So you have decided to start up a company in the green space. Is there any value in getting a patent?
As most reading this will be aware, a patent can help give you market exclusivity for your new product or process (providing there are no blocking patents). This enables you to have a huge competitive advantage, especially if your company does not have the resources yet to fend off competitors. A patent can also help you secure financing since investors want assurance that a large company cannot copy your brilliant invention. Not only that, obtaining a patent often provides a key metric by which others can determine the value of your technology. If your invention meets the hurdles of patentability, i.e., is both new and non-obvious over previous work, then this reflects well on the commercial potential of your invention. Of course, you can also mark your product “patented” or “patent pending”. This can further serve as an endorsement of the unique attributes of a new product.
One question that has been posed to me over the years is this: “If I don’t have the resources to enforce my patent, then why bother with getting a patent in the first instance?” This is a very good question, often asked by some of the more savvy inventors who might be skeptical of the value of patenting. One factor to consider is that even if you do not have the resources to monitor potential infringing activity, or the money to bring an infringement suit, a patent can be used as a “bargaining chip” in licensing negotiations. In other words, a patent serves as a sort of currency in the corporate ecosystem rather than cash itself. To illustrate, if a competitor holds a blocking patent you need to operate your business, then you can gain access to that patented technology by cross-licensing. This can be key to gaining entry to a market. If your patent is a game changer, then of course this will be reflected in its value in such transactions. For a start-up, this is especially important since so much of your company’s value is tied up in the new product or process you have to offer the world. Put another way, a patent is a way to solidify the value of that intangible asset.
So love it or hate it, a patent is necessary for your start-up to gain a foothold in the market and differentiate you from the rest of the pack.
So how do I go about getting a patent? That is the subject of the next blog.
Disclaimer: the views expressed herein are solely those of the author and do not reflect those of her past or present employers. Further, the above should not in any way be construed as legal advice. You will need to contact me for that (sorry).