Patents are an important part of the commercial value of a startup company. Patents offer value to a company because:
Consequently, it is worth considering what intellectual property your company has, how it can generate revenue and whether it needs to be protected through patents.
Note that sometimes a company’s products or technology cannot be protected through a patent. If this is the case, and the product is difficult to reproduce by others or can be obtained most economically from your company, you may still be able to market the product or technology to generate revenue. Nevertheless, angel investors or venture capital firms may be reluctant to invest in a company unless the intellectual property can be protected with patents.
An invention cannot be patented if it has already been publicly disclosed. There is a one-year grace period in Canada and the United States, but not in Europe. Public disclosure can include publication, seminar presentations, poster presentations and abstract submissions for conferences. Therefore, take care not to wait until after public disclosure, as the invention will then be non-patentable.
Another timing strategy is to delay public disclosure until there is sufficient information and finances to file a patent.
Start-up companies often do not have the financial resources to pursue a patent. Consider the following when deciding how to proceed:
Before starting a patent application, look for “prior art” using a patentability search. Prior art is any existing public description or related invention. The existence of prior art might not exclude you from patenting your invention, but it may narrow the scope of what parts or applications of your invention you can patent. This can help you avoid the unnecessary costs inherent in filing a patent application that is too broad or even unsuccessful.
A “freedom-to-operate” search is similar to a patentability search, but serves a different function. For example, your company may need to carry out a certain process or use a certain material. A freedom-to-operate search will discover whether that process or material is already patented. If it is, you may have to obtain an agreement with the patent holder in order to carry out your own business. Potential investors in your company will want to know that your company has done a freedom-to-operate search and secured any necessary agreements for your operation.
A patent must be obtained for each country or region in which protection is required. The most common jurisdictions to file a patent are the United States, Europe and Japan. Where to patent depends on where your market is, where your competitor’s market is, where you can enforce the patent and how many jurisdictions you can afford to file the patent in.
Once a patent application is made in one country, patent protection can generally be sought in other countries or jurisdictions within one year. Alternatively, although there is no such thing as an international patent, a Patent Cooperation Treaty (PCT) application can be filed. Once a PCT application is filed, national or regional patent applications can be made subsequently.
Canadian Intellectual Property Office. (2009, December 9.) Retrieved December 15, 2009 from http://www.cipo.ic.gc.ca/eic/site/cipointernet-internetopic.nsf/eng/Home
World Intellectual Property Organization. (n.d.) Retrieved December 15, 2009 from http://www.wipo.int/portal/index.html.en