New Evidence Shows That Patents Matter Less And Less For Startups
from the indeed dept
I was recently at a "tech" conference that focused on entrepreneurs, and I watched a panel discussion on "legal issues" where the first speaker went on at length about why startups absolutely needed to apply for patents as soon as possible. He argued that so much of a company's value was "tied up" in its "intellectual property" and you absolutely needed to "protect" it or the company could just be copied. This shows a fundamental misunderstanding of true value. The idea, by itself, is somewhat meaningless. The real issue is the execution -- and no matter what you know about the idea, the actual execution is always a lot more difficult. Focusing on "protecting" rather than executing can actually be the death of a startup.Thankfully, it looks like more and more startups in the "soft technology" realm are recognizing this, and are getting fewer and fewer patents. TechCrunch has a post by patent lawyer Leonid Kravets who did a study of patents and funded companies, and found that each year over the past few years, startups seem to be getting fewer patents.
![](https://i.imgur.com/7cZrm.png)
Filed Under: entrepreneurs, intellectual property, leonid kravets, venture capital
Companies: accel, facebook, foursquare, kickstarter, tumblr, twitter, union square
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Patents matter
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Re: Patents matter
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Re: Re: Patents matter
The protection angle flopped the moment patents started to be duplicated and thousands of patents for the same thing were granted.
Since you be sued anyways way incur the cost?
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Wrong reasons
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Re: Wrong reasons
If you are successful at anything, you are getting sued for IP violations. No amount of patenting "patently obvious" things will save you from that.
the best defense is clearly not a good offense. Several large companies used the defense line as a rallying point, and none have come to realize any fruits from that labor.
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Re: Re: Wrong reasons
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Re: Wrong reasons
Apple just was granted a patent on the concept of Google Glass as was Google, now imagine the two trying to sort this out in court.
http://www.wired.com/gadgetlab/2012/07/apple-patent-hud-display/
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False
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Re: False
It's also in the software industry, according to the article in Techcrunch, that patent use has fallen in startups. The Hardware industry is still applying for them like crazy.
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Patents suck..
Here is why I think they are awesome. NOT
Someone has an idea that is another idea but very much improved upon. USE YOUR PATENT TO CRUSH IT
You patent an idea you were never gonna use but it's obvious someone else would have a similar idea at one point or another. USE YOUR PATENT TO CRUSH IT OR SUE THE SHIT OUT OF IT
You want to troll a inventor?
MAKE A PATENT OF A GENERAL IDEA THAT COULD MEAN ALMOST ANYTHING AND SUE THE SHIT OUT OF IT
Yeah patents are awesome right?!
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Re: Patents suck..
In most european countries the damages you get from lawsuits are peanuts and it is making general license trolling hard to carry out profitably.
The only way to troll investors is through making a broad application patent and wait for someone to get trapped by it. You cannot really target anyone specifically with it.
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Only for Trolls
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Patents mean less to startups
OR, we can recognize the truth (anyone listening? Oh, I forgot, "Believe with your heart").
The truth is, if anyone cares, that the USPTO has bought into a "revenue vs performance" model - them that pays a lot gets a lot. So, small entities that file as small entities (or even if they file as large entities, and can't stand the expense of "continued prosecution") find that their inventions, no matter how novel, are rejected out-of-hand, and examiners that don't - get bad reviews and eventually are canned.
So, patenting has become an impossible dream for small entities. That gives the patent trolls and anticompetitive large entities the power they have always lusted after.
And, note: I am an IP (aka "patent") attorney.
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For one, it's expensive to get a patent. It takes a large amount of time, money, and effort to put it together, hire a lawyer, respond to the USPTO, research prior art, etc.
Second, you can't use it offensively. If someone steals your idea, what are you going to do? You can't sue, you have a small business with no capital to hire a lawyer for a protracted legal battle. Few small businesses can pay out a 6-7 figure legal bill when they're typically barely afloat. You can't really extort money patent troll like b/c everyone knows you don't have the cash to back up any threats.
Third, they're useless defensively. So you get sued by a competitor, do you have the capital to fight a 3 year legal battle over defending it and pressing claims against someone else?
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It's really hard to plan out IP protection strategy 4+ years in advance. For a small business/startup it's hard to even tell what you'll be doing in 4 years. For the 2 I've been involved in, their initial business plan and market focus changed substantially over the course of 2 years, let alone 4+.
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shaky
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Patents r important
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Patents suck for a number of reasons
Further, your goal when doing business should be to do what you do better than anyone else. If you do it right it translates into customer loyalty and goodwill.
You fight the competition by appealing more to your customers than the competition, not by stifling competition by restricting access to your industry by multiple patents.
Patents stifle innovation and are even non-evolutionary.
It only makes sense to have patents when you reach transformative scale and have so outpaced competition that their only ability to compete is to directly steal your innovation. But then again, if you were able to go that far you can probably keep steaming ahead without patents as your competitive advantage is your ability to invent and not your ability to protect.
Just look at the decline of Apple. In the wake of loosing Jobs, Tim hasn't really been able to Cook up anything new or groundbreaking. Patent litigation is not what made them successful, innovation was.
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