Patents · Advisors

Should you have patents in order before talking to a advisor?

mark warren bcf at bcf

April 23rd, 2015

should your patents be in order before pitching idea to investors, talking with advisors?

Karl Schulmeisters Founder ExStreamVR

April 24th, 2015

Mark,  How much money do you have to defend your patent if Google infringes it?  Enough to hold off Google?  No?

Then a patent doesn't get you much other than a piece of paper that cost $10,000 of your scarce startup capital.  Go ahead and file the provisional patent, but it doesn't really matter much either except for giving you some patent troll protection.  OTOH it does also put you in the spotlight the patent trolls hunt in

Adrian Andrade Creative Director at emPower

April 23rd, 2015

Short answer: No. 

Long answer: If the hope of the patent is to protect your idea or to add value to it, you're barking up the wrong tree. Both scenarios are unlikely. Without knowing much about your product, if you absolutely have to file a patent, just file a provisional which locks in the date of submission (and cheap), but again, I think you're wasting your time. 

Fabio - No investor/advisor will ever sign an NDA/CDA before a pitch...

Tom Maiaroto Full Stack Consultant

April 23rd, 2015

Also keep in mind in the US, it changed to a first to file process. At least last I checked... So your provisional holds your spot in line... But no more prior art. If you file and someone else had the idea 5 years ago, but didn't file, you win. 

Patent system is pathetically broken for so many reasons and we haven't even gotten into the patent trolls subject yet.

Do be careful with patents. Seek legal advice.

David Crooke Serial entrepreneur and CTO

April 23rd, 2015

It's easy to get wrapped around the value and secrecy of one's idea .... don't sweat it, most investors are honest and frankly have better things to do than steal your idea and give it to someone else. That said, do use an NDA, that way you have legal leverage in the case that (a) they do steal it, and (b) it's successful. Then you can simply sue. Cheers Dave

Julien Fruchier Founder at Republic of Change

April 28th, 2015

Why are you asking? What are you trying to achieve? Is your idea software or hardware?   

Generally speaking, patents are not a smart investment for most startups. It's very expensive to file a truly defendable patent (if you file your own, you won't be taken very seriously by investors), and it's even more expensive to defend them. Unless you're a 7-figure funded startup with a big legal budget, I don't see how it's possible or logical. To that end, will investors take you seriously if you don't understand how patents work?

Thomas Sutrina Inventor at Retired Pursue Personal interrests and family

April 28th, 2015

Julien's comments above apply to most patent but not all.  The initial patent in an area even for a startup is important to have.  The first microwave, airplane, radio, cell phone, etc. are possible examples.   
Vanay also has an important point.  Your patent idea should be confidential, but to be afraid of sharing it then you will never obtain the help needed to move it forward.   A non-disclosure agreement is important to get if possible but it is a worthless piece of paper if the agreement is with a dishonest person and is not needed with a very honest person.
 Just think about the images of people put on the internet.  Yes you can bring charges against the person that steals or takes the image without permission, but you can not do a thing to the people that view it and do things to increase viewing. ( assume I have properly understood the TV attorneys discussing this issue)

Fabio Gratton Co-founder & CEO at CureClick, Sonic, inVibe, DrinkBryte & Alchemy

April 23rd, 2015

I don't think so -- of course, depends on your invention. You should have a CDA in place for sure.

# # #

Adrian: Not the case for many of the investors / advisors I have worked with. And I happily sign people's CDA's when they ask me to be an advisor. Nothing is absolute.

Tom Maiaroto Full Stack Consultant

April 23rd, 2015

Depends, but typically not a big need.

I used to feel more strongly about them, but when it comes to technology -- it's extremely difficult to defend them. The thing is, you need to actually defend them in order to hold their value. So it's not exactly like you get a patent and you're all good. You will need to, on occasion, shell out more money to defend the patent. Your milage will vary there of course.

The other thing with tech to realize is that you can often get the same end results using different methods so sometimes a patent doesn't necessarily protect your business. Sure, your invention is likely safe...But keep in mind your business model and value prop. Could it be copied or beaten through other means?

Timothy Clark Owner - Radiant Heart Studios

April 23rd, 2015

You can get a provisional patent around $200.  You then have a year (plus extensions) to decide whether you want to spend the money for a non-provisional patent ($10k-20k).  While you have the provisional patent you are somewhat protected. If someone else files for a patent, you have proof that you "thought of it first."  Knowing that you have a PP should discourage someone from trying to steal your invention.

Unfortunately, most investors and advisers won't sign Non Disclosure Agreements.  Many are even offended when you ask them.  I don't get it, but that seems to be the case more often than not.

Adrian Andrade Creative Director at emPower

April 23rd, 2015

Tim - Investors / Advisors don't sign NDAs because they often see many companies with similar products. As we know, they don't fund everyone that comes across their desk, so if they'd signed an NDA, they would potentially be sued by a company based on speculation that they provided information to a competitor even if that wasn't the case. They're simply protecting themselves from that scenario.