Company Registration Intellectual Property Rights Test Marketing Product Launch Scale-Up/Commercialization and Funding

NC1901 – ENTRENEURSHIP
DEVELOPMENT
Module III
• Company registration
• Intellectual Property Rights
• Copyrights
• Test marketing
• Product launch
• Scale-Up/Commercialization and Funding
Dr. Sreeya B, Associate Professor, SSL,

SIMATS 1
Company
A company is an artificial person created by law. It is a
voluntary association of individuals for profits.
 According to Section 3(1)(i) of the Companies Act, a
company means, “ A company formed and registered
under this Act or an existing company.”

SIMATS 2
Characteristics of Company
 Artificial Person
 Common Seal
 Perpetual Succession
 Limited Liability

SIMATS 3
Types of Company
 Incorporated Companies: These are the association of
persons who contribute money to a common stock
known as capital of the company. They have existence
independent of its members.
 Unincorporated Companies: These are the mere
collection of persons who have agreed to join in
partnership to run a business and share the profits.

SIMATS 4
Types of Company
 Chartered Companies: The ‘Crown’ in the exercise of the royal
prerogative has power to create a corporation by the grant of a
charter to persons assenting to be incorporated. Such companies or
corporations are known as chartered companies.
 Statutory Companies: A company may be incorporated by means
of a special Act of the Parliament or any State Legislature. Such
Companies are called statutory companies. Such companies are
generally formed to carry out some special public undertakings,
e.g., railways, waterways, gas, electric generation etc. They are
governed by the Acts creating them. Dr. Sreeya B, Associate Professor, SSL,
SIMATS 5
Types of Company
 Registered Companies: Companies registered under the
Companies Act,1956, or the earlier Companies Acts are called
registered companies. Such companies come into existence when
they are registered under the Companies Act and a Certificate of
Incorporation is granted to them by the Registrar.
 A company registered under the Act may be:
 i. Companies limited by shares: In a company limited by shares
the liability of the members is limited by the memorandum to the
amount, if any, unpaid on the shares respectively held by them.

SIMATS 6
Types of Company
 ii. Companies limited by guarantee: It is a registered
company public or private, in which the liability of
members is limited to such amounts as they may
respectively undertake by the memorandum to contribute to
the assets of the company in the events of its being wound
up.
 iii. Unlimited Companies: A company not having any limit
on the liability of its members is termed as unlimited
company. Dr. Sreeya B, Associate Professor, SSL,

SIMATS 7
Company Registration Process
 Reservation of Company Name
 Provision for Entrenchment
 Drafting of Memorandum and Articles of Association
 Application for Incorporation of Companies
 Documents to be filed for Incorporation
 Particulars of first directors of the company and their
consent to act as such
 Notice of Situation of Registered Office
 Payment of Fee
 Certificate of incorporation

SIMATS 8
Memorandum of Association
 Main document of the company.
 It defines the objects of the company for which it is
established.
 Lays down the conditions upon which alone the
company allowed to be formed.
 Charter of the constitution of the company.
 It defines the scope of its activity and also states that
anything beyond it is unauthorized and illegal.

SIMATS 9
Memorandum of Association
The Memorandum of Association
 Must be printed
 Divided into paragraphs
 Signed by each subscriber (seven or more in case of a
public company)
 Add his name, address and description
 Presence of at lease one witness who is to attest the
signature. Dr. Sreeya B, Associate Professor, SSL,

SIMATS 10
Contents of MOA
 Name of the company
 Registered office of the company
 Objects of the company
 Liability of the members
 Details of the capital of the company
 Subscription or Association clause

SIMATS 11
Name Clause
 The Company is a legal entity. Therefore, it must have
its name to establish its identity.
 The name of the company should not be Similar,
Undesirable, or which will mislead the public. E.g.
Indian National flag, name or pictorial representation of
Mahatma Gandhi or Prime Minister of India, etc.
 The company can change its name by passing a special
resolution and obtaining he approval of the Central
Government.
SIMATS 12
Registered Office Clause
 Every company must have a registered office from the
day it starts its business or within 30 days of getting the
Certificate of Incorporation, whichever is earlier.
 Memorandum of Association must state the name of the
State in which the registered office of the company is
situated. It determines the jurisdiction of the company
 This clause is important as it mentions the residence for
the purpose of the communication with the company.

SIMATS 13
Object Clause
 It defines the limits and extent of the activities of the
company.
The 3 types of objects are:
 Main objects
 Objects incidental or ancillary to the attainment of the
main objects.
 Other objects: Objects stated in the main objects are to
be pursued by the company immediately after
incorporation or within reasonable time

Dr. Sreeya thereafter.
B, Associate Professor, SSL,
SIMATS 14
Liability Clause
 This clause states that the liability of the members is
limited to the extent of the shares subscribed by the
member or shareholders if the company is formed with
share capital.
 Amount of capital with which the company is to be
registered and its division into shares of a fixed amount
must be stated in the MOA of a company.
 The capital with the company is registered is called
“Authorized capital” or “Registered

SIMATSCapital”.
15
Article of Association
 Defines the responsibilities of the directors, the kind of
business to be undertaken, and the means by which the
shareholders exert control over the BOD.
 Contains the rules & regulations for the internal
management of the company.
 AOA needs to be filed with the Registrar of Company.
 AOA can be altered from time to time.

SIMATS 16
Contents of AOA
 Share capital
 Payment, calls, transfer, lien, conversion, transmission,
forfeiture etc. Of shares
 Share certificate & warrants
 Rights of shareholder
 Meetings
 Appointment, remuneration, qualification, powers etc.
Of Board of Directors
SIMATS 17
Contents of AOA
 Accounts & Audit
 Payment of dividends
 Winding up
 Indemnity

SIMATS 18
MOA Vs. AOA
MOA AOA
It is a charter of a company It contains rules & regulations

determining constitution and activities regarding internal management of the
of the company. company.
Every company must have a Public companies limited by shares
memorandum. may or may not have articles.
Alteration of Memorandum is much Articles can be easily altered by a

difficult and strictly regulated. special resolution.
Prior permission is required. No need for permission(in some

cases)
Defines the relationship between Defines the relationship between

company & outsiders. management & shareholder.

SIMATS 19
Certificate of incorporation
 After the RoC is satisfied that all documents and information
which is required has been filed in the prescribed manner and
along with prescribed fee, the Certificate of Incorporation
shall be issued by the Registrar in Form No. INC-11
 Every company must have a registered office from the day it
starts its business or within 30 days of getting the Certificate
of Incorporation, whichever is earlier. Memorandum of
Association must state the name of the State in which the
registered office of the company is situated.
 This clause is important as it mentions the residence for the
purpose of the communication with the company. It
determines the jurisdiction of the company and also mentions
the place where all the records of company are maintained.
Where the company wants to change its registered office from
one state to another then it can do so by passing a special
resolution as well as by confirmation of Company Law Board.
SIMATS 20
WIPO
WIPO (World Intellectual Property
Organization) was established by the WIPO
Convention in 1967
The WIPO is a specialized agency of the
United Nations
It promote the protection of IP throughout
the world
Its headquarters are in Geneva, Switzerland
World Intellectual Property Day is declared
as April 26 Dr. Sreeya B, Associate Professor, SSL,
SIMATS 21
Intellectual Property
 Intellectual Property is a property that arises from the
human intellect.
 It is a product of human creation.
 IPR is a right which give monopoly of any
intellectual creation of mind.
 It is a combination of science and technology both.
 It is given for any new creation such as composition
of music, writing of a book, new invention.
 Intellectual Property comprises 2 distinct forms:
* Literary & Artistic Works
* Industrial Property Dr. Sreeya B, Associate Professor, SSL,
SIMATS 22
SIMATS 23
Industrial Designs
Design deals with features, shapes, patterns,
etc., applied to an article by an industrial
process, manual or mechanical.
Eg., chair is a utility item. However, chair itself
does not qualify for IPR, but its special
carvings, embossing etc., is done which
increases the value of chair though it’s utility
remains same, it becomes eligible for IPR under
Designs Act.
Designs can be registered based on its
originality, henceforth they can use ® or
registered, with registration number.

SIMATS 24
Patent Rights
Is a monopoly right granted to a person, who
invented a new product or process of making an
article, for 20 years under the Indian Patens Act,
1970, and can be renewed after expiration of
period.
The inventor has to file for patent first, and then
make his/ her invention to public.
A patent has to be applied in each country by the
inventor, to claim his rights in that country. Eg:
Agroup of scientists working on new drug
development in Himalaya Drugs for some
salary.
The patent of the drug developed is given to
Himalaya Drugs, but not to the scientists.
The drug may have many patents
Dr. Sreeya B, Associate Professor, SSL, like
SIMATS 25
Trademarks
Trademark can be a word, name, brand, symbol,
label etc., used by a company to create a unique
identity for their product.
Trademark can be registered, and then use ™ ®.
The registration validity is for 7 years and
renewable after expiry.
In India, it is governed by the Trade and
Merchandise Marks Act, 1958, which came into
force on 25th Nov., 1959.

SIMATS 26
Trade Secrets
Trade secret is any intellectual work or product
used for a business purpose that can be
classified as belonging to that business provided
it is not based on information in public domain.

SIMATS 27
Geographical Indication
 This is an indication, that originates from a definite
geographical area, which is used to identify natural or
manufactured product.
 For eg., Gadwal/ Pochampally Sarees, Nirmal paintings,
Kolhapuri Chappals, Solapur Chaddar etc., qualify for
registration under this category.
 It is valid for 10 years.
 The application for registration can be an association of
persons, organization or by producers.

SIMATS 28
Copyright
 Itis a negative right which prevents the appropriation of
the fruits of man’s work, labour or skill by another
person.
 Copyright is an exclusive legal right to reproduce an
original work of authorship fixed in any tangible
medium of expression, to prepare derivative works
based on original work, and to perform or display the
work in the case of dramatic, music, choreographic and
sculptural works.
 Copyright prevents copying of only the expression. Eg:
Bhagwat Geeta, Pathanjali Yoga sutras, Narada Neeti,
Vatsayana Kamasutras etc.,

SIMATS 29
Copyright - Meaning
 Copyright is a legal concept, enacted by most
governments.
 A copyright is a law that gives the owner of a written
document, musical composition, book, picture, or other
creative work, the right to decide what other people can
do with it.
 Copyright laws make it easier for authors to make
money by selling their works. Because of copyright, a
work can only be copied if the owner of the copyright
gives permission.
 The Indian CopyrightAct,1957 governs the system of
copyrights in India. [Amended in 1982, 1984, 1992,
1994 & 1999]

SIMATS 30
Copyright - Definition
 According to Eric Miller, “Copyright refers to laws that regulate
the use of the work of a creator, such as an artist or author. This
includes copying, distributing, altering and displaying creative,
literary and other types of work. Unless otherwise stated in a
contract, the author or creator of a work retains the copyright.”
 According to Harrods Librarians Glossary, copyright is, "A
procedure whereby the originator of a piece of intellectual Property
(book, article, piece of music, etc.) acquires a series of rights over
the work created, including copying, publishing, performing,
Broadcasting and adaptation.” Dr. Sreeya B, Associate Professor, SSL,

SIMATS 31
Copy rights is related with four kinds of works
 Literary, dramatic and musical works
 Artistic works
 Cinematographic works
 Record

SIMATS 32
Literary, dramatic and musical works
 Literary work means literature of every kind and
includes works on humanity, religion, social science etc.
 Dramatic works means drama, recitation, choreographic
work, entertainment in dumb show, scenic arrangement
etc.
 Musical work means any combination of melody or
harmony or either printed, reduced to writing or produce
or reproduce
SIMATS 33
Artistic works
 a. Painting, sculpture, drawing, engraving on a
photograph
 b. An architectural work or art
 c. Any other work of artistic craftsmanship

SIMATS 34
Cinematographic works
 It means any sequence of visual images fixed on
materials of any description.
Record
 It means disc, tape or pother device in which sounds are
embodied, so as to the capable of being reproduced their
form.

SIMATS 35
Copyright – Registration Procedure
 Register a copyright by completing a simple application
form, along with the appropriate fee
 Need not send a copy of your work,
 It may appear with the same title, but if each work has
been created independently, each will have its own
copyright protection.

SIMATS 36
Copyright – Duration
 Copyright lasts for the Author’s lifetime + 50 years from
the end of the calendar year in which the author dies,
 50 years for films and sound recordings,
 25 years for typographical arrangements of a published
edition,
 Copyright protection always expires on December 31 of
the last calendar year of protection.

SIMATS 37
Copyright – Duration
 Copyright lasts for the Author’s lifetime + 50 years from
the end of the calendar year in which the author dies,
 50 years for films and sound recordings,
 25 years for typographical arrangements of a published
edition,
 Copyright protection always expires on December 31 of
the last calendar year of protection.

SIMATS 38
Test Marketing
 An experimental procedure provides an opportunity to
test a new product or new marketing plan under realistic
market conditions.

SIMATS 39
Test Marketing Factors
 Investment Cost
 Risk
 Time Pressure
 Research Cost

SIMATS 40
Test Marketing Types
 Consumer Goods Test Marketing
 Business Goods Test Marketing

SIMATS 41
Consumer Goods Test Marketing
 Sales wave research: Giving sample then selling at
reduced price
 Simulated test marketing: Advertisement relative
effective against the competing advertisement
 Controlled test marketing: Offered only in a few areas or
sold at lower price
 Test Markets: Few representative cities, good shelf
exposure, full advertisement and promotion campaign

SIMATS 42
Business Goods Test Marketing
 Alpha Testing: Testing within the company
 Beta Testing: Outside the company

SIMATS 43
Product Launch
 Introducing a new product into the market or adding
new product to existing product

SIMATS 44
Commercialization
New Product Planning Process
 Idea generation
 Product screening
 Concept testing
 Business Analysis
 Product Development
 Test Marketing
 Commercialization

SIMATS 45
Commercialization
 When to launch
 Where to launch
 Planned Market Roll Over Time
 Ordering Material
 Production
 Inventory Build up
 Distribution Shipment
 Sales Force Training
 Trade Announcement
 Customer Advertising

SIMATS 46
Commercialization
 Commercialize the plans and prototypes from
development phase, begin distribution and sale of the
new product and manage the launch program to achieve
the goals and objectives

SIMATS 47
Scale Up
 Itis a part of commercialization, the next stage to which
extent business need to be developed.

SIMATS 48
THANK YOU

SIMATS 49

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NC1901 – ENTRENEURSHIP

Dr. Sreeya B, Associate Professor, SSL,

voluntary association of individuals for profits.

 According to Section 3(1)(i) of the Companies Act, a

company means, “ A company formed and registered

under this Act or an existing company.”

Dr. Sreeya B, Associate Professor, SSL,

Dr. Sreeya B, Associate Professor, SSL,

persons who contribute money to a common stock

known as capital of the company. They have existence

independent of its members.

 Unincorporated Companies: These are the mere

collection of persons who have agreed to join in

partnership to run a business and share the profits.

Dr. Sreeya B, Associate Professor, SSL,

prerogative has power to create a corporation by the grant of a

charter to persons assenting to be incorporated. Such companies or

corporations are known as chartered companies.

 Statutory Companies: A company may be incorporated by means

of a special Act of the Parliament or any State Legislature. Such

Companies are called statutory companies. Such companies are

generally formed to carry out some special public undertakings,

e.g., railways, waterways, gas, electric generation etc. They are

Companies Act,1956, or the earlier Companies Acts are called

registered companies. Such companies come into existence when

they are registered under the Companies Act and a Certificate of

Incorporation is granted to them by the Registrar.

 A company registered under the Act may be:

 i. Companies limited by shares: In a company limited by shares

the liability of the members is limited by the memorandum to the

amount, if any, unpaid on the shares respectively held by them.

company public or private, in which the liability of

members is limited to such amounts as they may

respectively undertake by the memorandum to contribute to

the assets of the company in the events of its being wound

 iii. Unlimited Companies: A company not having any limit

on the liability of its members is termed as unlimited

company. Dr. Sreeya B, Associate Professor, SSL,

Dr. Sreeya B, Associate Professor, SSL,

 It defines the objects of the company for which it is

 Lays down the conditions upon which alone the

company allowed to be formed.

 Charter of the constitution of the company.

 It defines the scope of its activity and also states that

anything beyond it is unauthorized and illegal.

 Divided into paragraphs

 Signed by each subscriber (seven or more in case of a

 Add his name, address and description

 Presence of at lease one witness who is to attest the

signature. Dr. Sreeya B, Associate Professor, SSL,

 Registered office of the company

 Objects of the company

 Liability of the members

 Details of the capital of the company

 Subscription or Association clause

Dr. Sreeya B, Associate Professor, SSL,

its name to establish its identity.

 The name of the company should not be Similar,

Undesirable, or which will mislead the public. E.g.

Indian National flag, name or pictorial representation of

Mahatma Gandhi or Prime Minister of India, etc.

 The company can change its name by passing a special

resolution and obtaining he approval of the Central