As a founder, you're juggling a thousand priorities. It's tempting to see intern paperwork as a low-priority task. You might think, "They're only here for a summer," or "They're just working on a small, isolated project." This is one of the most common and potentially costly mistakes a startup can make. An Intern Proprietary Information and Inventions Agreement (PIIA) is not just bureaucratic busywork; it's a foundational pillar of your company's value.
Interns, especially in a startup environment, are rarely cordoned off from the core business. They write code that gets shipped, they analyze real customer data, they contribute to marketing strategies, and they are present in meetings where your company's future plans are discussed. They are, in effect, temporary employees with access to the crown jewels.
Without a signed PIIA, the legal default for ownership of the intellectual property (IP) they create can be murky. An intern could potentially argue that they own the copyright to the code they wrote or a patentable process they developed during their internship. This creates a "cloud" on your IP title.
Why does this matter? Imagine two years from now, you're in the middle of a Series A fundraising round or, even better, an acquisition. The investor's or acquirer's legal team will conduct rigorous due diligence. One of the first things they will ask for is a complete list of everyone who has ever contributed to your product or IP, along with their signed PIIAs. If you have a gap—a former intern who contributed significantly to your codebase but never signed an agreement—the entire deal can be jeopardized. The due diligence team will see a potential ownership claim, a risk they are unwilling to take. You may be forced to spend a small fortune tracking down that former intern and negotiating to buy back the rights to work you already paid them to create.
The Intern PIIA solves this problem cleanly and proactively. It establishes two critical principles from day one: 1. Confidentiality: The intern agrees to keep your company's secrets secret, both during and after the internship. 2. IP Assignment: The intern agrees that the company owns all the inventions and work they create as part of their internship.
Think of it as essential corporate hygiene. Just as you wouldn't build a house on an unstable foundation, you shouldn't build a company on uncertain IP ownership. The Intern PIIA is the concrete that secures your company’s most valuable assets.
Section 1: Nondisclosure — What Counts as Proprietary Information
The core of any PIIA is the promise of secrecy. This section sets the ground rules for what your intern can and cannot share about your business. It is intentionally broad to protect every facet of your company, from your code to your customer list.
The central obligation is laid out in Section 1.1: At all times during and after my internship, I will hold in strictest confidence and will not disclose, use, lecture upon or publish any of the Company’s Proprietary Information... The key phrases here are "at all times during and after" and "strictest confidence." This obligation doesn't end when the intern gets their final paycheck; it is a perpetual duty. This is critical because the value of your trade secrets doesn't expire when an internship term does.
So, what exactly is "Proprietary Information"? Section 1.2 defines this term expansively. It’s not just about source code. The template provides a non-exhaustive list, which is worth breaking down for your intern:
(a) Inventions: This is the most obvious category. It includes trade secrets, inventions, mask works, ideas, processes, formulas, source and object codes, data, programs, other works of authorship, know-how, improvements, discoveries, developments, designs and techniques. If an intern is writing software, designing a UI, or experimenting with a new algorithm, their work falls squarely in this bucket. (b) Business Information: This is equally important and often overlooked. It covers your strategic DNA: information regarding plans for research, development, new products, marketing and selling, business plans, budgets and unpublished financial statements, licenses, prices and costs, suppliers and customers. An intern who helps build a sales lead list or sits in on a product roadmap meeting is handling Proprietary Information. (c) Internal Company Information: This includes information regarding the skills and compensation of other employees of the Company. This clause is designed to prevent an intern from sharing salary data or internal performance reviews, which could disrupt the team or be used by a competitor.
As a founder, you should emphasize that this definition covers not just finished work, but also ideas, "know-how," and "plans." The half-formed idea discussed at a whiteboard session is just as protected as the final, deployed code.
The section does include a crucial carve-out. The intern is free to use information which is generally known in the trade or industry, which is not gained as result of a breach of this Agreement, and my own, skill, knowledge, know-how and experience. This is a fairness provision. You are not claiming ownership of the general skills a software engineering student learns in their university courses. You are only protecting information that is specific and confidential to your company. This clause makes the agreement more reasonable and therefore more enforceable.
Your job as a founder is to help the intern understand this distinction. They can use their knowledge of Python to work for you and then for someone else. They cannot, however, use the specific Python script they wrote for your proprietary data analysis pipeline for anyone else.
Section 2: Assignment of Inventions — Who Owns the Intern's Work
This section is the heart of the "Inventions" part of the PIIA. While Section 1 prevents the intern from sharing your secrets, Section 2 ensures that any work they create for you belongs to you. Without this section, you would be paying an intern to create intellectual property that they could legally own.
The key provision is Section 2.3, Assignment of Inventions. It states: I hereby assign and agree to assign in the future... to the Company all my right, title and interest in and to any and all Inventions... made or conceived or reduced to practice or learned by me... during the period of my internship with the Company.
"I hereby assign...": This language is crucial. It’s a "present assignment" of future inventions. This means that ownership of the invention automatically transfers to the company the moment it is created. You don't need another document or a future signature. This is legally robust and is what investors and acquirers look for. "...all my right, title and interest...": This is legal shorthand for complete and total ownership. It’s not a license; it’s a full transfer of the deed to the IP. "...made or conceived or reduced to practice or learned...": This is intentionally broad. It covers the flash of an idea ("conceived"), the first prototype ("reduced to practice"), and even knowledge gained along the way. "...during the period of my internship...": This defines the scope of the assignment. It applies to work done while they are formally an intern for you.
To reinforce this, Section 2.7, Works for Hire, adds another layer of protection for copyrightable material like code, documentation, or design assets. It states that such works are considered "works made for hire" under U.S. Copyright Law. For employment relationships, this means the company is considered the author and owner from the start. Including both assignment and "work for hire" language provides a belt-and-suspenders approach, creating the strongest possible ownership position for the company.
Notably, a well-drafted PIIA like this template also protects the intern with Section 2.4, Unassigned Inventions. This clause is legally required in some states (like California) and is a best practice everywhere. It clarifies that the company is not claiming ownership of inventions the intern develops entirely on my own time without using the Company's equipment, supplies, facilities, or trade secrets and that are not related to the company’s business.
Example 1 (Company Owned): An intern uses their company-issued laptop on a Saturday to write a script that improves the company’s data processing pipeline. Even though it was on a weekend, it used company equipment and directly related to the company's business. The company owns it.
Example 2 (Intern Owned): That same intern, on that same Saturday, uses their personal computer to develop a mobile game about their cat. It has nothing to do with your B2B SaaS product. The intern owns it. This clause gives them the confidence that you are not trying to own their entire life.
Finally, Section 2.8, Enforcement of Proprietary Rights, is a practical necessity. It requires the intern to assist the company in securing the IP, such as by signing patent applications or other legal documents, even after the internship has ended. The company agrees to pay them for their time for this post-internship assistance. This prevents a situation where you can't file for a patent because a former intern is unresponsive.
This section is the mirror image of the assignment clause. While Section 2 transfers ownership of new inventions to the company, Section 3 is designed to identify and protect the inventions the intern already owns before they walk in your door. It is a critical step for maintaining "clean" IP.
The mechanism for this is Section 2.2 and the attached Exhibit A: Previous Inventions. The agreement states that Inventions, if any... which I made prior to the commencement of my internship with the Company are excluded from the scope of this Agreement. Exhibit A is the formal list where the intern must declare these "Prior Inventions."
As a founder, your role is to ensure the intern takes this exhibit seriously. It is not optional. When onboarding, you should explicitly ask: "Do you have any personal projects, open-source contributions, inventions from a previous job, or university projects that are relevant to the work you'll be doing here? We need to list them on Exhibit A."
1. It Protects the Intern: It officially documents what they own, so the company can't later claim ownership of their pre-existing work. This is fair and builds trust. 2. It Protects the Company: This is the more critical part for you. If an intern incorporates their pre-existing project into your company's product without your knowledge, you are now using IP you don't own. This is called "tainted IP."
Consider this scenario: A brilliant intern has built a custom data-parsing library for a personal project. During their internship, to save time, they incorporate that library into your product's codebase. If that library was not listed in Exhibit A and no separate license was granted, your company's core product now contains code that, legally, a former intern owns. This is a five-alarm fire during due diligence.
Section 2.2 directly addresses this risk by stating: I agree that I will not incorporate, or permit to be incorporated, Prior Inventions in any Company Inventions without the Company’s prior written consent.
Your process should be: 1. Insist the intern completes Exhibit A. If they have nothing to list, they should check the "No inventions or improvements" box. A blank exhibit is ambiguous. 2. If they list a Prior Invention, have a conversation. Ask if they foresee using it in their work. 3. If they do intend to use it, you must get a license. This might be a simple, written "permission to use" grant, or it may require a more formal open-source license review if the project is public. The key is to get that prior written consent mentioned in the agreement.
Ignoring Exhibit A is an unforced error that can create a ticking time bomb in your company's IP portfolio.
Section 4: Third-Party Information & No Conflicting Obligations
Startups do not operate in a vacuum. You have obligations to your partners, clients, and vendors, and your interns must abide by them. Furthermore, your interns have obligations from their past experiences. This cluster of clauses ensures that information flows only where it's supposed to and that your company isn't contaminated by IP from another business.
Section 1.3, Third Party Information, deals with confidential information you receive from others. The agreement states the intern understands the company has received confidential or proprietary information ("Third Party Information") subject to a duty on the Company’s part to maintain the confidentiality of such information. The intern agrees to hold this information in the strictest confidence.
Practical Example: Your company signs an NDA with a potential partner to evaluate their API. The API documentation is now "Third Party Information." An intern working on the integration is bound by that NDA through their PIIA. They can't blog about the API or push code with the API keys to a public GitHub repository. This clause extends your duty of confidentiality to everyone on your team.
Section 1.4, No Improper Use of Information of Prior Employers and Others, and Section 6, No Conflicting Agreement or Obligation, work together to protect your company from inbound contamination.
An intern coming from a summer at a large tech company, another startup, or a university research lab has been exposed to their confidential information. The last thing you want is for them to bring that information into your company. This could lead to a lawsuit from their former employer accusing you of trade secret misappropriation.
Section 1.4 makes the intern promise they will not improperly use or disclose any confidential information or trade secrets, if any, of any former employer and will not bring onto the premises of the Company any unpublished documents or any property belonging to any former employer.
Section 6 strengthens this by having the intern represent that their work for you does not and will not breach any agreement or obligation they have with a prior employer.
This is your "clean hands" provision. You are making it the intern's explicit responsibility not to bring in outside IP. During onboarding, it's wise to state this plainly: "We're excited to have you, but we are only interested in the work you do here. We respect the confidentiality of your previous employers, and we expect you to do the same. Do not use any code or confidential documents from any previous internships or jobs in your work for us."
This puts the onus on the intern and provides your company with a powerful defense if an issue ever arises.
This section, which appears as Section 7 in the template (Return of Company Property and Documents), is a simple but crucial logistical component of offboarding an intern. It ensures a clean break and minimizes the risk of a post-internship data leak.
The clause is straightforward: When I leave the internship with the Company, I will deliver to the Company any and all property... and all drawings, notes, memoranda, specifications, devices, formulas, and documents, together with all copies thereof...
The key is to think of "Company Materials" in both physical and digital terms.
Physical Property: This is the easy part. The clause explicitly lists laptop computers, cell phones, PDAs, credit cards, keys, key cards. You need a checklist to ensure you collect all company-issued hardware on their last day.
Digital Property: This is more complex and far more important. The "drawings, notes, memoranda... and documents, together with all copies thereof" applies to files on their hard drive, in their email, in their personal cloud storage, and in any other digital format.
This section is the enforcement mechanism for the Nondisclosure agreement (Section 1). The easiest way for an intern to accidentally (or intentionally) breach confidentiality is to walk away with a copy of your data. This clause gives you the contractual right to demand it all back.
Your offboarding process must be as rigorous as your onboarding process. It should include: 1. Collecting all physical company property. 2. Ensuring the intern has returned or certified the deletion of all company data from personal devices. If they used a personal laptop (a practice you should generally avoid), you need to supervise the deletion of the company's code and data. 3. Revoking access to all company systems: corporate email, Slack, GitHub, AWS, Figma, Notion, etc. Do not just deactivate their account; remove them. 4. As part of the process, have them sign a termination certificate (as mentioned in the clause) confirming they have returned all materials and complied with their PIIA.
Think of it this way: a copy of your entire codebase on a former intern's laptop is a massive liability. This clause gives you the power to prevent that from happening.
While interns are temporary, the relationships they build can be lasting. This section aims to protect your company's two most valuable assets—your team and your customers—from being poached after the intern leaves. It also provides a mechanism for ensuring the intern's confidentiality obligations are respected in their next role.
This section references two distinct parts of the template: Section 5 (No Solicitation) and Section 10 (Notification of New Employer).
First, Non-Solicitation. Section 5 of the template establishes a restricted period (for one (1) year after the date my internship... ends) during which the intern agrees not to: (i) solicit or attempt to solicit any employee of the Company to end his or her relationship with the Company... (ii) solicit any... customer of the Company... to diminish or materially alter its relationship with the Company.
It's important to understand what this is not. It is not a non-compete. The intern is free to go work for a direct competitor. Non-compete agreements are notoriously difficult to enforce, especially for junior-level individuals like interns, and are banned in several states.
A non-solicitation agreement, however, is much more reasonable and enforceable. It simply says, "You can work wherever you want, but you cannot actively try to convince our employees to leave with you, nor can you try to steal the customers you worked with." Even for an intern, this is valuable. They may form a strong bond with a key engineer or have been the primary contact for a design partner. This clause prevents them from leveraging those relationships to harm your business after they depart.
Second, Notification of New Employer. Section 10 is a powerful, proactive tool. It states: I authorize the Company to provide notice of my rights and obligations under this Agreement to any subsequent employer...
This means if your intern goes to work for a competitor, you have the right to send a letter to that competitor's HR or legal department. The letter would state that the individual was a former intern, is under a continuing obligation of confidentiality per their PIIA (a copy of which you might include), and that you expect the new employer to respect those obligations.
This serves two purposes: 1. It puts the new employer on notice, making them liable if they induce the former intern to spill your trade secrets. 2. It acts as a strong deterrent to the intern, who will not want to start a new job by creating a legal issue between their new and former employers.
You won't use this right in every case, but having it in your back pocket is a valuable way to protect your most sensitive information.
Section 7: General Provisions (Governing Law, Arbitration, Severability)
This final section of the agreement, often called "General Provisions" or "Miscellaneous," contains the legal boilerplate that makes the contract work. It might seem dry, but these clauses are the nuts and bolts that determine how the agreement is interpreted and enforced. For a founder, understanding the gist of these is important.
Governing Law; Consent to Personal Jurisdiction (11.a): This clause specifies which state's laws will be used to interpret the contract (here, Delaware) and where a lawsuit can be filed. Choosing a predictable and corporate-friendly jurisdiction like Delaware is standard for incorporated startups, regardless of where they are physically located. This prevents disputes over where to have the legal fight.
Severability (11.b): This is a critical failsafe. It says that if a court finds one part of the agreement to be invalid, illegal or unenforceable (for example, ruling that the one-year non-solicitation period is too long), it doesn't void the entire contract. The court can either strike that one clause or "blue-pencil" it (reduce it to a reasonable scope), and the rest of the PIIA—including the all-important IP assignment and confidentiality clauses—remains in full force.
Successors and Assigns (11.c): This ensures the agreement is binding on the intern's "heirs" and benefits the company's "successors, and its assigns." The latter part is vital for M&A. It means that if you sell your company, the buyer (the "successor") automatically receives the benefit of all your intern PIIAs. The IP ownership transfers cleanly.
Survival (11.d): This explicitly states that key obligations will survive the termination of my internship. This reinforces that confidentiality, for example, is a lifelong duty, not something that ends on the intern's last day.
Entire Agreement (11.f): This is also known as a "merger clause." It states that this PIIA is the final, complete and exclusive agreement of the parties and supersedes and merges all prior discussions. This is hugely important. It means that any verbal promises or side-conversations are legally irrelevant. If you told an intern, "Oh, don't worry about that clause, we'll never enforce it," this provision renders that statement meaningless. All binding terms are within the four corners of this document. It also requires any future changes to be in writing and signed by both parties.
While you don't need to be a lawyer to be a founder, knowing what these clauses do helps you understand the strength and resilience of the legal armor you're putting in place for your company.
Having a great PIIA template is only half the battle. Its power comes from proper execution. A sloppy or rushed signing process can undermine its effectiveness. Here is a simple, 10-minute checklist to integrate into your intern onboarding process to ensure every PIIA is handled correctly.
1. Send in Advance. Email the PIIA to the intern at least a few days before their start date, along with other new-hire paperwork. This gives them a chance to read it without feeling pressured. Frame it as "standard paperwork for all team members, including interns, to protect the company's confidential work."
2. Schedule a Brief Review. On their first day, set aside 10-15 minutes to review the document with them. Don't just slide it across the table and say "sign here." This shows you take it seriously.
3. Explain the "Big Two" in Plain English. You don’t need to read the whole document aloud. Focus their attention on the two most important concepts:
Confidentiality (Section 1): "This section says that the work we do here—our code, business plans, customer data—is confidential. You have a duty to keep it secret, both during and after your internship."
IP Ownership (Section 2): "This section clarifies that the company owns the work and inventions you create as part of your job here. This is standard and ensures our company owns the product we're all building together."
4. Tackle Exhibit A Directly. Open the document to Exhibit A ("Previous Inventions"). Ask them directly: "Do you have any personal projects, code you've written for school, or other inventions that we should list here to make sure it's clear they belong to you?" Help them understand this protects them. If they have none, have them check the "No inventions" box. Do not let them leave it blank.
5. Watch Them Sign and Date. Ensure the intern signs and dates the agreement in the correct spot.
6. Countersign Immediately. As an officer of the company, you must sign and date the "Accepted and Agreed To" section. An agreement only signed by the intern is an unforced error.
7. Scan and Secure the Original. Immediately scan the fully executed agreement and save it to a secure digital location (e.g., your HR cloud folder, a folder in Dropbox/Google Drive named "Executed PIIAs"). The physical original should also be stored safely.
8. Provide a Copy. Email a PDF of the fully signed agreement to the intern for their records. This is a good faith gesture and ensures everyone has a copy of what they agreed to.
The path to a solid IP foundation is paved with good intentions, but many founders make simple, avoidable mistakes. Being aware of these common pitfalls is the best way to ensure you don't fall into them.
1. The "It's Just an Intern" Handshake Deal. This is the original sin of intern IP management. A founder believes a verbal agreement or a series of emails is "good enough." It is not. Without a signed PIIA that explicitly assigns invention rights, the legal ownership of the intern's work is, at best, ambiguous and, at worst, belongs to them. This mistake can cost tens of thousands of dollars in legal fees to clean up during a fundraise or acquisition.
2. Using a Flimsy or Inappropriate Template. Pulling the first "IP Agreement" from a Google search is dangerous. Many free templates are low-quality, designed for freelancers instead of interns/employees, or are specific to the laws of a state you don't operate in (e.g., a California-specific template for a Texas-based company). Using a battle-tested template like the one provided, vetted by startup lawyers, is essential.
3. Signing It Too Late (The Retroactive PIIA). The PIIA must be signed at the beginning of the internship as a condition of the engagement. If you try to get an intern to sign it on their last day, they have zero incentive to do so. They could refuse, leaving you with a gaping hole in your IP chain of title. Even worse, they could demand additional payment to sign, effectively holding the IP they created hostage.
4. Ignoring Exhibit A. A founder tells the intern to "just sign the agreement" and doesn't mention Exhibit A. The intern leaves it blank. Later, it comes to light they used a significant personal project in their work. Now you have an IP "taint" issue with no clear documentation of what was pre-existing. Ambiguity is the enemy of clean IP. Forcing a clear "yes" or "no" on Exhibit A resolves this.
5. Forgetting to Countersign. The intern signs, hands you the paper, and you toss it on a pile of paperwork to be "filed later." You never countersign. While an agreement signed only by the intern may sometimes be enforceable, it is significantly weaker. The countersignature from a company officer proves the company formally accepted the agreement. A missing countersignature is a red flag for any due diligence lawyer.
6. Sloppy Offboarding. The intern leaves with their company laptop for "an extra week to finish up a few things." They have copies of your codebase, access to your cloud services, and sensitive documents in their personal Dropbox. A clean break is a safe break. Failing to enforce the "Return of Company Materials" clause is like leaving your front door wide open after they leave.
Avoiding these common mistakes doesn't require a law degree. It requires process and discipline. By treating your Intern PIIA as the critical legal document it is from day one, you are building a valuable, defensible company.
Disclaimer: This guide is for informational purposes only and does not constitute legal advice. The information provided is not a substitute for obtaining legal advice from a qualified attorney. The legal principles discussed are general in nature, and their application can vary widely based on the specific facts and circumstances of your situation and the governing law. You should consult with your own legal counsel to review and customize any legal agreement, including a PIIA, for your company's specific needs.
