IP Assignment

A legal agreement that formally transfers ownership of intellectual property from one party to another. Founders typically assign IP they create to the company entity rather than holding it personally.

If a founder personally owns the IP of a company rather than assigning it to the company entity, investors cannot safely fund the business. IP assignment is a non-negotiable requirement in due diligence for any funded company.

A technical co-founder builds the core software before the company is incorporated. Without an IP assignment agreement, the code belongs to her personally, not the company. Investors flag this in due diligence and refuse to close until she assigns the IP to the company.