One of the common mistakes made by startups and even more mature companies is failing to make sure that they own the copyright in important content or software.  Many small companies will hire outside contractors to build websites, create custom software and even develop items such as logos which the company will use in marketing.  This is often the only way that such items can be developed.  Unfortunately, many companies fail to consider who actually owns the copyright.

Just because a company paid for work does not mean it owns the copyright.  Many companies incorrectly believe that they own all rights because they paid the contractor to develop the work.  Unfortunately, that is usually not the case.  Section 101 of the Copyright Act discusses "works made for hire."  A work made for hire is deemed to be the work of the employer, not the employee.  Thus the copyright is owned by the employer.

 The work for hire rule, however, applies in limited circumstances - usually when the creator is an employee or the work is a commissioned or ordered part of a collective work and there is a written agreement.  In other situations, the work is not a work for hire.

What this means is that the contractor who wrote the program, developed the content or created the logo is usually the owner of the copyright.  This means the contractor may be free to walk across the street and sell the program the company paid $100,000 to create to the company's competitor for $50,000 or $20,000 or $1.50.  Talk about losing your competitive edge.

Having the contractor own the copyright can also become a problem if you try to move the work to another medium.  If there has been a falling out, the contractor may demand more money for further use of the work. 
Such disputes can be disastrous for a small company.

The way to avoid such matters to it deal with the issue upfront.  Who will own the copyright?  If the company will, it will need to get an assignment from the contractor.  If the contractor insists on retaining the copyright, the company should consider agreements that will limit the contractor's ability to sell the software in the company's line of business and which expressly grant the company the ability to copy the work and/or to create derivative works.  

Regardless of what arrangement the parties agree to, it should be in writing.  Who owns the copyright will probably effect the price that is being paid and the benefits that each party obtains from the relationship.  However, failing to deal with the ownership issue upfront will almost always result in one party getting much less than they bargained for.

If the work is important to the company, have the agreement prepared by an attorney.  A few hundred or even a few thousand dollars is much less expensive than losing a potential acquisition when it is learned that the company does not have clear title to important software or content.