My idea: is it a business? pptx

A DTI SERVICE
My idea: is it a business?
UK Intellectual Property Ofce is an operating name of the Patent Ofce
All information contained in this document was correct at the time of going to print, and is available in alternative formats
on request. For further information please visit our website at:- www.ipo.gov.uk or contact us on:- 08459 500 505
1
This booklet gives basic guidance on how to legally protect your idea,
and develop it into a reality. It aims to give you an overview of the issues
you need to be aware of in turning your idea into a successful business.
If you need more detailed advice from experts, the guide directs you
to appropriate professional organisations. You’ll also nd a couple of
examples of successful ideas which have been developed into businesses.
Introduction
2
Research 3
What is intellectual property (IP) 3
Choosing a business strategy 5
Working with other people and organisations 6
Condentiality 6
Keeping hold of your idea (enforcement) 7
Making sure your idea is original 8
Develop your idea 9
Assessing potential markets 10
Identifying your competitors 11
Planning your project 12
Funding your business 13
Attracting partners 14
Govenment support 15
Checklist 16
Case study (FireAngel®) 17
Case study (Solio) 18

Contents
3
Researching your idea is vital. Be realistic about the
following six questions.
• Does your idea work?
• Is there a market?
• What will it cost to produce?
• What will people pay for it?
• Canitreallymakeaprot?
• Can you market it, and do you have the energy
and resources to do so (or can you get them)?
What is intellectual property (IP)?

• Patents – If you’ve created a new invention, it could
be a good idea to apply for a patent. This gives you
the authority to control how the invention is made,
used or sold.
• Copyright – This can be an important source of
income for your business as you may be able to
charge every time someone plays your jingle on the
radio, uses your software, transfers your manual
to the internet, makes copies of your song lyrics or
reprints your magazine article. You can also use
copyright to stop competitors copying your labels and
literature.
• Designs – These are important assets as they can
be a valuable selling point and part of your business
branding, separating you from your competitors.
• Trademarks – These can be one of the most
powerful marketing tools you have, as they help

customers recognise your company. Registering
a trademark allows you to protect the goods and
services which carry it, and gives you an IP asset
to stop other people or organisations from copying
them.
• Know-how – You should keep secret any information
or knowledge you have that is not obvious from the
products or processes you are going to sell. This
will help you keep ahead of your competitors and
improve any IP you want to license.

Research
If you’ve created a new
invention, it could be a good
idea to apply for a patent.
This gives you the authority
to control how the invention is
made, used or sold.
4
Getting an existing manufacturer to make your product or
provide your service can allow you to concentrate on other
things like promoting and selling it.
Joint ventures allow you to bring together the resources of
two or more different business to develop a shared project.
Usually, one business provides the idea and the other
provides expertise or funding. ‘Setting a Vision for Growth’
(www.businesslink.gov.uk) by Business Link provides more
information. Most joint venture agreements should include
a licence agreement to set out how to transfer technology.
In a collaboration, you team up with a business or

university. This allows you to share the costs and the
work, but it may also mean you’ll have to split the prots.
For more information, read the Business Link guide ‘Joint
Ventures and Partnering’ (www.businesslink.gov.uk) on
how to work with UK universities and colleges, or speak to
your local Business Link adviser (www.busineslink.gov.uk/
bdotg/action.directory?r.s=h). There are also some grants
available to encourage businesses and universities to work
together.
Spin-out companies
A spin-out company is an independent company created
to make best use of IP rights which have been licensed.
These companies are often used in universities, where
the original researchers need to be involved for the spin-
out to be successful in the future. Because the business
relationship is at ‘arm’s length’, it allows the spin-out
company to focus on a single idea and secure funding or
government grants
(www.patent.gov.uk/about/notices/2002/manip/sec04.pdf).
Choosing a business strategy
You may choose to start some sort of business to make best use of your idea, rather than license or sell it.
Startingyourownbusinessislikelytobeexpensive,butallprotsandsuccesswillbelongtoyou.Youmaybe
able to attract funding, but to do this you will need a business plan. The ‘Starting Up’ section of the Business
Link website (www.businesslink.gov.uk, or www.bgateway.com in Scotland) provides guidance for those people
who are considering setting up their own business.
It is also worth remembering that even if you do not start your own business, you should still be prepared to do
most of the work to show why your idea can make a good business.
Getting an existing manufacturer to make your product
or provide your service can allow you to concentrate on
other things like promoting and selling it.

5
Selling your rights
Selling some or all of your rights will give you a one-off
payment but not a long-term income. Once you have sold
your ownership, the new owner can stop you using the IP
unless you agree a licence with them that allows you to
continue using it.
Licensing
Because you hold the IP rights, a licence will give you an
income without you having to put time and resources into
producing the product yourself. A licence arrangement
can pay you either a xed amount or royalty payments
whenever your idea is used. Often, the licensee (the
company you license your rights to) will have better
knowledge of and access to markets, which will more
effectively make best use of the IP.
You can license the rights to one company or many, and
this will affect how much money you can make. But
remember, doing the work to show that your business
idea works is highly important. Licences can be limited in
geographically or in time or how the rights are licensed. A
clear written agreement between you and the licensee is
vital to avoid you having disputes in the future.
The Licensing Executives Society Britain and Ireland
(www.les-bi.org) is the society for professionals who are
interested in licensing IP rights and transferring technology.
The Institute of International Licensing Practitioners (www.
iilp.net) can help you with licensing in the UK and abroad,
and run a service to nd you an appropriate licensing
consultant.

Copyright collective licences
Many copyright owners nd it difcult to manage their
rights on their own, and so have formed collective
management organisations to represent them and manage
their rights for them. There are many collecting societies
available who will manage and license the copyright on
your behalf (see www.intellectual-property.gov.uk/faq/
copyright/copyowners.htm).
There are a range of business strategies for artists and
other copyright owners to increase prot as much as
possible. You could aim your product or service at the
mass market or only make a limited edition. The copyright
owners’ organisations may be able to provide more
advice (www.intellectual-property.gov.uk/faq/copyright/
copyowners.htm).

Public-lending rights (PLR)
The PLR scheme gives payments from government funds
to authors, to allow public libraries in the United Kingdom
to lend their books for free (www.plr.uk.com).

Managing your IP rights
Just like physical property, it is up to you how you manage your IP rights. Selling or licensing your rights may
appeal to you, but no-one wants to buy a business that won’t make money. Your research on the market, costs
and competitors will be vital to show someone why they should buy or license your idea.
Selling some or all of your rights will give you a
one-off payment but not a long-term income.
6
Building a team is important, and you’ll almost denitely
need to nd people to help you along the way, because

they bring skills you don’t have. It’s important to work out
what help you need, how much it will cost and what you
can pay. A good team around you will often make the
difference between a business succeeding and failing.
Being a small inventor can be a lonely business, and
making a business from your ideas can be frustrating
and sometimes painfully slow. Because of this, it can be
useful to contact other inventors to share ideas, advice and
opinions. There are a number of online forums that allow
users to swap ideas and information, such as IPR Talk
(www.iprtalk.co.uk), Make Sparks Fly (www.internetprnews.
com/colloquix/1/index) or the ideas21 network
(www.ideas21.co.uk).
You can get more advice on all areas of inventing at the
Institute of Patentees and Inventors (www.invent.org.uk).
In Scotland, ICASS (www.icass.co.uk) provides specialist
advice and support for Scotland’s inventors.
Invention promoters are rms who offer help to inventors.
Some people use their services to assess, develop
and market ideas. Invention promoters can be very
expensive. If you are interested in working with one, we
recommend that you do some research before entering
into a contract. This may help you to avoid costly mistakes.
For information on dealing with these companies, please
read our guidance ‘Step-by-Step Guide to using Invention
Promoters’ (www.patent.gov.uk/patent/howtoapply/
ipromoters) or contact the Institute of International
licensing Practitioners (www.iilp.net).
Technology brokers
There are lots of services available on the internet that

help bring inventors and business people together. The
following website addresses are links to some not-for-
prot brokering services. We do not support any of the
individuals or companies using these services.
Globalwatchonline.com
Wales4innovation.com
Working with other people and organisations
Condentiality
Itishighlyimportantthatyouconsidercondentialitybeforeyouspeaktoanyone.Ifyoudotellpeopleabout
your idea, you may not then be able to patent your invention at a later time. Because of this, sharing new ideas
forabusinessneedsalotoftrust,andcondentialdisclosureagreementscanhelp(seewww.patent.gov.uk/
patent/howtoapply/cda).
Franchising
If you want your business to grow quickly but you don’t
have the cash to make this happen, franchising might
be one way to grow. However, you will have to share the
prots and lose some control over how your idea is sold.
The British Franchise Association may be able to help
(www.british-franchise.org).

Building a team is important, and you’ll almost denitely need to nd
people to help you along the way, because they bring skills you don’t
have.
7
Why enforce IP rights?
The main aim of protecting IP rights is to allow the owner
to benet from their inventions. As a result, enforcing IP
rights is vital to:
• make sure IP rights continue to be legally valid;
• prevent other organisations from damaging the IP,

including affecting your goodwill or reputation; and
• help you get compensation for any damage (for
example, loss of prot).
Who will enforce my rights?
It is up to you to identify whether someone has copied
your IP and decide what measures you should then take.
In most cases, you can begin civil proceedings, but if
someone has illegally copied your product or service, you
may be able to begin criminal proceedings.
For more information on how to enforce your IP rights, see
our booklet on enforcement.
Before taking action in court, you may want to ask our
Search and Advisory Service for a validity search or their
opinion (see www.patent.gov.uk/patent/sas).
Insurance
You can get insurance to cover legal costs if you need to
take someone to court for damaging your IP. However,
make sure your policy gives you enough cover. Also, the
earlier you take out a policy, the cheaper it is likely to be.
Insurance underwriters may not be prepared to cover the
risk if you delay taking out insurance until your product has
already been affected.

If you feel that insurance would be a good idea, discuss it
with a professional adviser, such as a patent attorney or
solicitor. Remember that if you’re approaching insurers,
you may need to get them to sign a condentiality
agreement to make sure they don’t publicise your
invention.
Getting hold of and keeping IP rights is meaningless if those rights cannot be enforced in the marketplace. So,

you need to consider what you would do at the start if someone copies your idea.
Keeping hold of your idea (enforcement)
It is up to you to identify whether someone has copied your
IP and decide what measures you should then take.
8
The commercial potential of your idea is likely to be limited
if it isn’t original. You should carry out searches to assess
whether there are any patents or other forms of IP that
cover your idea. There may already be rights covering
the invention itself, which means that all or part of your
idea is not original. There may also be patents or other
publications that were in place before your idea, in which
case you will not be able to get patent protection.
Protect your intellectual property
Once you have found out that your idea is original,
you need to consider how you will protect it. IP law is
complicated, and so getting legal or other professional
advice might often be the best way to work out how to
protect your IP rights and benet from them.
The Chartered Institute of Patent Attorneys (www.cipa.org.
uk) or the Institute of Trade Mark Attorneys (www.itma.org.
uk) may be the best people to approach about registering
your IP rights. CIPA runs clinics (www.cipa.org.uk/pag
es/adviceclinics) which give free basic advice to inventors
at the early stages of developing an idea. For copyright,
lawyers or trade associations (or both) may be helpful.
There are also other, more general sources of advice and
help that might be worth exploring.
• Business Link www.businesslink.gov.uk
• Small Business Service www.sbs.gov.uk

• Innovation Relay Centres www.irc.cordis.lu
• Patent Libraries
www.bl.uk/collections/patents/patentsnetork.html
Making sure your idea is original
IfyouaretomakebestuseofyourIPassets,youmustrsttakeafewstepstosetupyourinvention.Remember,
you need to have non-disclosure agreements in place until you have sorted out applications for protecting your
IP.
For more information on carrying out these searches,
read the section on originality in the Inventors’
Handbook by NESTA
(www.nesta.org.uk/howtoapply/inventorshandbook/).
You can search trademarks
(www.patent.gov.uk/tm/dbase)
and designs (www.patent.gov.uk/design/dbase) on
our website. The British Library runs a free service
for searching for patents, and has a wide range of
resources online (www.bl.uk/services/document/patent.
html).

For a full search, you’ll generally need to pay for expert
help. Patent and trademark attorneys specialise in this
area (see the section on legal help for their contact
details) and our Search and Advisory Service provides
commercial searches for patents (www.patent.gov.uk/
patent/sas) and trademarks (www.patent.gov.uk/tm/sas).
Once you have found out that your idea is original, you need to
consider how you will protect it.
9
Also, see the sections on funding and government support.
Getting the right design can be vital to your business’s

success. Building a prototype (a rst version of the
product) or developing a design can improve your chance
of becoming a successful business (see www.mas.dti.gov.
uk).
A working prototype can help you check that the idea
actually works in practice, can expose any problems you
didn’t see beforehand and can help you to decide on how
the product will look. It can also be useful in discussions
with potential partners or investors.
If you want to produce a working prototype of your
invention, you’ll probably need to work with a manufacturer
or a specialised prototyping centre. A university or
incubation centre could also help (see the section on
support networks).
Local libraries have trade directories, which give lists of
manufacturers and service providers. Remember, you
may need to keep your idea condential and so need to
get a condentiality agreement. You may want to get legal
advice before you make an agreement.
Making sure your product is safe
By law, many products have to be tested independently to
make sure they are safe. Using a testing centre approved
by the United Kingdom Accreditation Service (www.
ukas.com) will make sure that the testing is carried out
competently and that the results will be accepted abroad.
Develop your idea
Find a local contacts directory on the Business Link
website (www.businesslink.gov.uk)
or the local enterprise agency in the National Federation
of Enterprise Agencies (www.nfea.com), or try your local

Chamber of Commerce (www.chamberonline.co.uk).
You may also be able to get help from one of the 12
business innovation centres in the UK (www.ebn.be).
Innovation relay centres match businesses which have
similar technology needs or interests (www.irc.cordis.lu).

The following regional administrations may also be able
to help.
• Regional Development Agencies
www.dti.gov.uk/rda/info
• Scottish Enterprise
www.scottish-enterprise.com
• Welsh Assembly
new.wales.gov.uk/topics/businessandeconomy
• Invest Northern Ireland
www.nfea.com

Once you have developed your new idea into a workable product or service, there are a range of resources that
can help you look into the options. These resources can help you assess the commercial potential of your idea,
drawupabusinessplanandndsourcesofpossiblefunding.
For more information on your legal responsibilities and
guidance on safety issues, see the ‘Managing Health,
Safety and Environment’ area of the Business Link website

Building a prototype (a rst version of the product) or developing a
design can improve your chance of becoming a successful business.
10
Ask yourself the following questions.
• Does it meet or create a need in the market?
• Can you identify potential customers?

• Will the product or service outlive passing trends in
the market or make the most of the trend before it dies
away?
• Is the product or service unique, different or better to
those offered by competitors?
• What competition will it face – locally, nationally and
worldwide?
• Is the product safe and does it keep to relevant
regulations? You should get legal advice before you go
ahead.
To answer many of these questions, you may want to carry
out some market research as this could well increase your
chance of success – the Business Link website provides a
guide (www.businesslink.gov.uk).
You could hire a market research agency – you can search
for one on the Research Buyer’s Guide website
(www.rbg.org.uk).

The Chartered Institute of Marketing has a guide to market
research on their website (www.cim.co.uk/cim/ser/html/
cover) and The British Market Research Association has
research techniques on its website
(www.bmra.org.uk/researchers-toolkit/index).
Pricing your service or product
You must set out a pricing strategy for a new product or
service the moment you decide to take an idea forward, as
it will help you nd out how much you can afford to invest
in the project.
You can nd a full guide to pricing your product or service
on the sales and marketing section of the Business Link

website (www.businesslink.gov.uk). Make sure you
really know what your costs are for making the product or
running the business.
Selling
A thorough sales strategy is vital if your product or service
is to be successful. It should focus on:
• ways of selling that can be stopped
or changed if necessary; and
• how much it costs for each sale.
Today there are many outlets through which you can sell
your goods or services – for example, websites, mail order,
direct mail and small ads, each of which have different
strengths. The Business Link website (www.businesslink.
gov.uk) has a detailed guide.

Assessing potential markets
Beforemakinglargeinvestmentsinyournewproductorservice,it’sagoodideatoassesshowitwilltintothe
marketplaceand–mostimportantly–whetheryouwillbeabletobuildaprotablebusinessaroundit.
Before making large investments in your new product
or service, it’s a good idea to assess how it will t into
the marketplace and – most importantly – whether you
will be able to build a protable business around it.
11
To identify your competitors, don’t just research what’s
already out there. You also need to be constantly looking
out for possible new competition. You may want to consider
selling or looking to license their IP before somebody else
takes it up.
Understanding your competitors
The best way to understand your competitors is to monitor

the way they do business. Information on the internet can
give you good tips on what businesses are doing. Find
out who aims at your market and how they go about it, for
example:
• what they provide and how they market, distribute and
deliver it;
• their brand, design values and prices;
• how they keep their customers loyal to their product;
• whether they use new products or business methods;
• how many staff they have and the quality of staff they
attract;
• whether they have a website or e-mail address;
• who owns the business and what sort of person they
are; and
• what is in the annual report (if they’re a public
company) or their accounts at Companies House
(www.companieshouse.gov.uk)
or the Northern Ireland Companies Registry
(www.detini.gov.uk) if they’re a limited company).
It may be useful to go to exhibitions and trade fairs to
check which of your competitors have displays. Upcoming
events are listed on the Business Link website (www.
businesslink.gov.uk/bdotg/action/event).
Use main libraries to study trade publications and business
magazines.
You can access information about UK trade associations
and business sectors from the Trade Association Forum
(www.taforum.org). You could also speak to your local
Chamber of Commerce (www.chamberonline.co.uk).
Business reference libraries can supply directories and

survey reports.
Staying ahead in the market
Once you are up and running, like all businesses you need
to keep improving your idea to plan for and respond to the
changing needs of your customers. This means investing
time and money into market research and developing your
idea.
The Business Link Research, Design and Development
guide (www.businesslink.gov.uk) explains why developing
your idea is vital to staying competitive. You can nd
out how new and original your business is on the
Living Innovation website (www.innovation.gov.uk/self_
assessment).
The Manufacturing Advisory Service (www.mas.dti.gov.uk)
also has a fact sheet about management techniques.


Identifying your competitors
There is always competition between businesses. But it is not just another business that might attract your
customers, it could be a new product or service.
The best way to understand your competitors is to monitor the
way they do business. Information on the internet can give you
good tips on what businesses are doing
12
Business Plan Services specialise in helping with business
planning (www.bizplans.co.uk) but you can also look at
sample plans on the bplans.org.uk website or templates on
Microsoft Ofce (www.ofce.microsoft.com).
Developing your business acumen
If your project is to be successful, you need to develop

your business acumen. This means:
• having a good understanding of how your idea can
make you money;
• having a thorough understanding of what increases
prots;
• focusing on the market; and
• having a ‘big picture’ of the business and its
environment.
‘Starting Up’ on the Business Link website (www.
businesslink.gov.uk, or www.bgateway.com in Scotland)
gives guidance on how to go about starting your own
business. It includes tools to assess your qualities as a
businessperson, your business skills, your knowledge of
market-research techniques and your nancial commitment
to help you decide whether you are ready to get going.
Being clear on these issues is particularly important if
you’re looking for nance or investment. The process of
building your plan will also focus your mind on how your
new business will need to work to have the best chance of
success.
Managing the development
Carefully managing your project is vital in making sure you
can successfully develop new products or services. You
will need to:
• control costs and set aside resources;
• develop your product;
• work out who’s in charge, who does what and when; and
• sort out any problems.
You should set deadlines for when you will complete
important tasks, but your plan must allow for problems that

may arise which could change the project or your business.
You may want to consider hiring a professional project
manager, for example, through the Association of Project
Managers (www.apm.org.uk).
The Association of Project Management Group have a
website (www.apmg-icp.com) which allows members
to share ideas. The Ofce of Government Commerce’s
website has details on managing projects (www.ogc.gov.
uk/prince2).


Planning your project
Onceyouhaveidentiedyournewproductorservice,youmustthenplanhowyouaregoingtogetittothe
marketandgoaboutturningitintoaprotablebusiness.
Business Plan Services specialise in helping with
business planning
13
Use your own money to set up your business
If you’re starting a new business, it’s likely that you’ll have
to put up some of the money yourself. Financing your
business yourself gives you far more control than other
types of funding, but you must be aware of the risks. If
your business fails, you could lose your home and other
personal belongings.
Borrowing from friends and family
Friends and family may be willing to help by lending money
or by buying a share of your company. But remember, you
could risk losing their money as well as your own.
You should give possible investors an up-to-date business
plan, and have an agreement that sets out terms and

conditions deadlines (such as for paying interest and
repayments). You and your family may also need to pay
more tax (for example, on interest-bearing loans).
Using bank loans to start your business.
Before lending you money, your bank will want to know that
you are a good risk – new companies can nd this difcult
to show, because they do not have a track record to draw
on.
Usually, the bank will want you to:
• present a realistic business plan;
• provide evidence that you have a successful track
record in business;
• offer security for any money it lends you; and
• invest some money in the business yourself.
If you don’t meet all the bank’s normal conditions, you may
qualify for a loan under the Government’s Small Firms
Loan Guarantee scheme (www.businesslink.gov.uk, or
www.bgateway.com in Scotland).
Funding your business
There are many ways to fund your growing business. It’s a good idea to get professional advice before looking
for sources of funding (see www.businesslink.gov.uk, or www.bgateway.com in Scotland).
Friends and family may be willing to help by lending money or by buying a share of your
company. But remember, you could risk losing their money as well as your own.
14
Business angels are individuals who invest on their own,
or as part of a group of investors, in businesses which tend
to grow quickly. As well as money – usually up to £250,000
– business angels often make their own skills, experience
and contacts available to the company they invest in. The
British Business Angels Association (www.bbaa.org.uk)

can give you more information.
Venture capitalists usually invest anything from £500,000
to £2 million or more. They choose businesses they
believe will give a high return on their investment and
projects with clear exit times. The British Venture Capitalist
Association (www.bvca.co.uk) represents over 180 UK-
based private-equity and venture-capital rms.
Before approaching potential investors, you need a good
business plan, along with evidence of your ability to
manage a business. Your plan should include detailed
nancial forecasts and explain what you will do with funds
which are invested in the business. You will also need to
prepare a ‘pitch’ (a presentation to help sell your business
to potential investors).
Grants
In the UK, there are many types of grants available – for
example, from the Grants for Research and Development
Scheme (which is run by the Research Development
Agencies (www.dti.gov.uk/rda/info)
and the Small Firms Loan Guarantee(www.businesslink.
gov.uk).
In Europe, there is the Framework Programme (cordis.
europa.eu/fp6)
and EUREKA (www.eureka.be/thematic
aboutStrategicInitiatives.do).
They are good sources of cheap nancing and may also
provide expert advice and information.
To qualify for a grant, your business must meet the
conditions set by the scheme. If accepted, you will have to
use the funds for a specic project and the grant will only

cover a percentage of your costs. There is often strong
competition for the schemes and the application process
can be complicated and take a long time.
The Business Link website (www.businesslink.gov.uk)
outlines all the types of grants which are available.



Attracting partners
Outside funding can suit opportunities for long-term investment. Usually, your company gives investors part-ownership in
return for their investment. As a result, the investors will share in the prots of your business.
Business angels are individuals who invest on their own, or as part
of a group of investors, in businesses which tend to grow quickly.
15
Creative industries have a range of business options, and
the DCMS website includes information on how to get
funding (see www.culture.gov.uk/creative_industries/).

Research councils (www.rcuk.ac.uk) fund academic
research and training. They aim to turn academic or
business ideas into money-making processes and
products. Each research council has its own procedure for
awarding research and development (R&D) grants.
The Small Business Research Initiative is designed to
make it easier for smaller rms to get contracts from
government organisations to carry out research and
development (see www.sbri.org.uk).
Knowledge Transfer Partnerships run throughout the UK
and aim to bring graduate researchers into businesses
(see www.ktponline.org.uk).

Knowledge Transfer Networks offer grants which are
designed to create networks between businesses,
academic institutions and trade associations. You can nd
more information on the DTI website at
www.dti.gov.uk/innovation.
Collaborative research and development grants encourage
businesses to team up and consult with the research
community. The level of grant support will vary between
25% and 75% of both partners’ R&D costs. You can nd
more information on the DTI website
(www.dti.gov.uk/innovation).
The Shell Technology Enterprise Programme (STEP)
is a scheme designed to help small or medium-sized
businesses or community organisations. The business
pays a student a weekly training allowance for the length of
the project. In return, the business receives support from a
local STEP manager (see www.step.org.uk).
LINK collaborative research encourages the industry
and academics to work together on research projects.
All LINK projects must involve at least one company and
one research-based organisation. Large and small UK
companies and even multinational companies can take
part (www.ost.gov.uk/link/).
Tax relief and allowances for research and
development
Businesses that carry out research and development can
often reduce their tax bills by claiming relief. For more
information, see the HM Revenue & Customs website
(www.hmrc.gov.uk/randd).

Government support
Thereareanumberofgovernmentprogrammeswhichcanoffersupport,anditcanbeworthndingoutifthey
offer help for your type of business. There are also a range of grants available to SMEs (see www.grantnet.com).
Businesses that carry out research and development
can often reduce their tax bills by claiming relief.
16
Checklist
Check that the idea is new.
Assesswhereyouwilltinthemarket.
• Choose your target customers.
• Know your customers’ needs, identify the types of customers and how to sell to them.
• Set out your costs and nd out what customers will pay.
Identify competitors.
Protect your idea with appropriate IP and think about enforcement.
Prove the idea works.
• Research and develop your business, new products and services.
• Get the design right, test it and develop prototypes.
Get the professional help you need, for example:
• Business advisors, solicitors, accountants, and patent and trademark attorneys.
Sort out a business plan.
• How do I survive until my business is off the ground?
• Predict and plan your sales.
• Plan your marketing strategy, and identify potential sales methods.
• Do market research and get market reports.
• Choose and protect your business name, and create a brand.
Use your business plan to get funding, for example.
• Investors (equity), business partners, grants or venture capitalists.
Consider your business options.
• For example, licensing, manufacturing, joint venture, franchising,
subcontracting and so on.

Starting a business.
• Budget and plan your business.
• Plan your cashow and how to get paid on time.
• Examine your nance options, both to start off with and if you run out.
• Decide whether to lease or buy assets.
• Choose the legal structure for your business.
• Choose and run a business bank account.
• Sort out your tax and record-keeping.
• Assess whether you are responsible for paying National Insurance, business rates,
VAT, and other business taxes, reliefs and allowances.
• Assess risks and your responsibilities for health, safety, security and the environment.
• Insure your business and its assets and get liability insurance.
• Set up your premises and negotiate with suppliers.
Running the business.
• Pricing the product or service.
• Marketing your product or service and staying ahead in the market.
• Control your business costs and stock.
• Consider whether to sell direct, how you will distribute your products, and setting up
and promoting your business online.
• Get the most from IT in your business – for example, through e-marketing,
e-commerce, and accepting online payments.
Keeping to the law.
• For example, the Sale of Goods Act, Data Protection, fair trading, trade descriptions
and trading standards, product liability, the Information Commissioner’s regulations.
• Review the regulations that affect your business, investigate and apply for the licences
and permits.
17
FireAngel decided to go it alone.
They initially received a £55,000 European grant but the
product developed some problems in the rst year and

the grant was soon used up. They then received another
£250,000 through a group of ‘business angels’ and, by
concentrating mainly on developing and marketing their
product, they saved money. Within 12 months, their
product was independently tested to the relevant British
Standards and available to buy in the UK.
Fire Angel eventually won a contract with B&Q for three
months, which was followed by a two-year merchandising
agreement. Other national retailers also become involved
and, within 12 months, the FireAngel PS-101
Plug-In Smoke Alarm was available in over 3000 shops
across the UK.
FireAngel®
Within four years, FireAngel had won a number of
awards including the Real Business/CBI New Product of
the Year. In 2001, Sprue Aegis became a public limited
company with a turnover (for the three months up to June
2003) of £515,000 – a 46% increase on the same three
months in 2002. FireAngel have extended their products
internationally, to 18 patents (either granted or in progress),
plus protection for a range of trademarks. A new name
– AngelEye – has been registered specically for the
American smoke-alarm market.
Sprue Aegis plc will continue to invest heavily in developing
new products for both the FireAngel and AngelEye brands.
The company’s attitude is that they can only progress
competitively if they continue to develop original products,
meaning that new patents are expected in the years to
come.
The FireAngel PS-101 Plug-In Smoke Alarm was

available in over 3000 shops across the UK.
18
Chris and his team at Solio knew that, in the growing
mobile-phone industry, battery and energy technology put
huge limits on the product. Phones were adding features
such as TVs and radios, but they drained the battery
quickly. Chris saw huge advantages in using solar energy
– it’s environmentally-friendly, convenient and free!

Research showed that solar chargers already on the
market didn’t work well, and were poorly designed and
marketed. Better Energy Systems (BES) wanted to
develop a brand that was a ‘must-have.’ To get a unique
design, Chris appointed a designer called David Fowler.
Chris then approached a US solar-energy manufacturer,
who were making a similar product, but had no
patent. Chris wanted to learn from them, as he had no
manufacturing experience and hoped to share the costs.
The discussions were successful and Chris signed a
Solio
development agreement, allowing the manufacturer to own
50% of the solar technology. Once BES had developed
their actual design for ‘Solio plug into the sun’, they could
then register their design with the UK Patent Ofce.
BES also approached engineering rms in Germany
to run tests on the battery life and the toxic parts of the
equipment. They also worked with Motorola®, Orange®,
Apple® and Vodafone®. These links gave Chris access to
expertise that he did not have. However, every discussion
meant that more people were learning about his new ideas.

Chris used non-disclosure agreements and contractors’
agreements to make sure that anything created through
Solio was still BES’ property. As Chris said: ‘When anyone
is starting to develop a new product, who you talk to about
it is key you don’t just disclose to everybody what you are
doing. If you do disclose, make sure you have a watertight
condentiality agreement.’
Chris and his team at Solio knew that, in the growing mobile-phone
industry, battery and energy technology put huge limits on the product.
19
A DTI SERVICE
How to Apply to
Register a Design
UK Intellectual Property Ofce is an operating name of the Patent Ofce
This booklet will help you apply to register a design in
the United Kingdom. It also includes information about
applying to register a design outside the UK.
UK Intellectual Property Ofce is an operating name of the Patent Ofce
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UK Intellectual Property Ofce is an operating name of the Patent Ofce
Copyright gives the creators of certain kinds of material
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PATENTS: Essential Reading
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This booklet provides information you need to consider
before committing yourself to applying for a patent, a
summary of the patenting process in the UK and abroad.
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PATENTS: Application Guide
UK Intellectual Property Ofce is an operating name of the Patent Ofce
This guide is all about how to apply for a UK patent. Before you apply, there
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Patents
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3. Patents: Basic Facts
Designs
4. How to Apply to Register a Design
5. Designs: Basic Facts
Copyright
6. Copyright: Basic Facts
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7. Trade Marks: Essential reading
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reading’, will help you apply to register a trade mark in the UK.
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UK Intellectual Property Ofce is an operating name of the Patent Ofce
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