Lately questions about Intellectual Property or IP have been cropping up left and right. Eliot Durbin (my partner at BOLDstart Ventures) and I had a long discussion this morning in preparation for his panel today about IP and patents. Last week, we met with a company and when we asked about their core IP, they launched into a 5 minute discussion about the various patents they filed. Do startups really think patents are going to make or break their business? Yes, having core tech or IP matters but patents are a different question altogether. Your best protection is continuing to focus on building your business, your product, and getting market share. So what is my and BOLDstart's stance on IP and startups.
1. We look at the team and the product and market first
2. We like to think that all of our investments have IP.
3. IP does not mean patent. IP in our mind is your "secret sauce" for doing what you do better, cheaper, and faster than anyone else. Its great if you filed for a patent but that is a long process taking 18-24 months and by the time you get a patent the market opportunity may have already passed you. Focus on building your product and market share, not on patents. That is your best protection and competitive advantage. Waiting for the patent office to tell you that you have a patent is a nice to have, not a must have.
4. Even if you have a patent, it takes tons of time and shitloads of dollars to defend. Trust me, I've been there, and it seems to me that the only person making money in these cases are lawyers. In addition when defending patents you will inevitably fight with the big boys with billion dollar balance sheets so that is not a place to spend your time and money.
5. Don't start a company where there is already a patent battle brewing like email on phones. We are looking for innovations, the next big thing, not yesterday's way of doing it.
Hopefully that gives you a good perspective on our view on IP, patents, and startups.
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