In the early days of a startup, most founders are obsessed with product design, fundraising, and market strategy—but they often forget one of their most valuable intangible assets: the brand itself.
This year, a Chinese AI startup named DeepSeek fell into a classic “brand protection trap” in the United States. Before it had time to register its U.S. trademark, someone else filed for the exact same name.
Here’s the catch: under the “first-to-file” system used by the U.S. Patent and Trademark Office (USPTO), the agency doesn’t check whether the applicant is acting in bad faith or “riding on a trend.” As long as the paperwork meets formal requirements, the application proceeds to publication. If the original owner doesn’t file an opposition in time, the mark could be officially registered under someone else’s name.
Once that happens, reclaiming your trademark becomes an uphill legal battle—costly, slow, and distracting. For a fast-growing company, this kind of surprise can completely disrupt its business rhythm.
Tesla once experienced a similar nightmare when entering the Chinese market. Years before Tesla officially launched in China, a local company had already registered the “TESLA” trademark. When Elon Musk’s team tried to use the name, they found it wasn’t legally theirs. After lengthy negotiations, Tesla reportedly paid tens of millions of RMB to settle and reclaim its name—a painful and expensive lesson.
Changing Attitudes Toward “Bad-Faith” Filings
In recent years, Chinese authorities have taken a stronger stance against malicious trademark registrations. Following public scandals and international disputes, the China National Intellectual Property Administration (CNIPA) and the courts have stepped up enforcement.
Now, if the applicant clearly acted in bad faith—for instance, registering a well-known foreign or domestic brand with obvious intent to profit—the trademark office can reject or later invalidate the mark.
The U.S., however, takes a very different approach: it’s a self-help system. You must actively protect your rights. The USPTO won’t step in on your behalf if someone else registers your brand. Even if you’ve already used the mark, you must formally oppose or cancel the competing application yourself.
Adding to the challenge, U.S. law allows Intent-to-Use (ITU) applications—meaning someone can file first and show actual use later. If you haven’t yet entered the market, that person’s filing could take priority.
The Real Lesson: Your Company Has an ID, But Your Brand Has a Soul
Registering a company gives you a legal identity.
Registering a trademark gives your business a name in the eyes of the world.
Think of it this way: your company is the legal shell—it signs contracts, pays taxes, and hires staff. But your brand is what customers remember and trust.
Apple, Coca-Cola, and Tesla all derive immense value not from their factories or equipment, but from the power of their names and logos.
If your company fails, you can start a new one. But if your brand name is taken by someone else, continuing to use it could be infringement—leading to lawsuits, forced rebranding, or massive damages. For startups, that can be fatal.
Common “Brand Protection Traps”
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Registering only in one country
Many founders register their mark in China and assume that’s enough. Later, when expanding overseas, they discover their name has already been taken. -
Registering only one class
Trademarks are categorized by goods and services. You might register your app under Class 9 (software), but someone else can still register the same name under Class 42 (SaaS services). -
Registering too late
Some founders wait until after multiple funding rounds. By then, brand recognition is high—and trademark squatters are already circling. -
Improper ownership
Some founders register under an individual’s name or an agency’s name, not the company’s. Later, when they try to transfer it back, they face ransom-level fees.
Practical Tips for Entrepreneurs
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File early – Apply as soon as you name your company or product. Cover your key markets (China, the U.S., EU).
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File broadly – Don’t limit yourself to one class; protect your brand in all relevant categories.
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Secure your domain name – Register your .com or other domain early to avoid conflicts.
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Use the Madrid System – For companies going global, the WIPO’s Madrid System allows multi-country registration through one application.
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Check ownership – Ensure all trademarks are registered under your company’s name, not an agent or individual.
Beyond Trademarks: Build a True “Moat”
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Patents – File early for core technologies.
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Copyrights – Protect your code, design, and written works; formal registration strengthens your legal position.
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Trade Secrets – For formulas or algorithms, use NDAs and internal controls.
Together, these protections form the long-term defensive wall around your business. Without them, even the best ideas can be copied—and surpassed—overnight.
In short:
Registering your company is like getting an ID.
Registering your brand is like owning your name.
Don’t let someone else take it first.
