Redeye VC: Depending on pending...(A VC's perspective on patents)

#1

Post by jkopelman » Fri, May 23, 2008, 3:36 PM UTC

Redeye VC: Depending on pending...(A VC's perspective on patents)
redeye.firstround.com

Re: Redeye VC: Depending on pending...(A VC's perspective on patents)

#2

Post by tptacek » Fri, May 23, 2008, 3:58 PM UTC

Even after your patent issues, enforcing it is horrifically expensive. In addition to the 7 year delay from filing to issuance, expect another 1-2 years, much of it billable, before a legal action based on your patent sees any action.

For a startup, is there any point in pursuing software patents at all?

Re: Redeye VC: Depending on pending...(A VC's perspective on patents)

#3

Post by gcv » Fri, May 23, 2008, 4:44 PM UTC

Fascinating. I keep hearing from a couple of people about how much effort, time, and money they are putting into their patent application process, fairly early on. One of them, a founder, supposedly has experience pitching to VCs, and claims that VCs always ask: "How is your product protected? What prevents others from copying your idea and outcompeting you?" He also claims the VCs expect to hear a simple answer "We have a dozen patents pending on our technology."

I wonder now if he doesn't know what he's talking about, or if the VCs writing these "build your product, don't worry so much about IP protection yet" are the cream of the crop who actually have a clue, but are completely out of reach for most (especially first-time) entrepreneurs.

Re: Redeye VC: Depending on pending...(A VC's perspective on patents)

#4

Post by nurall » Fri, May 23, 2008, 5:48 PM UTC

gcv wrote: post #3

Fascinating. I keep hearing from a couple of people about how much effort, time, and money they are putting into their patent application process, fairly early on. One of them, a founder, supposedly has experience pitching to VCs, and claims that VCs always ask: "How is your product protected? What prevents others from copying your idea and outcompeting you?" He also claims the VCs expect to hear a simple answer "We…

I think the author is talking about business method software patents. If the business method implementation needs patentable technology to implement, then it may not be such a bad idea.

But again I feel that for an early stage company, filing a patent just helps mitigate the risks in the VC's head more than anything else. Forget about enforcing your patent. If you are successful and you have a lot of money and you feel like bullying your competition, we all know how some successful companies go about it.

Re: Redeye VC: Depending on pending...(A VC's perspective on patents)

#5

Post by noonespecial » Fri, May 23, 2008, 8:13 PM UTC

Notice that Half.com had already been started, built up, and sold long before the patent was even granted! 5-7 Years? You could start half a dozen startups in that time.

File for the patents, but don't waste any time or money trying to make the filing "good". At best, patents pending are quaint old fairy-tales told about a bygone age to make investors feel all warm and fuzzy when you tuck them into bed.