August 6, 2009
Recently I had an idea that seemed patentable. I’ve been through the patent process a few times, once successfully, but it has been a number of years. So I wondered what it would cost to run my new idea through the system.
What do you think it costs to use attorneys to work through the patent system and obtain patents for the U.S., Europe, and let’s say 16 more of the bigger countries?
Answer: Over $100K.
Sure, I could do the work myself, but who has that kind of time? And what are the chances that I could imitate the tortured language of a patent description well enough to make the patent office happy? Attempting that on my own seems like a big waste of time.
Worst of all, you have to wade into the process before knowing if anyone has already applied for the same patent. It takes about 3-4 years to get a patent, because the patent office is so backed up, and there is an 18-month opaque period in which you can’t view any ideas that are in the pipeline ahead of you. I went through this entire process once and in the end the patent office decided that someone else’s patent, that had no obvious correlation to my idea, was broad enough to include it.
So what would a small inventor with limited resources do in a situation like this? You could find an investor to go in with you, but I imagine the investor would take half, or more, of whatever the upside was. And where do you go to find such an investor anyway?
This made me wonder if some sort of investment market for patent ideas could be created. Suppose that after the inventor files a provisional application, which is the first part of the process, and not outrageously expensive, perhaps investors could have a chance to fund the rest of the patent process in return for some stake in the outcome.
As things stand, investors can’t view provisional patent applications. I assume there is a good reason for that. My guess is that it prevents claim jumpers from leaping into the patent process with a slightly better or broader version of your idea that you hadn’t described well enough in the provisional application. I’m not sure that’s a good enough reason to keep things secret. Perhaps inventors could have an option of remaining secret and funding things themselves or going public and attracting investors from an early stage.
This would serve as sort of a pre-patent filter for ideas. If an idea is patentable, but investors see little economic value in it, that’s good to know before you spend a bundle for a patent. And if investors see great potential, they would bid down the percent of equity they require in return for funding it. In other words, someone might be willing to fund a great patent idea for a 10% equity stake whereas a merely good idea might require 50%.
I’m sure there’s a problem with this scheme, or it is already being done in some fashion. Let me know.