Equity and IP

Equity

Some Startup Studio teams may choose to leverage their Startup Studio projects and co-found real startup companies after graduation. At that time, the co-founders will capitalize the company, which includes establishing relative equity positions of the co-founders, initial employees, advisors, and other participants of the company.

For the purposes of Startup Studio, teams should not be concerned with their equity positions (other than to understand the concept intellectually). Startup Studio is for academic purposes, and the level of effort of students should not be confused with "sweat equity" in a real startup company: all students on the team are full-time students and have demanding academic loads, of which Startup Studio is a small part.

However, teams who intend to found real companies after graduation based on their Startup Studio projects are recommended to attend the extracurricular Spinout Clinic near the end of the semester. At the Clinic, students will learn about typical equity structures for startups and be connected to startup lawyers that can advise and facilitate the legal process of capitalization. At this time, nearing graduation, teams will be in a position to assess the forward-looking commitments of their teammates and capitalize the new venture appropriately.

Intellectual Property (IP)

During the course of Startup Studio, teams of students create IP in the form of inventions, software, trademarks, etc. As part of Startup Studio, this IP is created for academic purposes to enhance the educational experience of the students.

However, in some cases, some or all of the students may want to build upon the IP they created during Startup Studio in a commercial context after graduation, such as commercializing the IP as part of a startup company, filing a patent, selling the software, open sourcing the software, etc.

In order that any given individual student or group of students on the team can reasonably use the IP after graduation, the students on a team must come to an agreement about their rights to the IP they create during Startup Studio. Cornell Tech has developed a standard agreement in this regard called the Cornell Standard Project Agreement for Student Collaborations (CSP-SC).

Without such an agreement, IP developed by one student as part of the collaboration might be solely owned by him or her to the exclusion of the other students, and co-invented or co-authored IP might be jointly owned by two or more of the students subject to rules of use that the students didn’t intend, in each case creating potential conflicts in the rights of the students to use the IP after graduation.