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Last Update: Friday December 15, 2017

Key Idea: Clear Your Name First

The founder of Jagged Edge Mountain Gear suffered for not doing due diligence  before she settled on a name for the company.

Key Question:

A: 

You have to pay attention to all the details of business even before you start. For example, clear your name before you invest in it.

Margaret named the company Jagged Edge, did enough research to discover that Jagged Edge had been used by a lingerie shop in Hollywood, but because she could not find a contact, assumed the business was inactive. Inactive or active, people hold rights and these rights have to be respected, or one pays the consequences. Had Margaret done a name search with the Patent and Trademarks Office, they may have decided on another name; the mistake cost them. Jagged Edge of Hollywood received a monthly licensing fee, then a one-time buyout for the rights.

Q: Why didn't Paula and Margaret just rename their company?

A: They had fallen in love with the name and felt they had too much invested in it to let it go. Since they were able to come up to an agreement, they lived with the expense and considered it part of the cost of doing business. But it is not trivial. The Hollywood folks got $2500 per year for four years; then, in a final settlement they received $10K in cash and another $10K in stock.

Ouch.

Think about it

What discovery process did you go through to make sure you were not going to be guilty of trademark infringement?

Clip from: Jagged Edge Mountain Gear

Enjoy your summer while you have it!  Winter will return!

Telluride, Colorado and Moab, Utah: Deep-seated within every American is the dream of starting and owning a business. Most of us are barely aware that this concept is deeply ingrained in our culture. The modern concept of a corporation actually has its roots in the American revolution. This drive to start a business -- to incorporate under a name -- mystifies much of the world and it has a lot to do with one's sense of purpose or "calling" and also one's process of self-actualization.

In this episode of the show, you meet many very special people, but the stars are Margaret Quenemoen and her sister, Paula. It will become quickly apparent that they are identical twins who share a huge love of life. Their honesty and integrity, their openness and their achievement, their vision and their tenacity, over-qualify them to be our MasterClass teachers.

So, let's drive into the deep mountains of Colorado to look at their foundations, business plan, financing, direct public offering, and so much more.

We'll learn what went right, what went wrong, and what their vision of the future is.

Jagged Edge Mountain Gear (MQ)

Margaret Quenemoen, Founder

223 E. Colorado Ave.
PO Box 2256
Telluride, CO 81435

Visit our web site: http://www.jagged-edge-telluride.com

Business Classification:
Retail

Year Founded: 1991

Clear Your Name First

PAULA: This business has been an exercise of jumping over one problem after another after another. After a while, they don't even bother you anymore. You can sleep at night just fine, because you're so used to the big problems. When we first started out, one day I recognized, `Hey, we don't have Workmen's Comp'; and that's scary, and we need to get everything on board.

And within about the first year of the business, we made the decisions that no matter what it took, we never wanted to have some horrible thing put us out of business, like having an employee fall off of a ladder and not have workmen's comp in place, or have a disgruntled employee come back and say, `Hey, you don't have unemployment insurance.'

We couldn't afford that. So we do everything orthodox. We never break the rules.

MARGARET: Another thing we initiated is we buy an accident policy for everybody that works here, because as active as everybody is, I don't want anybody to not have any insurance.

PAULA: And we had a trademark issue...

HATTIE: Oh, you did.

PAULA: We knew about Jagged Edge Hollywood, who makes sequined denim jeans and lingerie. But we tried and tried to contact her, and we were unsuccessful, and we thought that she'd gone out of business, and one day, Jagged Edge Hollywood resurfaced, and it was a very serious blow to our business. We didn't know if we could keep our name, and that was quite a bit of legal action and negotiating, but we've taken it out and come with an agreement.

HATTIE: So you negotiated an agreement with her. And you're paying her--What?--sort of a licensing fee to use the name.

MARGARET: Mm-hmm. It's perpetual.

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