The #1 BAD REASON why startups should file patents

I’m just preparing some presentation slides for a talk I will be giving tomorrow at the Center for Digital Technology and Management, a joint institution of the two universities we have here in Munich. The topic of my lecture will be “IP strategies for startups” — and a large part will be about patents, obviously.

And here’s one of the key messages of my lecture:

When you start a startup, people will tell you that you need to file patents for different reasons.

The #1 reason you will probably hear is that a patent allows you to force your competitors out of the market and make all the profit yourself.

From an academic point of view, this is absolutely true. A patent gives you the right to exclude others from making, selling and using the patented technology. It’s in fact the basic idea behind the whole patent game. The patent owner gets an exclusive right in return for disclosing the invention to the public.

But in my opinion reality tells another story. Filing patents for the sole reason of actively enforcing them is a terrible reason for startups, because it just doesn’t work. And this is why:

  1. Patents typically take 3–4 years to issue. So if you file your patent application today, in March 2017, chances are you will not be able to enforce the granted patent before 2020 — which is simply too late for your startup to make immediate use of it.
  2. The second reason is that even if you have patents, as an early stage startup you simply cannot afford enforcing them. This is because there is no patent police which hunts down the infringers for you, but you have to do it yourself. You have to track your competitors, you have to prove that they infringe, you have to tell them to stop, and if they don’t stop you have to bring a lawsuit — which involves a significant amount of money. Money which you simply don’t have as an early stage startup.

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By the way, check out my little Youtube channel for even more quick tips on European (software) patents!
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So what’s the point then? Why should startups file patents?

Rest assured, there are plenty of good reasons why startups should file patents. But let’s keep the excitement up a bit — I will tell you about the good reasons for filing patents as a startup in one of the next posts 😉

In the meantime, let’s get some discussion going: What’s your take on patents for startups? What are your pros and cons?

Let me know in the comments!


Originally published at www.europeansoftwarepatents.com on March 8, 2017.

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