INTELLECTUAL PROPERTY
If a startup cannot protect its core technology and product concepts, the company may not be able to fend off competitors and profit from its investments.
Patents are designed to protect the composition or application of novel inventions and expire 20 years from the filing date. A patent prevents others from legally commercializing your invention, its derivatives, and downstream products without your permission, but the patent does not guarantee that you will have the freedom to sell or use your own invention. For example, you can patent a new type of capillary that accelerates the rate of capillary electrophoresis used in DNA sequencers. No one else will be able to make DNA sequencing equipment using these capillaries without your permission. However, you will never be able to manufacture or sell a complete DNA sequencer with your improvement unless you get permission from those people or companies who own patents for the other machine components. Without a licensing agreement, the owners of those patents may block you from commercializing your technology.
Key Questions
- Does the company have freedom-to-operate?
- How will the company prevent others from copying its product(s)?
- How long will the company enjoy IP protection? Is this long enough to generate adequate profits?
- If the patent position is weak, what other advantages does the company have over the competition?