Here is something I see regularly with SaaS founders: they assume they own everything their contractors build. The website. The dashboard. The marketing assets. All of it.
They do not.
Copyright law has a default rule most founders never learn until it costs them. The person who creates the work owns it – not the company that paid for it.
That default changes only in two situations: the creator is your employee working within their job scope, or there is a written agreement explicitly transferring ownership to you. No written agreement, no ownership transfer. It is that simple and that dangerous.
The Three Scenarios Playing Out in Your Business Right Now
Your design agency built your brand.
You hired an agency to create your logo, your website design, your product UI. You paid them. You use it every day. But unless your contract included copyright assignment language, they own the creative work. You have a license to use it – but they can sell it, modify it, or restrict your use if the relationship goes sideways.
I have seen this create real problems at acquisition. A buyer’s due diligence team asks for IP ownership documentation. The founder pulls out the agency invoice. That is not ownership. That is a receipt.
A freelance developer built your core features.
This is the one that catches SaaS founders off guard most often. Your contractor wrote the code for your dashboard, your API integrations, your core workflow logic. They were not an employee. Work-for-hire doctrine – which would automatically transfer ownership to you – applies to employees, not independent contractors.
Unless your contractor agreement included explicit copyright assignment language, they own that code. You have whatever rights the contract gave you, which in a generic freelancer agreement is often a license to use it. Not ownership.
You are using stock photos and third-party assets.
This one is less catastrophic but still creates real exposure. Stock photo licenses have usage terms. A license for website use does not automatically cover your pitch deck, your product demo video, or your paid ads. Exceeding license scope is infringement, even if unintentional.
What Actually Protects You
The fix is straightforward. You need two things in every contractor agreement, signed before work begins – not after delivery.
First, “work made for hire” language. This designates the work as created for hire, which under copyright law means ownership vests in you from the moment of creation.
Second, a copyright assignment clause as a backup. Courts sometimes interpret “work made for hire” narrowly for certain creative categories. A direct assignment clause – “contractor hereby assigns all rights, title, and interest in the work to the company” – covers you regardless.
Getting these signed after the work is delivered creates a different problem. If the contractor is no longer engaged, or the relationship has cooled, you are negotiating from a weak position. Get it in writing before the first line of code or the first design file.
For third-party content, build a simple internal log: what you licensed, from where, and what the usage terms allow. It takes 20 minutes and saves real headaches during due diligence or investor review.
Why This Matters More Than You Think
SaaS companies are IP. Your product is your IP. If your cap table is clean but your IP ownership is murky, you have a problem that shows up at the worst possible time – fundraising, acquisition conversations, or a dispute with a former contractor who knows exactly what leverage they have.
This is also where having both business law and IP expertise in the same place matters. A generic fractional GC can draft a contractor agreement. But catching the copyright assignment gap, understanding how it interacts with your employment agreements, and making sure your IP ownership chain is clean for future due diligence – that requires IP-specific depth.
Most of my clients are surprised when we review their existing contractor agreements. The gap is almost always there. The good news is it is fixable, and it is much easier to address proactively than retroactively.
Have you ever audited your contractor agreements for copyright assignment language? I am curious how many founders have actually checked – drop a comment or follow along for more on IP basics that matter for SaaS companies.
About The Garcia-Zamor Law Firm: We provide outsourced in-house counsel combining business law and intellectual property expertise for growing companies. Led by Ruy Garcia-Zamor (founder and business strategy expert), Elliott Alderman (IP specialist with 40+ years experience, former U.S. Copyright Office attorney), and Claudia Castillo (employment law specialist), our team delivers strategic legal leadership scaled to your company’s stage. Learn more at garcia-zamor.com or call (410) 531-9853.
