential investment is lost and the deal falls through.
Specimen Games: the acquisition
The acquirer asked for written warranties from the founders accepting full liability for any breach of licence terms during the early stages of the company when the founders were using middleware licences originally purchased by their former employers. The warranties require full details of the licences. The founders are faced with tough decisions regarding entering into warranties that they can’t substantiate.
Unfortunately, their uncertainty unsettles the acquirer and the deal falls through.
Specimen Games and the would-be publisher deal
Specimen Games has successfully progressed the deal process for their Woodland Warriors game with a well-known and respected publisher in the mobile market from initial conversation to the due diligence stage. The publisher is keen to progress the relationship to full commercial agreement but must undertake due diligence checks. It is at this stage that issues with the trademarking of several digital assets are identified. Whilst not insurmountable to securing the publishing deal these issues have highlighted management weaknesses in the company. As a result the publisher has reduced the level of a financial advance to the company by 20% until this issue is rectified..
Working capital raised by Specimen Games is now 80% of what was originally on the table, purely down to the mismanagement of trademarks.
How the IP Manifest can help
There are many potential pitfalls regarding games IP. Third party licences, employment contracts, trademarks, copyright to name just a few. But what if you could detail the complexities of your IP in a simple but comprehensive way that didn’t take you away from the core business of games development for any length of time. Good IP housekeeping won’t impact negatively on your company’s growth. Can you imagine extending your confidence as a creative craftsperson so that you intuitively know that your IP housekeeping is in order?
The IP Manifest toolset has been carefully designed to help you do just that – it’s a basic but very efficient way of helping you map and monitor your own company’s IP landscape in a way that helps clear the path towards securing investment. What’s more, it’s completely FREE thanks to funding from the Intellectual Property Office. We’ve consulted with experts from across the games development and finance communities to ensure the IP Manifest serves everybody’s purpose well.
You can begin to use these business-changing tools today. Simply register your details to freely access the tools.
Housekeeping made easy
Using the IPM Self-Audit Tools, you can quickly and efficiently identify areas to focus on when planning your IP strategy for your business. You start by completing a short multiple-choice online assessment. You'll receive a report with a personalised detailed overview of your currentl IP management status and what you need to focus on as a growing business to improve your chance of securing investment with a solid strategy in place. The report includes a checklist that you can use to create your own IP Manifest.