I just attended a presentation at the MIT Entrepreneurship Center led by Al Burnett, the general council for Vecna Robotics. He had some interesting things to say about intellectual property (IP) and how it could be effectively used in very young companies.

The short of it: get some patents, and do it as cheaply as possible. Don’t worry too much about the quality of the patents, the claims, or the enforceability.

Why? Well, patents are only enforceable when they come along with litigation (read: very expensive.) If you are a young company, or a small company, you lose whenever litigation occurs. The solution, therefore, is to avoid litigation entirely.

In that sense, patents are not a protection against people trying to use your technology. They are actually protection against people trying to bring suits against you. And when it comes to law suits, patents beats no-patents.

This is how they work. If a company files a suit against you for infringement on one of their patents or technologies, there is a good change that they are a competitor of yours and they are fighting you because you are stealing their market share. A patent is something you can fire back with to say, “I’m not going to lay down and take it from you.” Patents are negotiating chips that you can use to protect yourself from underhanded attacks.

Patents have some other key benefits too: (1) They make your company look more attractive to potential acquirers. They indicate that you are serious, you’re technical, and you know what you’re talking about. (2) They make you look tough when you are being evaluated by competitors. In this sense, more patents are better. A single patent will make you look casual, but several will make you look like a real player.

The end result: get patents, but get them on the cheap. They need to be written well, but not that well. A big company can tear anything apart, so don’t invest in trying to make patents bullet proof. They won’t be.

Photo by Senator Mark Warner