By Clarisse Mideva, Prof. Tom Peter Migun Ogada and Dr. Caroline Mbaya
In today’s era of rapid
technological advancement, intangible assets (such as know-how, brands, designs etc.) account for as much as 80% of a company’s total value. Intellectual Property (IP) has become one of the most valuable assets for businesses. Many innovators acknowledge that their ideas are powerful, but few realize the untapped potential to generate revenue from their IP leading to missed opportunities. Your software, technology, brands and creative works all have the potential to help you generate profits and grow your business. Knowing how to capitalize on your IP can significantly impact your financial success and long-term sustainability.
Identifying Intellectual Property
It is important to identify and understand what IP rights you hold to fully exploit them. Intellectual Property comprises intangible products that emanate from the human intellect like inventions, designs, literary and artistic works such as books, art, music etc., symbols, or confidential business secrets that have commercial value as well as new plant varieties. In Kenya, IP is regulated by laws like the Copyright Act, Trademarks Act, Industrial Property Act, and regional and international treaties that are vital for the protection of innovation and creativity. Intellectual Property takes various forms including:
• Patents: Protects inventions and technological innovations. It grants inventors exclusive rights to their inventions for a limited period (20 years from the filing date). and preventing 3rd parties from making, using, or selling the invention.
• Utility Models: For incremental innovations or improvements to existing products or processes. They provide exclusive rights for a shorter period (10 years) and are sometimes referred to as “petty patents.”
• Copyright: For literary, artistic and musical works like music, books, software, films etc. They give creators the right to control the use and distribution of their creations for a lifetime plus 50 years after the death of the author.
• Trademarks: For brand names, symbols, logos, and slogans. They are usually protected for 10 years, however, the protection can be indefinite as long as the mark is used and renewed.
• Industrial Designs: For the ornamental or aesthetic appeal of a product. Industrial designs are protected for 5 to 15 years, depending on the period of extension
• Trade secrets: For confidential business information e.g. manufacturing process, customer lists etc. that provide a competitive advantage to a business. They have no fixed duration and last as long as the information remains secret.
• Plant Breeders Rights: For new, distinct, uniform, and stable plant varieties, which is particularly relevant for agricultural innovators. They grant breeders exclusive control over the sale and reproduction of their plants for 25 years (Fruit trees, rootstocks, forest, ornamental trees, and grapevines) and 20 years (other plants) from the date of registration.
• Geographical Indications: Protects products that originate from a specific geographical origin and possess qualities, characteristics or a reputation due to that origin, such as Kenyan tea or coffee
• Traditional Knowledge: Protects Indigenous knowledge, cultural expressions, and practices that are often passed down through generations Once you identify your IP rights, you should take steps to protect it. By registering your IP rights in all the markets you want to operate in, your innovation is protected from imitation and competitors are prevented from commercially exploiting it.
Ways to make money from your Intellectual Property
I. Commercialize your IP independently
This approach involves launching your new product or service independently and establishing your market presence. By doing this, you retain full ownership and control of your IP and can develop, manufacture and distribute products or services based on your IP. To commercialize independently, you need to ensure that your IP is adequately protected to prevent copying or infringement by competitors.
Example: If you have invented an electric cookstove (protected by a patent), you could start a company to manufacture and sell the cookstove to businesses and consumers, building your brand and retaining all the profits.
II. License your IP
Licensing your IP allows others to use your inventions, creative works or designs for a fee. The license can be limited to specific activities, scope, geographical area, use or application. It takes the form of a right to agree to a 3rd party’s use of the IP which would otherwise have constituted an infringement of the right. A license can be exclusive (granting one party sole rights to use your innovation in a specific area or market), non-exclusive (permitting multiple parties to use your innovation simultaneously), sole (agreeing not to grant any additional licenses but retain the right to make use of the licensed IP) or a combination of these. Licenses may be formal (written), informal and even implied. Since IP rights such as patents only last for a certain period, licensing can be an effective strategy when you don’t have the resources to develop and market your product or service.
Example: Kenyan musicians such as Sauti Sol, Nyashinski etc license their music to streaming platforms like Boomplay, Spotify, Apple Music & YT Music. They earn royalties every time their songs are streamed. This has also expanded their reach both regionally and internationally.
III. Utilize Collective Management Organisations
Copyright grants authors/creators the exclusive rights to exploit their works/creations. An author/creator therefore has to manage these rights by monitoring how they are exploited. This, however, may be impossible to do at an individual level for certain rights and therefore Collective Management Organizations (CMOs) come in handy to simplify the management of these rights on behalf of copyright owners such as musicians, filmmakers, writers, phographers etc. The Copyright Act defines a CMO as an organization which has its main objects or one of its main objects being negotiating for the collection and distribution of royalties and granting of licenses in respect of copyright works of performers. They are in most cases, not-for-profit entities and act based on mandates received from the rightsholders they represent.
Authors/owners of copyright works authorize CMOs to:
• Monitor the use of their works; where, when and what works are used by who
• Negotiate licenses on behalf of its members including tariffs and other conditions of licensing.
• Collect royalties for the works and;
• Distribute these collections to the rightful owners.
Example: In 2024, The Kenya Copyright Board granted a one-year license to the Performing and Audio Visual Rights Society of Kenya (PAVRISK) to manage all rights in music and for performers in the audiovisual sector. PAVRISK collects and distributes royalties to artists.
IV. Assign your IP to someone else
An assignment is the sale of your IP. It involves transferring the ownership of your IP to another party and therefore losing the rights to use the IP. An Assignment can be complete or partial. A complete assignment is where the assignor transfers everything to the assignee, assignor ceases to have exclusive rights to the use and access to the IP, and assignee becomes the new owner of the whole bundle of rights while a Partial Assignment is where parts of the rights are assigned to a third part while the other is retained by the assignor who may further assign them. Assignment of IP rights is beneficial if you do not plan to exploit your IP, lack the resources to take the developed innovation to the market, or you would like to realize an immediate cash flow from your IP.
Once you have assigned your IP rights, you will cease ownership and the assignee (the person to whom the IP is assigned) will bear the risk of commercial development, and be responsible for all costs, including renewal fees and production expenses.
Example: Unilever Kenya Limited assigned several valuable trademarks (i.e. Cowboy, Kimbo, Tiger Brand, Cowboy Spesheli and Veebol) to BIDCO Oil Refineries Limited.
V. Franchising
Franchising is a special form of licensing where you grant one or more parties the right to use your trademark, trade name, business systems, and processes. Franchisees (recipients) operate under these licensed rights to offer goods or services as outlined in the franchise agreement (a legal document that outlines the terms and conditions of the franchise), and in exchange, they pay royalties and fees to the franchisor (IP owner). This model benefits both parties: franchisors can expand their business with lower investment, while franchisees gain easier market entry by leveraging an established brand and a proven business model.
Example: MINISO, a Japanese-inspired lifestyle product retailer successfully opened over 6000 stores in over 100 countries, including Kenya, through franchising. Their franchise model has allowed Kenyan entrepreneurs to operate MINISO outlets in various malls, contributing to the brand’s widespread presence in Kenya.
VI. Merchandising
Merchandising is where brands or other creative works are transformed into products that consumers can purchase. It involves leveraging IP to create marketable goods such as toys, apparel, accessories etc. The IP owner grants a license to manufacturers or retailers to produce and sell merchandise based on the IP thus creating new revenue streams.
Example: Tusker Lager, a beer brand in Kenya, implemented merchandising strategies & licensed its logo to manufacturers who produced a wide range of branded merchandise such as t-shirts, caps, beer glasses etc. which became sought after by consumers. Through this, they generated additional revenue and created a strong brand.
VII. Brand extension
A brand is a combination of factors that gives a product or service its identity, reputation, and perception, therefore differentiating it from its competitors, while a trademark is the legal protection that safeguards the brand elements, such as logos, names, slogans, or symbols. A Brand name on the other hand is the ‘glue’ that holds together the identification of a trademark by the consumer to the product or service, creating a unique and memorable identity in the minds of consumers. Brand extension leverages an existing brand name, reputation and market recognition by introducing/launching new products and services under the established brand. By expanding the product range while maintaining core brand values, new revenue streams are created.
Example: Safaricom is known for its mobile telecommunications services. However, the company has successfully expanded into various sectors, such as mobile banking (M-Pesa), e-commerce (Masoko), and even health (Safaricom Health – M-TIBA). These brand extensions have allowed Safaricom to capitalize on its strong customer base and trust, diversifying into new markets with minimal risk.
VIII. Joint Ventures
Joint Ventures involve two or more entities pooling their IP assets to develop a new product, service or technology together and share resources, risks, and rewards for the development. Joint Ventures allow businesses to leverage each other’s strengths, access new markets, accelerate innovation, and share development costs by combining complementary IP portfolios.
Example: In 2022 Sony and Honda announced a joint venture to develop an electric vehicle. 
Sony is a well-known electronics company while Honda is a prominent automobile company. The joint venture aimed to develop and design the electric vehicle using Honda’s skills in mobility development and plant for manufacturing and Sony’s expertise in immersive entertainment in gaming, electronics, audio and visual technologies. Together, they revealed the prototype of a new electric sedan under the Joint Venture “Afeela” that they plan to sell in the U.S. as soon as 2026.
IX. Use your IP as collateral to obtain financing
Kenya’s Movable Property Security Rights Act of 2017 recognizes IP as an intangible asset that can be used as collateral for loans and other financial obligations. When you pledge your IP as collateral, you grant the lender security over your IP rights, allowing them to seize and sell the asset if you default on the loan. To secure financing, your IP must generate cash flows that can be used for loan repayment. Additionally, it should be identifiable, separable from your business, and backed by clear ownership documentation. Proper valuation is also crucial, as it determines the IP’s worth as collateral. Before proceeding with a valuation, consult your lender to understand the accepted valuation methods and requirements.
The Green and Digital Innovation Hub (gDIH) being a one-stop-shop that aims to contribute to the digital transformation of Kenyan enterprises, is committed to helping innovators understand and protect their IP through the African Centre for Technology Studies (ACTS) Intellectual Property (IP) Unit. The IP unit helps innovators protect, manage and commercialize their IP and fosters a culture of innovation by educating innovators on IP rights and best practices. If you would like to receive support and guidance on how to safeguard and commercialize your innovations, please fill in this form to apply for our IP Services:
https://forms.office.com/r/ZCyPJAXkTM?origin=lprLink
REFERENCES
https://www.wipo.int/edocs/pubdocs/en/wipo-pub-2011-en-securing-loans-with-your-ip-assets.pdf
https://www.wipo.int/edocs/pubdocs/en/copyright/955/wipo_pub_955.pdf
https://www.wipo.int/export/sites/www/copyright/en/activities/pdf/wo_inf_108.pdf
https://www.innovationagency.go.ke/storage/pub-docs/ken_pub_INNOVATORS_GUIDE_DIGITAL.pdf
https://tax2win.in/guide/difference-between-brand-and-trademark
https://copyright.go.ke/sites/default/files/downloads/FAQs%20on%20CMOs-%20WEB.pdf
https://www.wipo.int/en/web/copyright/collective-management
https://www.caranddriver.com/news/a42400955/afeela-sony-honda-ev/
