Inventors that come up with good ideas often face the fear that they might lose that idea if they tell someone or if they do not protect it. At the same time, inventors need large companies to help them bring their ideas to market. But the process of securing a patent can often be a lengthy and expensive one. So, what can inventors do? A non-disclosure agreement (NDA) is not enough protection, while the cost of a lengthy and international patent application process is often too expensive and uncertain, without knowing whether the idea underlying the patent will be marketable.
In most cases the inventor wants to come up with his or her own business and tries to find external investors. But in order to do this effectively, they must rely on a proper business strategy and need patent protection as an integral component of that strategy. Patents protect your ideas from others selling competing products, which permits you to assess value for your invention. This value can often be used in discussions with corporate investors, who will want to know the market value of your invention before committing to an investment. Patents also protect inventors from large companies who possess many advantages in bringing ideas to market and who might try to compete with you. When patented, a product you might seek corporate investors for would be protected from counterfeiting by those investors, if cooperation failed, or others who might seek to copy it.
By creating a strategy that includes patent protection, you protect the potential market for your invention as well as protect yourself and your investors. This is not often done in Germany and France, especially by single inventors or small/medium-sized companies as many companies want to see the growing business first before making an investment.
Patents, once established, become assets which can be sold. The value of these patents permits inventors to, for example, secure loans or credit lines, as well as increase the price of your company, should you wish to sell it.
Inventors may wish to file the first patent application themselves – as a solution to the cost and time associated with initially utilizing a highly specialized patent law firm. The cost of filing yourself is not expensive, however subsequent filings would be. The first filing is comparatively inexpensive (as it can be done as a provisional filing without paying filing fees in most cases, e.g. a German national application without filing fees). Only the foreign and international subsequent filings covering multiple and/or different jurisdictions/countries are extremely expensive. But the “global-thinking big investor” wants to have global coverage.
The best approach is therefore that the inventor/startup files only the first filing as a preliminary filing with its own funds — and the plurality of subsequent foreign and international filings are then done by the buyer or at least paid by the investors. Here, the inventor must act very quickly, because the time between filing the provisional filing and the subsequent filing are only a few months (depending on the strategy).
After filing this first application, you may then contact investors who may be well placed to help fund your efforts and bring your invention to market. Importantly, you should do this quickly as companies who might invest are likely to lose interest quickly if you’ve not begun the process of protecting your invention – as they want to know they’ll be protected should they support you.
After filing this first application, you may then contact investors who may be well placed to help fund your efforts and bring your invention to market. Importantly, you should do this quickly as companies who might invest are likely to lose interest quickly if you’ve not begun the process of protecting your invention – as they want to know they’ll be protected should they support you.
Because patents are such a powerful tool providing inventors with many competitive advantages, it is important to utilize them in a strategic way to maximize your business objectives. By starting with small steps and utilizing lawyers later in the process, you’ll ensure you protect yourself from excessive up-front costs while maximizing your negotiating abilities with potential investors.
Sources:
https://ocpatentlawyer.com/patent-protection-benefits-every-inventor-consider-getting/
https://startupnation.com/manage-your-business/patent-new-invention/