Fundraising & IP
Aligning Capital and Intellectual Property from the Start
Fundraising is more than pitching a product—it’s about building investor confidence in the long-term defensibility, scalability, and value of the business. For technology-driven companies, that confidence often hinges on the quality of the intellectual property. Founders must understand how their IP will be scrutinized during diligence, and investors must evaluate whether the IP supports the valuation and protects the upside.
At every stage of financing, intellectual property plays a role—sometimes directly, sometimes quietly, but always strategically.
For Founders: Preparing IP for the Raise
Intellectual property should be treated as a core business asset, not as a technical afterthought. Investors increasingly expect founders to demonstrate that the company’s key innovations are protectable, that ownership is secure, and that IP strategy aligns with the business’s competitive position.
Before approaching institutional investors, founders should:
- Ensure all IP is assigned to the company. Any delay in assigning rights from founders, employees, contractors, or prior employers can raise red flags and cause friction in diligence. Investors expect clean, unambiguous title to all core IP.
- File provisionals before pitching core innovations. If the pitch includes the substance of your technology, file a provisional application first. This preserves your rights in the U.S. and internationally, and signals discipline.
- Avoid overclaiming IP strength. Simply stating “patent pending” is not enough. Investors look for meaningful, well-drafted filings that cover commercially relevant aspects of the business. Be transparent about what is filed, what is still in development, and how the IP fits into your roadmap.
- Frame the role of IP in your growth story. Whether IP supports exclusivity, protects licensing potential, or acts as a moat around critical tech, you should be able to articulate how your filings contribute to long-term value creation.
What Investors Look For in IP Before They Invest
Framing Your IP to Withstand Venture-Scale Diligence
Venture capital firms investing in technology companies expect more than a “patent pending” stamp—they expect intellectual property to reflect the same level of thought, precision, and strategic intent as the rest of your business plan. While every investor has their own lens, most will evaluate IP through the same fundamental criteria during diligence.
At Schmeiser Olsen, we regularly work alongside venture-backed companies and their investors. Below are the common markers of IP maturity that professional investors typically review prior to making an investment:
- Ownership is clear and complete. All intellectual property must be assigned to the company—not held by founders, employees, or third-party developers. This includes clean assignment documentation for all inventors and proper IP provisions in past employment and contractor agreements.
- Filing strategy aligns with the company’s core value. Investors often review provisional and non-provisional applications for technical depth and relevance. Claims (or at least disclosed embodiments) should track with what’s actually differentiating the product or service—not just incidental improvements.
- No prior disclosure issues. Funders may examine whether the technology was presented publicly—at pitch events, conferences, or on the company website—before a patent filing. In some cases, this can jeopardize international rights or create enforceability risks. A filing should be in place before key public moments.
- Trademarks support brand positioning. For companies with strong consumer or enterprise branding, early filings for the company name and core product names show foresight. Investors expect founders to secure brand assets early in the go-to-market process.
- IP is integrated into the business narrative. Sophisticated investors don’t just want filings—they want to understand how your IP supports pricing power, competitive advantage, licensing potential, or barriers to entry. The more clearly this story is framed, the stronger the perception of value.
When founders address these issues proactively, IP diligence becomes a validation exercise—not a barrier. And for firms that are serious about long-term defensibility, these signals provide early proof that the company is worth backing.
Fundraising Milestones and IP Maturity
Different funding stages come with different expectations around intellectual property:
| Stage | IP Expectations |
| Pre-Seed | Founders should have assigned IP to the company and avoid public disclosure risks. At least one provisional may be expected for core tech. |
| Seed Round | Early filings covering the core concept, clean IP ownership, and a plan for conversion and strategy. |
| Series A | Clear filing roadmap, international considerations (PCT), some issued IP or published applications. Investors expect substance and structure. |
| Series B+ | Active IP portfolio management, potential enforcement or licensing strategy, freedom-to-operate comfort, and evidence of IP’s role in valuation or defensibility. |
A mismatch between stage and IP maturity—whether overdeveloped or under-protected—can signal misalignment. The goal is not perfection, but progress, strategy, and credibility.
Final Thought
In fundraising, intellectual property is both a proof point and a multiplier. It demonstrates that the business is building something worth protecting—and that the team knows how to protect it.
Whether you’re raising capital or preparing to deploy it, aligning IP and funding strategy is essential for building a company that lasts beyond the next round. To discuss how Schmeiser Olsen supports early-stage companies and venture funds with IP strategy and diligence, contact us here.