You have an idea. You think it could be big. Is it time to file a patent?
Jed Gordon, a seasoned intellectual property lawyer at JAB Law Group, shared his expertise with MFN on how founders can develop strong patent strategies for their startups. His insights reveal how patents can generate meaningful value — and how to avoid common but crippling mistakes.
The three most common patent strategies (and why they don’t work)
- The Moat: This strategy posits that if your idea is a castle, a patent is the moat surrounding your intellectual fortress. This common approach assumes that patents are comprehensive and impenetrable. It’s a nice idea, but in the modern market, it’s as effective as a fire-breathing dragon: fantastical and dangerous. Jed notes that no idea is an island. The patent you file — the moat you build — won’t cover every scenario, and expecting it to do so leaves you vulnerable to unwelcome competition.
- The Picket Fence: The second strategy involves assembling a portfolio of patents, each of which blocks a little bit of space similar to a picket. Individually, each patent offers little protection but can shield your business when aligned next to one another. Jed cautions that this strategy overlooks the truth each patent can contribute a tremendously different value, but the cost of each tends to be generally the same. Thus you end up paying substantial sums for some patents that do not add much value. In addition, not all pickets fit together — and, even with skilled carpentry, there will still be gaps. The Picket Fence strategy lacks the per-patent value assessment that a successful patent portfolio demands.
- The Estate: This strategy likens a patent to a real estate investment. However, just as your mortgage doesn’t encompass all property expenses, many first-time founders underestimate a patent’s comprehensive price. Whether renovation or repairs, property ownership requires constant maintenance and investment, as does patent prosecution enforcement. Be warned that the total cost of maintaining and enforcing your patent will far exceed projections. Your company may benefit more from a small well-landscaped parcel than paying for a costly, sprawling estate with fallow fields and unmined resources.
Jed recommends a more nuanced “choose-your-own-adventure” strategy that is guided by three essential questions: Why, How and When.
The Why: Why do I need a patent in the first place? In what way does it fit into my larger business strategy? What purpose does it serve?
These questions are an entry exam for Jed’s potential clients — and, in his mind, there is only one correct answer: a patent creates a competitive advantage that allows you to capture early market share. It’s not a certificate of legitimacy, it’s a business asset. With patent fees ranging anywhere from $1,000 to $100,000, make sure you file for the right reasons and be confident it justifies the costs.
The How: If you determine a patent is necessary, your next question is: How? If not a moat, a picket fence, or an estate, what should my strategy be?
“Think of the gold rush,” Jed suggests. Envision yourself as an intrepid explorer, and imagine that innovation is your path to the mother lode. Eventually, you hope to strike gold by finding a niche where your business will flourish. Patents, when used strategically, help delay competitors as you explore uncharted terrain. They force other travelers to seek their own path, instead of following your footprints in the mud.
But patents also make you visible. They mark your exact coordinates on the map. It’s critical, therefore, that you ensure you can enforce your patent before publishing it.
Jed’s advice? Only patent your Rocky Mountain moments. Scaling the Rockies takes more grit, risk, and precision than crossing the Great Plains. Don’t waste resources protecting your route if there are infinite viable strategies. Instead, prioritize significant, hard-to-replicate innovations and enjoy the epic summit views.
The When: When is the right time to patent? How can I tell if a patent will launch me forward or hold me back?
For this question, Jed again casts you as an explorer facing a formidable mountain range.
Perhaps you blast through the ridge with dynamite. If your idea is groundbreaking and explosive, it’s likely to be adopted and replicated quickly, so it’s important to secure intellectual property rights fast. As the patent holder, you have the option to drop a bar in front of the tunnel, or extract a toll from travelers passing through.
However, let’s say you discover a hidden mountain pass — narrow, unobtrusive, obscured by shrubbery and fallen rock. In this case, putting your trail on the map could actually make it easier for competitors to catch up with you, attracting attention to what otherwise may not have been found. In this case, skip the patent, keep your trail a trade secret, and force your fellow explorers to seek their own lucky paths.
Jed explains that deciding whether or not to patent comes down to how likely your innovation is to be independently discovered. Is it a blasted tunnel? Or a hidden pass? Crunch the numbers, weigh the risks, and make a choice. Sometimes the best patent strategy is not filing a patent at all.
