Ask HN: How to transfer a project IP from a C-Corp to a person?
Basically, I want to figure out the cheapest & lowest-friction way to do this IP transfer.
Some specific questions:
- Any legal document that needs to be signed? I assume there's some kind of IP transfer agreement.
- Does this need to involve attorney? Or if the board of the C-Corp agrees, then just do it (e.g., two parties sign the document, then done)?
- If the IP transfer is done, can that person start a company on the project and raise VC money?
The devil (of course), is in the details - I would definitely check with a lawyer. If money is an issue, then call around - many lawyers will do a free consultation, where they could probably tell you if your situation required a lawyer to draft a document, or just something signed by the board.
Thanks! Yea, we'll definitely check with lawyer first.
I am not an attorney. I recommend hiring one. My lay understanding is that the IP is an asset of the corporation and giving away assets to individuals is likely to be fraught with legal and regulatory hazard. Disputable ownership of IP is the sort of thing that might cause future investment to fall through during due diligence.
Ultimately, the answer to most "do I need a lawyer" questions is, yes, when the stakes are non-trivial.
Good luck.
Thanks! Yea, we'll definitely check with lawyer first.
Get an attorney.
This will very likely have tax implications as the IP has some value, and companies cannot (usually) just give away assets to an individual.
Once you own the IP, you can do (almost) anything you want with it, including start a VC-backed company.
Sounds like the company needs to sell the asset to the individual, under the terms of a contract. It can be sold for $1, by the way. As others have said, talk to an attorney (the company likely already has someone).
It cannot always be sold for $1--the IRS may view the sale as tax evasion if it occurs well below a fair market value.
As an example: if the company had two developers working full-time for a year on the IP, the value of that IP should be in the ballpark of those developers salaries.
This is not always the case, but a reason you should consult an attorney.