July 10th, 2011 // 10:54 am @ mceja
DISCLAIMER: I am not a lawyer, I am an entrepreneur. As such, my decisions on how to investment money and time are governed by a risk-reward model. Thus, my personal philosophy on intellectual property (IP) differs from the average IP lawyer.
While there are exceptions to the rule, a typical lawyer will tell you a derivative of following: “Filing a patent is very important. You should do it immediately! You should also always file internationally.”
Their quick to file and ring up fees with out regard to the product brings to mind a quote from Shakespeare’s Henry VI, The first thing we do, let’s kill all the lawyers”. [Now do not send me angry emails, I have lots of friends who happen to be lawyers. I, unlike Shakespeare, believe that they do have a place in society. Just not exactly in business matters.]
While I do believe strong patents can be quite lucrative, I do think that one should always consider the cost and the potential return before blowing through your life savings. Here are a few things to consider:
- Patents can run you $10k and up, is your product worth it?
- Is this the best use of your money at this time, or should you be using it to further develop your product?
- Is it patentable? The Snuggie was not.
- Even if you do have a patentable product and someone infringes, do you have the resources to prosecute? (Think about how much money the Winklevoss twins outlayed in lawyer fees before getting a dime)
That said there are some great psychological advantages to filing a patent early if you have the resources:
- No matter how strong it is, a patent has a great psychological effect on raising capital. You can always use their money to improve it.
- A patent, even if poor has a tremendous psychological on effect on competitors. Competitors are likely to stay away long enough for you to make some serious money hire some “muscle” (aka team of lawyers) to keep your competitive advantage.
In life you will be faced with limited resources, whether its cash or time or both. The key is to what you need to do today, given your resources and information today to get you the next level.
As such, TCA has formed TCA & Friends and we have some great start-up lawyers that offer starting rates for our clients. That way you get best of both worlds. TCA advises you the best business decision and our partners review your legal docs. Win-Win-Win! Contact us to learn more.