Common Mistakes to Avoid When Naming a Business

Starting a business is exciting, as is picking out a name (or, in legal terms, a trademark) for your new startup. The possibilities may seem endless, or you may have one specific name that you have your heart set on. In picking a name, entrepreneurs may seize upon a certain theme or pun or just wait for a name to pop into their head. If you plan to offer products or services under your new business name, it is essential to carefully consider your options before you dive into branding. These same principles apply to choosing a trademark for a new product or service as well. No matter how you pick your new name, here are some common mistakes to avoid:

1. Descriptive Names. New business owners often want their business names to tell people exactly what products or services they are selling. Own a coffee shop? You might name it Beans and Brews. A convenience store? You might name it In-and-Out. The problem here is that such names are likely to be in use by many other coffee shops and convenience stores, meaning that consumers will find it more difficult to remember your name (because it is not catchy or distinctive) or to find you (and not a competitor) in an online search. Perhaps more importantly, you are more likely to receive a nasty cease and desist letter from a similarly-named company demanding that you stop using the name. Instead of having to completely re-brand later or face potentially substantial legal fees to fight such opposition, try to think of a unique and distinctive name — one that stands out from the crowd from the beginning. Then, if you want to include something descriptive, simply add a tagline.

2. “Borrowing” Names. Whether intentional or not, entrepreneurs sometimes pick business names that are incredibly similar to the name of a previous employer, a business across the street, or a company that caught their attention in the past. Searching for name inspiration on the Internet may lead to clever results, but it can also be risky if someone else is using the same or similar name. Not only might this be trademark infringement, but if proven, such “borrowing” could result in a willfulness finding, significantly increasing the amount of damages the other party can seek in a lawsuit. When thinking about a business name, do not emulate others. Instead, brainstorm distinctive names that will help your business cultivate its own individual brand.

3. Failing To Fully Research a Name. A preclearance search is the foundation on which to build your brand. Performed by trademark clearance experts, a preclearance search scours the marketplace (and not just Google) to find other businesses and products that use the same or similar names as your intended business name. An intellectual property attorney then reviews the report and assesses the risk associated with using your desired trademark. That way you will know up front whether to proceed with the name you have chosen or to avoid major conflicts and go back to the drawing board. Pre-clearing lets you rest easy, knowing that your brand is yours to build into an empire. — Stephanie Martinez

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