Feisal Mosleh

Feisal Mosleh

By Fas Mosleh on April 5, 2012 in his Blog – Feisal Mosleh New Ventures Partner at Juldee Innovation Ventures

Are you an entrepreneur in High tech? You may have a passion to launch a software startup or a new website or even a new kind of consumer electronic device like a video or camera phone.

Whatever your dream product, consider patenting any original, novel aspects by either filing a provisional or a full patent application at the US Patent Office. Why do this?

1) Using a Patent to Get Ahead in your Market

Well lets first consider what a patent provides you. A patent is an invention right that allows you as the inventor to actually freely use the invention you have created for the benefit of your business. But its more than that. A patent can be a strategic business tool that is used to prevent others including your competition from using your patented invention. This prevention could enable you to get ahead and stay ahead of your competition. Supposing your chief competitor starts to use your invention and you can prove this, then they can be stopped from proceeding further unless they 1) pay you some kind of licensing or royalty fee. or 2) develop a solution that does not utilize your invention – this could involve significant investments in time and money for the competitor, helping you, yet again steal a march on them or even directly benefit your income stream as a result.

2) Selling a Patent to Generate Revenues

The other way to get a benefit from having a patent is simply that the patent, once granted may have an intrinsic value to it. For instance if the patent describes a new kind of way of paying sales people commissions by doing calculations across the web and over the cloud, and this method starts to gain momentum and other companies start to use it, then your patent may have significant value to these companies. A patent may well sell for double or triple the amount invested in creating it. A famous multi-billion dollar sale of patents is Nortel.

3) Credibility

Ever noticed that “patent pending” label on some consumer product you are using (maybe a lubricant for your car, or a shampoo?). Why do manufacturers do this? Well, the third advantage of patenting your invention is the credibility it gives to you and your product. This might make your users or buyers look much more favorably upon your product.

4) Enhancing the Corporate Value

And, if you are seeking investment to fund your startup or even eventually selling your company as an exit strategy, having patents will be seen as a) providing a barrier to entry to competitors and b) increased marketability to customers and could  result in a higher valuation of your company either pre-funding or when its being acquired. One fairly large example of a corporation puffing up its value to a significant buyer is Motorola mobility, acquired by Google for $12.5B !

All in all, patents are a great investment for you and your company and product and if you have a novel invention and haven’t already patented it, I advise you to get cracking!

Fas Mosleh is SVP of IP transactions at Kanzatec IP Monetization, based in Silicon Valley at 650 468 0401.