What’s in a name?

As a marketing tool, your startup company’s name should align with your marketing strategy. At the same time, legal considerations impact your options during the naming process. The following seven steps will help you navigate those issues and create a strong name for your US startup company.

  1. Positioning statement

If you have not yet done so, draft a positioning statement for your company. To be effective, your positioning statement should identify your company’s:

  • Target customer
  • Market segment
  • Practical benefit for the customer
  • Differentiating features
  • Emotional benefit for the customer

Don’t confuse the positioning statement with an elevator pitch. An elevator pitch is communicated externally and can have legal repercussions. The positioning statement, on the other hand, is strictly for internal use, so you can be aspirational without concern for legal ramifications. Despite those differences, both your elevator pitch and your positioning statement will likely contain at least two keywords for search engine optimization (SEO).

  1. Brand personality

After you have formulated a concise positioning statement, breathe life into it by developing a brand personality. As the embodiment of how you wish the market to perceive your brand, your brand personality should have distinguishing character traits. To get started, decide whether any of these adjectives describe the personality of your brand:

Accomplished, authentic, carefree, clever, cocky, competent, cosmopolitan, creative, diligent, down-to-earth, empathic, energetic, enigmatic, folksy, fun-loving, kind, methodical, naïve, outgoing, pragmatic, reliable, shady, shy, sincere, sophisticated, spontaneous, stoic, tenacious, vivacious, wise, woke.

Limit yourself to the three strongest characteristics, thereby caricaturing your brand personality in a way that can easily be described to internal stakeholders and agencies.

  1. Communication Plan

Determine the media you will use to get your marketing messages to your target customers.

  • If your website and social media are the primary platforms for communicating your messages, inclusion of a keyword in your company name may support your SEO strategy.
  • If your communication plan focuses instead on other types of digital media (eg, email), broadcast media (eg, TV and radio) or print media (eg, pamphlets and newspapers), a catchy empty vessel name can also be effective.
  1. Name ideation

Now review your positioning statement, brand personality and communication plan as you start thinking of name ideas. Although some people have a knack for name ideation (eg, Daenerys of the House Targaryen, the First of Her Name, The Unburnt, Queen of the Andals, the Rhoynar and the First Men, Queen of Meereen, Khaleesi of the Great Grass Sea, Protector of the Realm, Lady Regent of the Seven Kingdoms, Breaker of Chains and Mother of Dragons), uncreative individuals can also create strong names if they understand the principles of trademark law.

Even without submitting a trademark application, your startup company’s name may automatically enjoy limited trademark protection in the geographic region where your company conducts business. Registering a trademark for your company name, however, conveys additional advantages:

  • Nationwide exclusivity of your trademark
  • Minimized risk that you are infringing another company’s trademark
  • Minimized risk that counterfeit products (that improperly bear your mark) will be imported into America
  • Easier registration of your trademark in other countries
  • Better outcomes in infringement lawsuits (by making it easier for you to meet burden of proof requirements)

Trademarks help consumers identify the source of the underlying goods and services. To help reduce confusion in the marketplace, your trademark must be distinct. The more distinct your company name, the easier it will be to trademark it. There are five legal categories of name distinctiveness.

IMAGE SOURCE: Jordan Counsel

  • From a legal perspective, the strongest candidates for trademarks are those that are fanciful; that is, the name is a newly coined word. Because fanciful names have no inherent meaning, they can easily accommodate future expansions of the company into new market segments.
  • Arbitrary names are like non sequiturs; they’re real words that have no literal correlation to the product or service offered by the company.
  • Suggestive names, which are the most common type of trademarks, connote the company’s offerings or value proposition.
  • Descriptive names (ie, surnames and names that explicitly describe the company’s product or service) are not eligible for trademark protection unless they achieve a secondary meaning that signals a recognizable, distinct source of the product/service. For example, the name “McDonald’s Bar-B-Que” (opened in 1940) was certainly descriptive, while that restaurant’s shortened rechristened name certainly signals a recognizable and distinct source. Because descriptive names often indicate a particular niche, later expansion of the company into new market segments may require modification of the company name.
  • Generic names are generally not eligible for trademark protection. This principle also applies to names that are foreign translations of a generic word. The litmus test is whether an ordinary consumer in America who happens to know that foreign language would be expected to translate that word into English. For example, a startup car-sharing company cannot register a trademark for the company name “Coche”, as that is simply a direct Spanish translation of the word “car.”

Once you have a handful of name candidates, your lawyer can do a trademark search to ensure those trademarks are available. Even if you forego registering your company name as a trademark, conducting a trademark search can help you avoid future infringement lawsuits by uncovering similar trademarks owned by other companies.

  1. Domain name availability

In addition to buying exact match domains, consider purchasing domain names that are misspellings of your company name. You could then set up 301 redirects to the properly spelled domain.

  1. State corporate law compliance

Each US state has its own set of rules governing the names that can be used by businesses in that state. While there are overarching principles that are common in all states, the following rules are particularly applicable to New York companies.

Company Form: Business corporations must contain the word “corporation”, “incorporated” or “limited” in their name. LLCs names must include the words “limited liability company” or either “LLC” or “L.L.C.” Similarly, the name of a limited partnership must contain the words “limited partnership” or “L.P.”

Distinguishability: Your company name must be distinguishable from other business names on file in the state where you will form your company. Minor indistinguishable modifications of the name will not suffice. For example, if the business name “Mr. Seller & Son LLC” is already registered in your target state, you will not be allowed to register any of the following names in that state:

  • Mr. Seller & Son Corporation
  • The Mr. Seller & Son LLC
  • Mister Seller & Son LLC
  • Mr. Seller and Son LLC
  • Mr. Seller & Sun LLC
  • Mr. Cellar & Son LLC
  • Mr. Seller & Sons LLC

Restricted Words: Depending on your startup company’s form (eg, business corporation, LLC, not-for-profit corporation or LP), some words may be prohibited or restricted from use in the company name. In New York, the restricted or prohibited words are:

Academy, acceptance, “America Espirito Sport Fraternite”, annuity, arboretum, assurance, attorney, bank, benefit, blind, board of trade, casualty, chamber of commerce, “Citius Altius Fortius”, college, community renewal, conservatory, corporation, cooperative, cooperation, council, doctor, education, elementary, endowment, exchange, fidelity, finance, guaranty, handicapped, historical, historical society, history, incorporated, indemnity, industrial organization, institute, insurance, investment, kindergarten, labor, lawyer, library, loan, mortgage, museum, nursery school, Olympiad, Olympic, Pan-American, Paralympiad, Paralympic, partnership, prekindergarten, preschool, redevelopment, savings, school, secondary, state police, state trooper, surety, tenant relocation, title, trust, underwriter, union, United Nations, university, urban development, urban relocation.

  1. Trademark registration

Some aspects of the trademark registration process (eg, description of your goods/services, proper selection of your class of goods/services and method of formatting the information to be submitted in the trademark application) are technical and may be better handled by an attorney.

After your trademark application is approved, maintain its validity by:

  • Monitoring for infringement by other companies
  • Every sixth year, filing a Declaration of Continued Use (or a Declaration of Excusable Nonuse), also known as “Section 8 Declarations”
  • Every sixth and tenth year, filing a Renewal Application, as well as Section 8 Declarations

In summary, although a rose by any other name may smell as sweet, creation of a company name is a pivotal milestone in the launch of your startup company. Defensively, your trademarked name can help protect your business. Strategically, your company name may pave the way for your marketing messages to reach new customers.