Let’s be boring, bland and of course stifle creativity in our efforts today.
I am of course speaking of the innately awful yet all too important world of patent law. Hopefully huge headaches and hard fought court calamities can be avoided in your innovative futures by simply snapping up some simplistic rules of law.
Of course all this comes with a massive disclaimer. I am no patent attorney. My thoughts are the mere ramblings of someone somewhat closely associated with the field of innovation. If you need real patent protection I am not the go to guy and you ought consider closely options of others around you.
What is a Patent and Why does it Matter?
In the most basic sense patents are protection. These pieces of paper granted by the Patent Office are purported saviors of startups and work to guard great ideas from cumbersome copycats. Unfortunately this outdated system often pierces the heart of innovation and prevents creativity from flourishing.
Patents do not prevent others from copying creative works as is commonly believed. Instead patents give the owner the ability to enforce. Find someone in violation of your invention and you can sue them into the Stone Age. That is of course if you can afford the attorney, legal fees and myriad of others costs associated with working the system.
See how the patent power quickly begins to erode when investigating the ideas themselves. Without the money to make your patent stand up in court you are screwed.
Types of Patents
There are two primary types of patents any inventor or designer in the US ought know before pursuing an endeavor.
Utility patents are the powerful force in defending functionality. These are your typical invention based patents and push the creativity and usage of the idea to the forefront. Whether a new method of creation, a simple solution to a problem or an awesome improvement upon an existing technology these are typical the types of patents to pursue and last twenty years.
Conversely designers in need of aesthetic and albeit less robust legal defense often look to the route of design patents in protecting innovation. A design patent is inherently less powerful a piece and generally ensures a certain style is not to be copied without consent. Imagine the looks of the latest fashion to understand these artistic barriers. Without the strength of functionality these mean little in terms of inventions and last 14 years.
Despite the dying system of innovation all is not lost for the little guy. Patents are particularly powerful in the hands of commandeering corporations. In this arena of mass megaliths these businesses wage war in courtrooms across the world in efforts to maximize profits. Patents provide a means of poisoning and pushing the competition and creating wicked wealth.
Average inventors can take this and play the powerful mercenary of company clashes.
Great ideas grant a swell of suitors. True innovation has companies clamoring to get a piece of the pie. This means you as the creator are entitled to some of the action.
Any aficionados of Shark Tank know this is almost always the approach purveyed by Kevin O’Leary(the Mr. Wonderful jerkoff). And while it seems dirty it is a powerful way to work creation into the world.
Licensing lessens almost the burdens of building a business and leverages existing company’s creative abilities to build, market and sell your innovation. Instead just cash the checks as they come in.
Here is a pretty extensive royalty rate table of what one may expect when licensing out technology.
Creative Company Valuations
Few entrepreneurs enter business planning to sell.
Despite this how many business builders eventually part ways with their creations? Whether out of boredom, a crunch for cash or merely a change of pace most entrepreneurs eventually sell their baby to a beautiful new buyer.
And in the area of company valuations, intellectual property is a powerful piece of the price tag. Buyers build buyouts on patents. This is the shield of safety corporations crave to create future focus on.
Unlike small startups these big boys value the protection provided and place a premium on patents.
If you ever have the notion of raising fund or wish to sell your startup down the road patents may be the prudent path to take. Without these assurances investors will likely quaff at your valuations and probably purchase for much reduced rates. It is less than ideal but planning exits allows you to understand possible positive actions to take in pushing the pace of your business.
Life without Patents
Patents provide a lovable level of protection for all able to enforce them. But in all likelihood in your bootstrapped business has much more important endeavors to focus upon. Intellectual property perhaps is not in the cards for your cash starved startup.
But do you need a patent to prosper? Interestingly enough in a study of innovation from 1977-2004 covering the winners of one publications R&D yearly top 100 awards found a mere 9% of the products were patented. This is extremely significant.
Rather than future fights and potential buyouts you are pushing forward for the one thing that all small businesses strive to create…a profit. Cash is king in the early days when so many sorry startups fail to flourish.
Because your baby needs fuel to flow patents may be outside the scope of your startup’s mission. There is nothing wrong with that. Damn near every business on Earth managed to make some money without any wildly inventive ideas or products. Patents aren’t the end all be all.
Branding is the big equalizer. Brands build a base of power no amount of copious copycats can defeat.
Look at Nike, Apple, Prada….All these great companies which dominate the dollars in our economy are the result of carefully crafted brands. We buy not just for the quality but also, more so for the brand identity. We buy into how others influence us.
That new pairs of shoes, a sexy purse or that brand new iPod aren’t merely items but extensions of ourselves. We are buying not mere goods but a better version of ourselves.
This is the power of business, the effect of branding and the wonderful way in which your company can compete with pointed patents.
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