First, know that the $16,000 average cost of research and filing a patent is only the start,![\"\"](\"https:\/\/berkonomics.com\/wp-content\/uploads\/2015\/07\/patent-202x300.jpg\")
even if your patent application is not opposed or even if the examiner is reasonably receptive to your brilliant idea.\u00a0 The true average cost of a single patent over the twenty years of its legal life is $56,000, when you consider all costs beyond the initial application process.\u00a0 That\u2019s a lot of money for a startup, and it multiplies quickly when your patent is published for comment or opposition or the examiner continues to deny claims.<\/p>\n
Do you let the world know your innermost secrets?<\/strong><\/p>\n And what do you get for this? \u00a0You reveal to the world the essence of your brilliant idea for all to find work-around methods of accomplishing the same ends.\u00a0 Sometime, simply keeping the trade secret through non-disclosure and confidentiality agreements would be a better service to your idea than a patent. And that\u2019s just about free. And private.\u00a0 So, a patent could be damaging to the startup, not a barrier to entry.<\/p>\n We investors often ask: \u201cWhat\u2019s the patent protection?\u201d as if that would be a guarantee of value, especially for companies in the technology field.\u00a0 Well, there is more to it than that.\u00a0 Shame on us investors for not knowing all the pitfalls involved.<\/p>\n The two requirements of a patent<\/strong><\/p>\n [Email readers, continue here…]\u00a0<\/em><\/span> It is important to note that patents are useful only if they satisfy two requirements:\u00a0 that they protect the brilliant invention you create, and that they are commercially viable in the marketplace.\u00a0 A great idea often never succeeds in the marketplace.\u00a0 Yet, we investors often ask about patent protection before the product or idea is even tested in the market.<\/p>\n How soon must we file a patent to be protected?<\/strong><\/p>\n The United States Patent Office allows a full year after first introduction into the market for the patent to be filed.\u00a0 Most of us believed that the patent filing is required before introducing the idea to the marketplace.\u00a0 That is still true in Europe, but not here.\u00a0 Surprise.<\/p>\n How about provisional patents?<\/strong><\/p>\n And then, many of us investors suggest provisional patent filings as the answer. After all, they give you an additional year of protection at a minimal cost.\u00a0 But did you know that no-one reads the provisional patent at the Patent Office?\u00a0 With the grace year, it would be better to spend the money and time filing the real thing after initial reactions from the marketplace, no matter how limited.<\/p>\n The core of any patent?<\/strong><\/p>\n But there is a good part of the story<\/strong><\/p>\n Patents have made people and companies rich. They have protected their right to their inventions.\u00a0 Patents have allowed companies to spend up to five percent of their gross revenue on research and development.\u00a0 Patents have provided a long, rich royalty stream for inventors.\u00a0 Patents protect inventions in many countries.\u00a0 Without patent protection spending on research would be lower, the possibility of theft of ideas even greater, and many would be poorer than without the patent system.\u00a0 Properly used, patents are an excellent defense for inventors.<\/p>\n More to learn (of course)<\/strong><\/p>\n There is so much more to learn about patents than this.\u00a0 For us investors and for all entrepreneurs with novel and non-obvious ideas to protect, this is one valuable place to spend a little time becoming educated.\u00a0 After all, early stage companies have limited resources, and often the most valuable resource is the core idea that forms the company itself.\u00a0 Protecting that core is an important, but not necessarily an expensive task.\u00a0 So, it is fair to ask, \u201cAre you wasting money filing patents?\u201d<\/em><\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":" I\u2019ve been working with early stage companies and their intellectual property protection plans for years. But only recently did I read a clear document on the risks and rewards of patent strategy.\u00a0 Thanks to Russ Krajec, a patent attorney, for … Continue reading ![\"\"](\"https:\/\/berkonomics.com\/wp-content\/uploads\/2018\/11\/Patents-2.jpg\")
Then there are the claims that are the core of any patent.\u00a0 Most inventors want to explain the patent fully in its description, paying less attention to the claims.\u00a0 Here\u2019s another blockbusting piece of news. The description is not a legal part of the protection and could even be used to glean more information from you by a competitor than you ever intended.\u00a0 It is the individual claims that form the entire legal basis for protection.\u00a0 And claims must be written with precision, backed by significant research as to other patents which may come close but do not infringe upon each claim.\u00a0 As I have learned form one of my companies and its decade-long fight to enforce a single patent, one word can make the difference between ultimate acceptance by the examiner and then winning a patent infringement suit when that time comes.\u00a0 Whew.<\/p>\n