Yes – they certainly can be. I’ll stick to my area of expertise (startups & small businesses) regarding this topic though. Patents can and often do attract investors. They can also deter others with similar ideas. While patents can be valuable, they shouldn’t be the foundation of your startup, especially if you’re bootstrapped. In other words, your startup’s success shouldn’t depend on your patents, but they can certainly help.
There are more cost-friendly alternatives for startups that can actually provide significant intellectual property (IP) protection. In some instances, nondisclosure agreements, and trade secret protection can provide as robust of protect that costly patent registration provides. It’s important for all executives, employees, board members and advisors to be required to sign the agreements. You should also utilize IP assignment agreements. This type of contract obligates the pertinent individuals to assign all business-related IP to the company. You will also want to extend this IP protection through agreements with non-employees, including vendors, outsourced designers and engineers, consultants, and testing facilities.
That being said, patents can offer a startup many benefits, especially a tech company. In order to address the high costs, mounting litigation and general burdens associated with patent registration, Senators Patrick Leahy and Lamar Smith introduced a reform bill that was ultimately passed and signed into law in September 2012. The America Invents Act (AIA) is the single most key change to US Patent law in 60 years. The AIA is most relevant to high tech startups with potentially lucrative patents. Significantly, the law changed US patent rights from first-to-invent to first-to-file for applications filed on or after March 16, 2013. The new law also expanded the definition of “prior art,” which is immensely useful for first-to-file patent applicants. This law can be a game-changer for tech startups. Whether your IP assets are assets that should be protected with patent registration, or with other strategies, can best be determined with the assistance of an experienced IP attorney.
I encourage you to check outfor further guidance on how to determine the value of your IP. Also, please feel free to contact me directly with any concerns you have about registering your patent or protecting your IP in general. I hope that helps!