6 Ways to Strengthen Your Patent Portfolio

6 Ways to Strengthen Your Patent Portfolio

The other day I was speaking to a portfolio manager at a large enterprise.  He was given a task to enhance the patent portfolio for the company. My first question to him was about the process of capturing ideas from inventors.

Me: “How do you capture the ideas and collaborate over the ideas to transform them into valuable IP?”

He: “We conduct certain brainstorming sessions, capture ideas in excel sheets and pursue as and when we feel a need for the same.”

In my experience of working for over 20 years with so many enterprises, the scenario is pretty much the same. Most enterprises use excel sheets, emails, docketing softwares (that’s like giving a factory when all that’s needed is a simple machine), or some other make-do softwares to capture ideas.

You might wonder what’s wrong with using such tools?

Well, in the absence of easy capturing and thorough vetting, a lot of things may happen which hurt the value of a patent portfolio.

  • Great ideas get lost while traveling amongst various stakeholders.
  • Weak ideas get pursued for filing a patent resulting in either a rejected patent or a low-value patent.
  • Filed/Granted patents are sometimes great in terms of innovation but do not have a market demand as the business team did not collaborate while persuasion.
  • Effort gets wasted on an idea which the company has already filed a patent on in the past by some other inventor.
  • Sometimes inventors get so busy with the progress of the invention that the idea gets completely missed out of the patenting process. Even worse, the product reaches the market without IP protection. And, competitors take full advantage of it.

Hence what’s needed is a defined process to capture ideas. A way to collaborate over ideas to conduct thorough internal vetting. A place where all the stakeholders from different arenas of a business and research can contribute. Thus making sure that only the finest ideas are pursued for filing patents. 

Besides this, a strong culture of innovation at the workplace and a time-to-time audit of the portfolio shall also be beneficial towards a valuable patent portfolio.

Here are 6 quick pointers that can help you strengthen your patent portfolio:

1./Effective Innovation Capturing

2. Thorough Vetting

3. Curating An Innovation Driven Culture

4. Getting Patent Experts Onboard

5. Pruning Patent Portfolio

6. Expediting Patenting Process

#1 Effective Innovation Capturing

It all starts with an idea. So, the inventor comes up with an idea. Maybe he shares the idea with you, maybe he does not. Maybe you review or maybe it gets slipped as you were too busy. And the inventor gets busy working on that idea totally forgetting about the protection it might need. Whether patent or trade secret or defensive publication. 

Now the product that gets created based on the inventor’s idea is revolutionary. And it reaches the public domain without any IP protection. It’s under the threat of fast followers. Companies out there who have resources and capital are always on a look for products which they can easily copy and sell for a lower cost. These guys also save on money that you spend on R&D and engineering of the product. Thus, grabbing the market share that your company deserved actually.

And the worst part is you cannot do anything about it. 

This necessitates to have a defined place to capture innovations and track their progress throughout the lifecycle.

Another thing that acts as a friction for inventors to disclose inventions and add them in the patent pipeline is: “long, non-intuitive invention disclosure forms with jargons that only attorneys understand”. At TriangleIP, we understand this friction and thus we have kept the idea capture form very simple in the TIP tool.  

#2 Thorough Vetting

If you have a bunch of ideas coming in from different inventors; it’s very much possible that you might not have a budget to pursue them all for IP protection. So in order to choose which ideas to pursue, the ideas need to get evaluated from different aspects. You might wish to keep some ideas as trade secrets or give some to public domain with patent protection. Hence what’s needed here is a thorough vetting of ideas.

Innovation happens quite early in a process. Typically before you have any customer or market validation. Hence all that can be done is speculation on which ideas will generate revenue a few years down the line. It takes around 3-5 years to get patent protection for an invention.

However, one thing that helps you mitigate the risk and choose the best of ideas is to have it vetted by people from different streams; business, legal, engineering, strategy, etc.

Listed below are some important factors to consider to zero down on the ideas for patenting:

  • Strategic vision of the enterprise.
    • Alignment with a product line to have market dominance. 
      • Say there is a company that deals in smart refrigerators. It would want to have patents around advanced functions of refrigerator like: Ordering groceries based on the supplements about to finish in the refrigerator.
    • Market expansion across geographies.
    • Just for defensive purposes against probable lawsuits.
  • Relevance of technology to be patented in long term. Technologies go out of date as industries evolve. 
    • Example: Mobile phones have almost out-dated the landline phones in the last few years.  
  • Budget allocated towards IP.

#3 Curating An Innovation-Driven Work Culture.

“When failure is not an option, we can forget about creativity, learning and innovation. – Brene Brown”

Embracing failure is the key to have an innovation driven culture. Because the studies suggest that a significant percentage of innovations fail. The companies must have enough risk appetite (financially) to handle the failures. (Because somewhere there are chances of blockbuster success too).

And that’s not all, there are many other factors that can encourage or kill innovation culture at an enterprise.

The other day I was reading a book called “The Invincible Company” and in that, I came across a beautiful concept called “The Culture Map”. The culture map talked about the Enablers and Blockers of innovation at a company. It resonated really well with me. 

Innovation Culture Blockers:

  1. Lack of Innovation Strategy.
  2. General Fear of Failure.
  3. Bureaucracy slowing down innovation.
  4. Locked into Current Business Model.
  5. Lack of skills, knowledge and experience.

Innovation Culture Enablers

  1. Strategic guidance.
  2. Resource allocation.
  3. Innovation Tools.
  4. Legitimacy and Power.
  5. Skills development.

It would be beneficial to take a quick look inside your organization for these enablers and blockers. This shall further be helpful in creating an environment where innovation shall flourish for the organizational good.

#4 Getting Patent Experts Onboard:

Lack of expertise in drafting patents may result in rejection. Mentioned below are some of the top reasons for rejection of patent applications:

  • Improper and Insufficient description of the invention and how it works.
  • Lack of novelty.
  • Non-patentable subject matter; e.g. new use of a known substance.
  • Erroneous Writing: Issues with line numbers, reference numbers on drawings, or paragraph numbers.

If you don’t have in-house experts to write the patent, we suggest that you choose an IP firm that has the reputation and the experience to handle the end-to-end process. You need to have the right people on the job to draft the patent. Ensure that the one who is writing the patent has deep knowledge of the technology, has the right background, understands the fundamentals of a patent, and so on. 

#5 Pruning Patent Portfolio | Abandoning ‘Out-of-Date’ Patents

Let’s say you have a portfolio of many patents (50 or more), only a few of them would be worth a lot. The rest will guzzle your time, effort and money.

Maintenance fee alone can become a significant expense if there are many patents in a portfolio and for quite a long time. The snapshot below  shows the maintenance fee to be paid for patents at different time intervals.

The ability to know when to stop investing in bad IP assets is important to have a strong patent portfolio.

If you look carefully in your portfolio, you will find that there are patents that are areas in orphaned technology or where there is no commercial interest. Free up the budget allocated for it to work on an innovation that is more promising. A technology that was once highly used does not mean it is going to be relevant forever. Some of the patents might have run their utility. 

Let’s take a look at how IBM has pruned it’s patent portfolio over the last 2 decades. IBM has abandoned thousands of patents across T0, T1 and T2. This probably saved them millions of dollars and strengthened the patent portfolio.

There can be many reasons for abandoning the patents:

We, at Triangle IP, are on the way to bring analytics to the TIP tool  that shall help the users identify hopelessly expensive cases.

  • Out-of-date technology as the industry evolved over the years.
  • Change in patent laws in different geographies.
  • No market presence, say you got patents in the UK but the business related to those patents never really took off in the UK. So, maintaining those patents does not make sense.

#6 Expediting the patenting process to be at the right time in the market.

There was a time when it took more than three to five years to get your patent up and running. Thankfully, that’s not the case anymore as you can easily get an expedited patent for a few thousand dollars in the US. While it might sound like a big number for a new startup, if it means that you can build your portfolio quicker, then it is wise to get that leverage for yourself. 

You can also watch this video by our co-founder where he explain portfolio management in a greater detail:

To Sum It Up:

Here is a quick recap of the pointers that shall help you progress towards a strong patent portfolio.

1..A well-defined business process to capture ideas and progress them to valuable IP (Intellectual Property). 

2. The process must provide for thorough vetting from strategy, market, legal, feasibility, financial aspects.

3. Curating an innovation culture by removing the blockers and supporting the enablers shall help your people to come up with more valuable inventions.

4. Ensure that your patent applications do not fall in the rejection bucket by hiring experts to write your patent applications.

5. Time-to-time pruning of the patent portfolio i.e. abandoning the patents (due for renewal) can help you strengthen the patent portfolio.

6. Expediting the patenting process for a few thousand dollars shall be a good tradeoff to be at the right place at the right time.

3 Ingredients of High-Quality Patent Application

Understanding and decoding a patent can feel like reading a foreign language. Patent claims are littered with legalese and hard to parse. We might rely on recommendations or go to an established firm to get a patent drafted. Sometimes, the tendency is also to get it done as inexpensively as possible.

However, when you can’t judge the quality, then you can’t make a sure decision. So, differentiating a good quality patent from a not so good quality patent may seem like a daunting task. But it doesn’t have to be. Here are a few tips and tricks that make this easy.

There are three ingredients of a high-quality patent application you must look for:

1. Substantive coverage

2. Simple language without ambiguity

3. Technical details: Visuals, Citations, and References

Substantive Coverage

Contrary to popular belief, in a patent application, less is not more. A detailed description of the invention along with alternative solutions is essential to ensure broad coverage. 

Good patents tend not to be short. A short patent may have 4-5 figures and are very high level. They have very little detail in them. A really good patent would have about 10-15 figures correspondingly with detail that can be added to the claims if needed. Hence, when you get a draft back, check whether it is 3 pages long or 15 pages long. Generally, the more said about the innovation, the more likely you are going to get a better coverage.  Description of alternative solutions to the underlying problem will allow claiming those later as your competition tries to design around your roadblocks.

Claims are a very important part of a patent application. It’s quite debatable on what the claims should look like. A long book could be written on the topic and still would not make things easier. As a broad rule a high-quality patent application must have claims directed to how your innovation uniquely solves the underlying problem that originally motivated the invention. Dependent claims can add details as possible fallback positions. 

However there are few red flags you can look for while evaluating the claims:

  • Claims should be written in such a way that others cannot design around that would create legal gaps.
  • Too narrow claims reduce infringement opportunities, but if they are too broad it is unlikely that they would be allowed.
  • Technology covered in claims must be relevant 10-15 years down the line as the industry evolves.

Let’s take a look at the claims of this high-quality  patent application on “Techniques in Transit Advertising” for example. It has 3 independent and 13 dependent claims with 26 figures.

In summary the patent is for a method to generate a request for an advertisement based on an identified ridership pattern of a user of a transit system:

Let’s take a look at claims.

The illustration above is from the patent AU2013262776B2 picked up using Google Patents Database.

Let’s take a look at the coverage of this claim:

  1. The claim talks about retrieving information to find the advertising preference for the rider of the transit system to tailor the experience.
  2. It also talks about the kind of information that shall be retrieved: entry point, exit point, duration of transit, time and location of plurality of such transactions so that the advertising is location relevant.
  3. The claim also covers the places for displaying the advertisement like faregates, kiosks, countertops, etc. for the rider.

Going through the complete claims set of this patent, gives a good idea of what claims should look like. The other claims cover a lot of possibilities around the invention like merchant proximity, information that can be displayed other than advertisements, type of media (machine readable) etc. to provide further detail and fallback positions.

The Heart Of The Invention

Once you have a draft patent application, the inventor(s) should read it critically. Has the draft properly detailed the heart of the invention (i.e., the key differentiator that enables your invention). Is the heart of the invention only mentioned in a cursory manner? Or, is it filled with creative detail and alternatives? Reading of the draft should surprise the inventor with its thoroughness and detail. This goes to show how much thinking has gone into describing the invention. Remember, the patent application is not a marketing tool. It doesn’t need to be flashy with marketing language. The purpose of a patent application is to get the patent granted. And for that, the application must be detailed and thorough. Failure to disclose the details of the invention amounts to a failure to describe how the inventor was in the possession of the claimed invention.

The patent office requires the inner workings and technical detail on how the heart or the core of the invention works.  It should provide the detail to allow another to make and use the invention.  The drafter should go in much deeper detail even if the product has not been built.

You should see that detail in the draft.

Think about what the most important technological thing is. For one, it should be captured in the claim. Because it is hard to parse the claims, ask the drafter, where it is mentioned in the claims. Then work your way back and see how much writing is there about that. A good patent application should have at least 2-3 pages of the core of the invention i.e. selling point of the innovation. 

Scope of Application

Does the draft speak to what is unique about that invention and define its scope too?

In addition to the uniqueness of the invention, the application must also have a wide scope to enable others to understand how it might be built. Ensure that it covers the existing and future scope of innovation as far out into the future as you might imagine. 

Simple Language

High-quality patent specifications are written in unambiguous language to be easily understood. The simple language also ensures that the ideas are not lost in translation.

This means the application must read like something familiar to you or any other similarly trained engineer, developer or scientist. If vague or confusing, it leads to potential attack down the road. If only the claims could be written to avoid the legalese, but the precision of their meaning requires the use of language that the courts have defined in their legal decisions.

Technical Details

A long, thoroughly drafted specification with thorough technical detail must have 

  • Block Diagrams
  • Citations
  • References

Block Diagrams

The visual impact of an application is almost as important as the written word. Make sure that the application includes pictographic representations of the invention – block diagrams, mechanical drawings, graphs, screenshots, etc.

Like ample description, the visuals should portray the innovation from different perspectives. For example the block diagram shown below is from a patent on “Techniques in Transit Advertising” (We have used the same patent as a reference throughout the post for easier understanding :)). The patent has 26 figures – a sign of high-quality patent application.

The illustration above is from the patent AU2013262776B2 picked up using Google Patents Database.

Citations

A citation is a reference to prior art that is considered relevant to a current patent application. 

There are two different types of citations 

Backward Citations

Backward citations are patents that are cited by a specific patent and forward citations are patents that cite a specific patent. In other words, these are earlier published documents that are publicly available before the filing date of a new patent application/prior art. 

Forward Citations

A good application must find and cite documents that 

  1. may anticipate the claimed invention, 
  2. or might be similar to the claimed invention and limit the scope of the patent protection, 
  3. or which generally reveal the state of the art of the technology.

These are forward citations. The number of forward citations a patent receives is often used as a measure of a patent’s significance.

The use of citations in a patent application shows the thoroughness of research. These can also act as markers to detail the scope of the invention. 

References 

A patent includes citations to other patents and literature that the examiner may find relevant to patentability (i.e., prior art). Adding references to the patent application makes it easier for the examiner to evaluate the same and indicates sophistication by the filer and generally indicates searching may have guided the draft.

They also add weight and credibility to the application, thereby increasing the chances of a grant.  The examiner will also search for references.  All the references will appear on the face of the patent application and more is better.

A good search prior to drafting helps define the novelty in the context of what others have done.  Claims should be drafted to broadly cover the innovation, but not step too far into the prior art.  Especially where your drafter may be unfamiliar with your technology, a good search can help familiarise them.

Tools To Evaluate Patent Quality

You might consider using a tool to evaluate patent quality. That is not a bad idea, but it has a downside. Let’s see how.

The quality of a patent is defined by the objective as well as subjective factors.

Objective factors are the ones that can be computed or measured by software. These include

  • Length of Specification
  • Number of claims
  • The number of words in the independent claims

Subjective factors are more traditional like:

  • Scope of the application
  • A correct and complete description of the heart of the innovation
  • How important innovation is to your business?

The tools available in the market can help you judge the quality of a patent defined by objective factors. These objective factors can be easily manipulated too. In fact, experienced and expert drafters can remarkably improve the quality of a patent. But for the subjective factors, human feedback is necessary.

In case you want to watch more about filing high quality patents, I suggest watching below video:

 

A Quick Recap

With this post we have tried to equip you with the ability to differentiate between a low and a high-quality patent application. To summarize presented below is a 7-points checklist for high-quality patent applications.

  1. High-quality patent specifications are written in unambiguous language to ensure that the ideas are not lost in translation.
  2. Claims should be directed to how your innovation uniquely solves the underlying problem that originally motivated the invention. Dependent claims can add details as possible fallback positions. 
  3. A high-quality patent application should have at least 2-3 pages of the core of the invention i.e. selling point of the innovation. Failure to disclose the details of the invention amounts to a failure to describe how the inventor was in the possession of the claimed invention.
  4. Make sure that the application includes pictographic representations of the invention – block diagrams, mechanical drawings, graphs, screenshots, etc. Like ample description, the visuals should portray the innovation from different perspectives.
  5. Numerous references in a  patent application make it easier for the examiner to evaluate the same and indicate sophistication by the filer. They also add weight and credibility to the application, thereby increasing the chances of a grant.
  6. A high-quality patent application covers the existing and future scope of innovation as far out into the future as you might imagine.
  7. The use of citations in a patent application shows the thoroughness of research. These can also act as markers to detail the scope of the invention. 

A well-drafted patent application, as expensive as it may be, is one of your best business investments. To ensure a high-quality patent application, hire the best. Read and re-read, keep editing, and amending and make the application thorough. In exchange for a limited monopoly, description and enablement are the “consideration” that you must provide to the public. 

To make the patent application even stronger, ask the following questions:

  1. Can this patent be adapted to the jurisdictions you would like to take it to in the future? Gain some insights here on the global patent portfolio strategy.
  2. How easy or difficult does the application make it to detect or prove infringement based on public information?
  3. Will competitors be able to understand the relevance of the patent?

Let’s keep that discussion for another day!

Wondering if your IP strategy is strong or not; read this “Is My IP Strategy Headed In Right Direction”!

How Do I Know If My Company Needs A Global Patent Portfolio Strategy?

WHEN IS THE RIGHT TIME TO THINK ABOUT GLOBAL PATENT PORTFOLIO STRATEGY

Filing patents is an expensive affair. Let’s say, you wish to get patent protection on your product in China. It shall cost you somewhere between 20000 to 50000 USD. This cost involves not just filing but also patent attorney expenses, professional drawing expenses, patent office expenses, government taxes, etc. If you see a market demand and plan to expand your product line in China, keeping in mind the potential of money you can make, it completely makes sense to make this IP investment. Otherwise, spending so much money without significant returns is going to hurt you.

Here is how you can create a global patent portfolio strategy without breaking your bank: 

Market Expansion in Different Geographies

Why do you need to file patents outside the country? The answer to this is simple:  you may be making profits in those areas. Your product may have a market outside the country and you plan to expand in those markets.

If you own the IP rights for a product only in the US, you can not stop anyone else in the rest of the world from making that product. You need to apply for patents in each country. Multi-country protection is possible in places like Europe, Africa and Russia.

But, do you need IP protection in each of the 195 countries in the world? 

No, there is no need to protect your IP in countries that might not have potential customers. 

Credits: Pexels

Patenting Costs Vs Profits

Before you make a decision, it would be great to do little math because the different costs involved in patent protection add up real quick and the sums become humongous. To give you a quick idea, in the US, the costs for filing a utility patent ranges anywhere between $8,000 and $15,000. Under the Euro-Patent Cooperation Treaty (PCT), the cost of filing a patent is 47,000 Euros and it is valid in eight European countries. In India, the cost of drafting a patent application costs anywhere from $350 and above. You can know more about patent filing costs in more countries by using this link here. The more countries you look for protection in, the costlier it gets. 

Unless these costs can be covered up with the huge market potential in those countries, you should think hard before spending money in procuring patent protection there. If you think that stopping your competitors from being able to sell a similar product will add to your bottom line, then do go ahead with protecting your IP. The question to ask yourself is would you be able to recoup the money and make a profit if you sell in this market?

Look to see where you are going to make money and how the market is going to evolve over the term of the patent. The market landscape keeps changing. Although a patent protects you for 20 years, things keep evolving much more rapidly. You need to have a pulse of where the market is heading, the costs associated with IP protection, and your own objectives.

Studying Competitor Markets

Apart from having a patent in the country that you operate, you should also identify what your competitors are up to. A local competitor might be making huge money by selling a product like yours in another country. But you cannot stop them as you do not have any IP protection in that country. You need to protect your IP assets in that country to either stop them or license your technology. 

For example, you have a patent in the United States and you are only doing business there, but your competitor makes most of their money in Mexico. Picking up a patent battle with them in the United States may not be harmful to them, hence you would want to expand in Mexico and assert your patent there.

Does this make you worried about the IP expenses in various countries? Here’s the good news: you don’t have to protect your IP in all the countries in the world. That would be a frivolous waste of money, time, and resources. All you need to do is ‘make it painful enough so that the competition doesn’t want to introduce a competing product.’ Identify the key markets and lock these markets. The following section tells you how.

Lock key markets (Rule of Thumb)

Sometimes the thing to consider is that you get a broader protection in the countries you file in. For example you have a big patent portfolio in the United States. The likelihood that a competitor can launch a really similar product and sell only in Canada (which has only 1/6th of the population of the United States) is very less as some of the products require a lot of investment before you can make money in a country. Hence, the economics of protecting the market and building the market may not be there in Canada. So if some of the profits can not spill to the United States, it would be very difficult to build out the North America market. Thus, the United States becomes one of the key markets.

Similarly, there are key markets in Europe such as France, Germany and the UK. Once you get a protection in these countries, there is very less likelihood that a competitor is going to release a product in the other smaller jurisdictions such as Monaco, Liechtenstein. Hence, you don’t need to file in all jurisdictions. All you need to do is ‘make it painful enough so that the competition doesn’t want to introduce a competing product.’ 

For example, you have a strong patent portfolio built out in Germany. Because in Europe, the borders are very porous and Germany is a big market, any patent asserted in Germany is going to be very painful to your competitor, who might have wanted to sell a similar product. Most of the retailers, and sales channels are all across Europe, and a lot of retailers would not want to sell a product only in one part of Europe and not in the other (as it makes the logistics very difficult). Hence, if you are asserting a patent in one of the key markets in Europe, which is Germany, the competition may have to shut doors to all of Europe. 

While a world-dominion for your IP protection might sound fancy, it will certainly not be the smartest move in your playbook. Here’s what we would suggest to you: Pick key markets which will lock up at least 60% of the future revenues for the product as inexpensively as possible. 

Let’s say you are in the electronics and software space, just by protecting your IP in Europe, USA, and a few Asian countries, such as China, you can lock up most of the market for many products. Getting coverage in these jurisdictions will cost you roughly $100,000. (Disclaimer: The rates of getting your IP protected also depends on the kind of patent. The $100,000 number is approximate for basic IP protection.) By protecting your product in these markets, you leave your competitor high and dry as they are forced to compete in secondary markets. Would that even be worthwhile for them? Chances are high that they may end up focusing on a different product which will make financial sense for them. 

While some companies might look at rich markets, there are industries where a huge population is appealing when they sell low-cost items. Drug manufacturers might prefer to go by headcount when it comes to deciding the countries that can be a part of the 60%. 

Hence, figure out what the revenue model for your product is, identify the key markets and lock 60% of your market as inexpensively as possible.

Conclusion

Protecting your IP can be a tricky business in itself. Coming up with a strategy to protect it from competitors in countries where your IP is not protected deserves a lot of your time and effort. Having the right strategy in place with an IP Consulting firm can save your firm big money. Hire an experienced IP attorney to help create a global patent portfolio strategy.

5 Legal Tech Innovations To Empower Patent Attorneys

5 Legal Tech Innovations to Empower Patent Attorney

Today I wish to share with you guys an interesting instance that happened with me last week. One of us was sneezing non-stop & it was a weekday. You can imagine how difficult it is to squeeze out time on a weekday for a doctor’s visit. The long queues and fear of catching the coronavirus at the doctor’s clinic. 

So, instead of going physically to a clinic, we tried something new. We consulted the doctor over a video call using a mobile app. And received the medication within 3 hours of the call. It took us just a few minutes to connect and speak to a doctor. It saved us 2 hours of the day which we would have otherwise spent on visiting a clinic. Thanks to digitization!

PC: Vecteezy

Digitization is happening everywhere be it education domain or medical. And Covid-19 has acted as a strong catalyst to fuel it all up. This made me curious to know how digitization is transforming the legal domain. And my search began. 

I started looking for innovations in the IP domain leveraging digitisation. While searching I stumbled upon a podcast channel -“Technically Legal”. The channel talks about innovations aimed to empower IP attorneys. I found exactly what I was looking for.  

Technically Legal” is a podcast channel hosted by Chad Main that revolves around tech innovations in the legal field. Chad has worked as a litigator and is now a founder of a legal tech services company.

I found a lot of interesting innovations spoken about in different episodes on the channel. Most of the innovations are targeted to automate mundane stuff that eats up a lot of time of legal professionals. Some innovations are based on AI (Artificial Intelligence) while some leverage VR (Virtual Reality). I believe that with innovations like these, the legal professionals can truly benefit & save time to pursue “real legal work”.

I was also hoping to find something that strengthens the patent mining process  at an organization. After all, we belong to an industry that’s centric to innovations. Innovation capture is the first step to patent mining which inturn brings a competitive edge to enterprises. Based on years of experience in the IP domain we felt a lack of business process that supports the complete workflow from ideas to patents. And that led the conception of a tool that specifically caters to capturing and collaborating over innovations.

This post speaks about 5 of my favourite innovations from different episodes of the podcast. Hope with this post, you’ll be able to make the much needed next move in digitisation.

PC: Vecteezy

LegalMation | AI-Powered Automation Of Routine Litigation Tasks

The legal professionals lose a lot of time in certain mundane routine litigation tasks but with the advancement of technology, here is a time saviour on their way. LegalMation, an AI powered tool, automates document creation, promotes consistency and conserves the use of resources. 

LegalMation automates a lot of repetitive drafting of standard documents along the spectrum of litigation tasks such as:

  • Discovery responses,
  • RFPs (Request for Proposal),
  • RFAs (Regular First Appeal), 
  • Pleadings.

With technologies like LegalMation, AI is bound to change the face of the legal industry. However, AI is not ready to perform a task without spoon-feeding it the details. The samples or specimens ought to be put by way of a supervisory process as it never forgets what you feed it. 

For example, at LegalMation, it took the AI tool about six months to understand and prepare suitable results for employment discrimination. 

One thing is set in stone that AI can never be an attorney’s replacement, and only be a compliment to attorneys. If you feed the AI with the correct and requisite information, then as the founder of LegalMation says “it will make attorneys do the ‘real legal work’ and not the routine or grunt work”.

Several law firms are using LegalMation for handling high stake litigation and also coming at par with the bigger law firms by leveraging automation to save time and conserve resources. 

CRM & Chatbots | Automation to Improve Client Communication

“Attorneys fail to respond to more than 60% of inquiries from prospective clients.” –  Clio’s Legal Trends Report.

60% sounds staggering. But, it can be brought down!

In this episode from the ”Technically Legal” podcast it was interesting to hear from Gyi Tsakalakis, founder of Attorney Sync,  on how certain parts of client communications can be automated to reduce this number.

Email automation or auto-responses can be set if the majority of your work is taking place on emails. Autoresponders help to set the client’s expectations for a follow-up. The automation tool has been designed for nurturing a client. 

For some of the common questions like fee structure or kinds of services available, a virtual assistant may be placed by the firm. A firm can add questions and answers to the hotline or virtual assistant and it further grasps the method on how to answer the queries. 

PC: Vecteezy

Using technology to improve responsiveness and strengthening client relationships ought to be at the forefront of legal professionals as it is often said that “old clients are untapped resources and they generate the majority of the work as compared to the new clients”. 

Client Relationship Management (CRM) tools are user friendly and are very well appreciated in maintaining relationships with clients by enabling the legal professionals to be more responsive to client queries, winning new business, tracking and answering calls, etc. 

CRM also takes potential client queries by way of preparing client lists, tracking leads, and managing the schedule.

PacerPro | Automating The Distribution & Data Capture From Federal Court Filings

An attorney always runs after saving time as doing that would provide him with an extra period of time to spend on “real legal work”.  

For example, somebody on the team receives notice for filing from the court via email. Afterward, everybody will download the document to see the court order, and doing this will take 6-7 minutes of everybody’s time. From the record department, paralegals, attorneys, to junior associates on the team, everybody will download the document and follow the process to label the pdf file and further, distributing it to the team on the case. This takes up everybody’s time in question which can be potentially saved.

Pacer Pro Manifold - Streamlined case management and automated data capture

To solve the above problem, Pacerpro is an application that streamlines and automates the distribution and captures data from the federal court website. 

Pacerpro does a one-time backend setup wherein the application adds the software’s email address to the attorney Electronic Court filing (ECF) profile and then on a going-forward basis, the attorney or legal associate will automatically receive the email after 1-2 minutes of the court notice that has the labeled pdf attached. 

Further on, the staff associate or the junior associate on the case can easily distribute the court order among the legal team in real-time. By way of this application, everyone will save time and distribute the court order to everybody on the team without them downloading the court order individually. 

The Pacerpro founders conducted a study on several law firms wherein they found out that automating the distribution and processing of federal court filings saved nearly 50,000 hours of human time.

Slack | Automating Legal Workflows And (Not) Using Email

Another problem which attorneys often face is the exchange of a plethora of emails and the availability of the staff or clients to receive emails. There is a lot of hassle in back and forth email conversations and keeping all data in one email trail mail. 

To counter this problem, many firms and organizations have started using Slack as a platform for their virtual workspace or to keep the entire work product in one place. The productivity and effectiveness of the legal team have also increased. 

Slack as a platform is not limited to being a communication hub. It possesses features such as workflows and bots which the legal departments can use to automate common legal tasks. 

Slack workflows are majorly utilized for answering field questions, review documents and agreements as well as to close sales deals. 

Slack is known as the email killer or replacement for email. There are multiple channels for different work or teams. One can easily put the information, announcement, or any other important document for everybody to read on a multi-party channel. It gets rid of the traditional way of sending emails to everybody individually to send one particular message or announcement. 

Channels are defined as building blocks of work. Different channels will have different people in them and they can view the whole inbox trail. If a new person gets added to the channel, then they can easily view the previous conversation by way of the archive on the said channel. 

One can also connect with external stakeholders on Slack. The Platform also provides the option of creating public/private channels wherein anyone can enter or get added on a public channel but there are private channels available for one particular team or for the client for maintaining attorney-client communication by the Attorney. Nobody has access to the conversations on the Private Channel. 

You may easily turn off the notifications on weekends or as and when you please. You can also correct typos or other information as there is an option of editing a message on Slack. Whereas you need to double or triple check the content you type in the email body because you cannot retract the Email or edit the typos if you have any. 

ESI | Virtual Reality As An Aid in Patent Cases

Litigation in high stakes cases often lacks scientific accuracy.

To resolve the problem of lack of scientific accuracy in complex legal cases, one Virtual Reality (VR) technology by Engineering Systems Inc. (ESI) has emerged which tends to help jurors clearly understand what happened in a case and under what circumstances.

PC: Vecteezy

Virtual Reality is a technology that can aid in patent cases, tort cases as well as in personal injury cases. The court of law and legal practitioners appreciate the visualizations and demonstrations which help the case reach its verdict faster. 

For example, in patent law, courts are facing a surge in the amount of litigation over patents that only exist by way of prototypes. VR patents help those patents come to existence by utilising the patent specifications and claims. Afterward, they are presented before the courts as evidence which help reach the verdict faster and in a more effective way. 

VR technology is very accurate in capturing measurements or dimensions through the process of laser scanning. 

In a few cases, drones are also used to capture imagery and model the property virtually to eliminate the list of events that cannot occur and figure out events that may have occurred.

The creation of 3D models and virtual reality applications help attorneys to better argue their case after understanding the case in depth. The technology also demonstrates to the judges and juries how exactly the situations occurred.

Let’s Sum It Up

Law firms all over the world are now being disrupted by the changes provided via technological developments. All these innovations and softwares are bound to change the nature of legal practice and bring efficiency. 

Law firms and attorneys ought to opt for these changes and be at the top of their game to maintain their competitive edge. Below we have summarised the 5 innovations we spoke about in the post.

LegalMation helps the attorneys by automating a lot of repetitive drafting of standard documents. 

Gyi Tsakalakis, founder of Attorney Sync proposed utilisation of technology to improve responsiveness and strengthen client relationships. 

Pacerpro as a software streamlines and automates the distribution of federal court websites, thereby capturing the relevant data. 

Slack comes off as an effective alternative to email communication for automating the legal workflows. 

VR technology has contributed vastly to the legal industry through its scientific accuracy.

We are happy to join the battalion of innovators in the Intellectual Property (IP) domain. We, at Triangle IP, have created an innovation capture and tracking tool to empower patent portfolio managers, inventors, patent prosecutors and startup founders.

(We shall insert a short video for TriangleIP TIP Tool here)

We look forward to seeing you go digital wherever possible. Wishing you good times ahead! 

Is My IP Strategy Headed in the Right Direction?

Triangle IP - Is my IP strategy headed in right direction?

As a fledgling company looking to make your mark, you have to be defensive. The lawsuits are quite a costly affair and can certainly be lethal. You will find yourself being pushed into bankruptcy even before you can really get going. Patents are expensive. But the protection that a strong patent portfolio can give your company is unmatched. 

Seek first to understand, then to be patented 

Building your own patent strategy is personal to your business and its goals. It largely depends on your company’s strategic vision. But it is also important to understand your competition. Possessing competitive intelligence is key. To build an effective patent strategy, understand your market and your competition.  If you are entering a market space that is patent heavy, investors will be expecting you to have patents as well. But how many do you need? And where should you start? 

Start from the very beginning 

A good place to start is Google Patents. Let’s say you are a start-up that’s entering the marketplace with a product that is a virtual assistant. You might suspect that in the digital age, this is a heavily patented space. A simple search on Google Patents will list for you the details of many patents in the space. You will find details including who are the inventors and owners along with many similar patents. The free platform provides a comprehensive coverage of every patent. The status of filing, litigation (if any), the office it has been filed in, etc. is all available to anyone. ​Spend a little more time studying the competitor innovation along with their filing their habits in the patent world. This will help you build competitive intelligence as you pursue your own patent portfolio. 

 Without patent(s) to protect the innovation in your product, you will be a pigeon amongst cats. Without patent protection as a defense, you are exposing yourself to attack. This can be in the form of infringement suits or threats that scare away your customers. Competitors will look to shake confidence in your investors or slow you down before your IPO. Or worse still, look to remove you from the marketplace before you reap its rewards. 

Before you build your portfolio to protect your company, go back to the drawing board. Relook at your vision for your startup and draw a blueprint of your product’s journey as it navigates past the competition. Mark out where you want to be in the next six months, year, five years, and then long term. Once you have the answers to those questions is when you choose which patents you want to pursue.  

Build a Portfolio; Ward off Litigation 

Did you know you are less likely to be sued with a strong patent portfolio than without it? With a patent portfolio, you are reducing the risk of the patent suit out of fear you would countersue. You are also giving yourself a chance to go on the offensive when you need to.

Sharks (large companies with many patents) are always on the lookout for little fish (start-ups with little to no patents). By not having patent protection, you are more likely to lose a patent lawsuit. The reason is not only statistical but logical. You become an easy target to go after as there is little chance of countersuit and even if unsuccessful, a small company can be bled out with the extraordinary litigation costs.

But patents are an expensive affair. (Read this to know everything about costs of IP in the US and this to know how to make your money work for you.) Choosing the right patents to have is an important part of competitive intelligence. If your portfolio is too small there is more risk of losing a patent battle. Your portfolio should be commensurate to your position/station in the marketplace. Having a portfolio that has about half the number of patents as compared to a competitor twice the size is a good rule of thumb. Being in this position will allow you to counter-sue. When the competition knows that it is susceptible to a countersuit, it is less likely to take you to court.  

In Sum, Strategy First

A strong patent portfolio doesn’t always mean having a ton of patents attached to your name. A strong patent portfolio is something that is unique to your company’s innovation. It is something you think about as much as you think about your product. Having the right patents is as important as having the right product while procuring patents to match your growth timelines. This can be difficult with all the distraction that product development and new releases can bring.

Having a strategy and growing your portfolio along with your product success will strengthen your market dominance. Seek professional advice in building your patent strategy. That way, you stand to make the most of your investment. We’ve got Google’s most asked patent questions answered here for you already! Patents can be your biggest business weapon and most attractive assets. They attract investments when your fledgling product gains market while protecting you when you grow. So choose wisely, build well. 

On that note, from us to you – Happy Patenting!

Patents Vs. Trade Secrets: Which Way To Go?

Patent vs Tradesecret which way to go

‘Patents are expensive, why don’t we just trade secret everything?’ If this is a thought and cost cutting is something you’re looking to do, read on. It is no secret that investing in patents is an expensive affair. At the same time, a rich IP portfolio is very advantageous. Here, we talk about Patents, Trade Secrets, and Defensive Publications as IP tools to help you decide which one to be used in which scenario.

Trade Secret:

A trade secret is any information that’s unique to your enterprise and gives you an advantage over your competitors. As a company, this could include formulae, technical data, code, manufacturing data, customer information or any other technical, scientific information that a company may take steps to keep secret.  To keep such things as a trade secret does not require any money however you need to take care of certain things to maintain the secrets (as described later).

Defensive Publication:

A defensive publication is a disclosure of invention by the inventor to the public. This disclosure allows the inventor to safeguard the freedom to use this invention by preventing others from patenting it.

In the event a patent is sought to be obtained for the same or similar invention, a pre-dated defensive publication will act as a deterrent to the issue of such patent.

Put simply, any printed or electronic publication that fully describes an invention and was published before the filing date of a patent application can disqualify that patent from being granted.

Patent:

A patent is an exclusive right granted by a government for an invention, which is a product or a process that provides, in general, a new way of doing something, or offers a new technical solution to a problem. 

In order for an invention to be patentable,  

  1. It must be new
  2. It must involve an inventive step, one that is non-obvious to a person skilled in the field
  3. And it must be capable of industrial application

Patents protect your inventions for 20 years during which you enjoy a monopoly in the market place within the geographic boundary that your patent has been granted in. As a patent owner, you have the right to prevent others from using it, abandon it, sell it – assign it or license it in totality or for a specific purpose. 

So, how does one choose what kind of protection to use for an invention? 

Trade Secrets

There are three vital things to do when you think of protecting something as a trade secret:

  1. Define your trade secrets and maintain an inventory of the trade secrets of your organization.
  2. Make your employees aware of the fact that these are trade secrets. Ensure confidentiality and non-disclosure agreements are in place.
  3. Do not make any information about your trade secret publicly available.

If these are things that you think you can do, here are some questions that will help you decide if a trade secret is the right form of protection for your innovation:

How easy is it to reverse engineer your invention?

The thumb rule of trade secret protection is to use it when inventions are impossible or require a very hard degree of effort to be reverse-engineered. By its very nature, a trade secret is vulnerable to reverse engineering because it only remains secret until it’s a secret! So, patent protection for inventions that can be easily reverse-engineered is more appropriate. How easy reverse engineering is; depends on the nature of your invention.

Mechanical inventions

Products that are a result of this kind of innovation are fairly easy to reverse engineer. With anything that is easy to reverse engineer, trade secret protection becomes completely ineffective.  

Chemical Compositions, Software & Electronic Inventions

While these are not as easy as mechanical inventions, with a little time and effort these products can also be reverse-engineered. Read this to understand how!  

Processes

These are quite difficult to reverse engineer. Since processes are business-specific, they are easier to keep within the company. There is a long list of food products that have managed to keep their recipes or chemical formulae as trade secrets for many years e.g. Coca-Cola, Listerine, Twinkies, Krispy Kreme Donuts, WD-40, etc. Google Search Algorithm and NewYork Times criteria for creating the best Sellers list are two processes that serve as great examples for trade secrets.

How beneficial is it to your company to keep your invention a secret?

In a cut-throat market place, competition is everything. A major aspect to consider if keeping your invention a trade secret gives you a clear competitive advantage. There are six factors of competitive advantage: price, quality, selection, speed, turnaround and service. Does your trade secret serve or help further any of these purposes?

Who are your likely competitors and how motivated will they be to access your invention?

To choose the right kind of IP protection, it is important to understand your competition. The motivation of your competition to access your invention will be directly proportionate to your market position. So, having a clear understanding of your market, your product and the path of your company will help with answering this question. 

Will the invention be useful after 20 years?

One of the reasons you choose trade secret protection over patent protection is to extend the lifetime of protection that it offers. While patents offer you protection or a monopoly of 20 years; trade secrets can last you a lifetime. Although trade secrets are less of a strain on the pocket procedurally, keeping them a secret always comes at a cost. Being able to gauge the usefulness of your invention after 20 years is a great tool to decide how you would like to protect it. 

Patents

The following is a list of reasons to patent and questions that will help you evaluate the patentability of an invention:

  1. A business usually wants to patent an invention to have a competitive edge, market power, and as a tool to earn more money. Hence the first question to ask is whether there is a market for the invention, the technology, or products incorporating it? 
  2. If there is a market for your invention, what are the available alternatives to it, and how do they compare with your invention? Check multiple factors such as utility, price, availability, customer satisfaction etc.
  3. Once you have data on the market space, ask if the invention is useful for improving an existing product or developing a new product? If so, does it fit in with your company’s business strategy? 
  4. Another big reason for choosing to patent is using it as a tool to raise funds and attract potential investors. Before you choose to spend resources on a patent, check if there are potential licensees or investors who will be willing to take the invention to market?
  5. If you are looking to patent to sell your invention or as a tool to add a new revenue stream by licensing your patent, ask how valuable will the invention be to your business and to competitors? Also, just how easy is it to reverse engineer your invention from your product or to “invent around” it? Is reverse engineering easy enough to tempt others, especially competitors, to invent and patent what you have invented? 
  6. Purely as a tool to increase sales, profits, and revenue, do the expected profits from an exclusive position in the market justify the costs of patenting? 
  7. Lastly, what aspects of the invention can be protected by one or more patents, how broad can this coverage be and will this provide commercially useful protection

Defensive Publications

If you don’t want to walk down either the Trade Secret or the Patent route, you may consider a Defensive Publication. By making a defensive publication, your invention is neither a trade secret, nor patentable (if not done so within the time frame offered under certain jurisdictions). A defensive publication may be ideal for smaller inventions or inventions which do not serve your company greatly, financially.

What a defensive publication does is safeguards your right to continue doing what you are doing or at the very least opening yourself out to challenge patents. When you make a defensive publication, you essentially disallow someone else from filing a patent. Or giving you the arsenal you need to hold a patent invalid because you published first. With a defensive publication (made in the USA), you are given a one year grace period to file a patent based on such publication. 

A Quick Recap

To summarise, here is a tabular comparison as a reckoner drawing up a comparison between the factors to consider in deciding whether a trade secret is better for your invention or a patent

FactorsPatentsTrade Secrets
Reverse EngineeringNot a factor that needs to be worried about since you make public disclosure with a patent, and are granted full rights.The easier it is to reverse engineer your invention, the riskier it is to protect it as a trade secret.
CostExpensive mechanism of protection. Involves attorney fee for drafting and filing and official fee for obtaining a patent.In theory, a trade secret is free. Practically, keeping it a well-guarded secret may cost your company a certain sum of money. But this will always be cheaper than filing a patent.
Degree of difficulty in preserving secretWhen your invention is such that it is difficult to protect its secrecy, filing a patent is the correct option.When your invention is such that it can be protected as a secret, and you can have sufficient safeguards in place to ensure the same, protecting it as a trade secret is a more beneficial option.
Life of the inventionIf your invention can stand the test of time and still be relevant after twenty years, this is not the right protection.The benefits of keeping a trade secret are directly proportionate to the life of your invention. The greatest example being the formula for Google Search Algorithm.
Funding and Marketing Better option to obtain funding as ideas become easier to explain to investors because of public disclosure. Difficulty in explaining the invention to an investor for fear of divulging a secret may prove to be a hurdle for funding.
Lead Time Advantage or First Mover AdvantageWith public disclosure of your innovation, there is little or no lead time advantage. In other words, you lose out on the advantage of being an initial significant occupant as disclosure through a patent application can help competition enter the same market space slightly quicker than otherwise. With choosing to protect your invention as a trade secret, you can extend this advantage to a slightly longer time as your competition will have no information on your invention in the public domain before its market entry. 

Choose wisely when deciding how you want to protect your ideas/inventions. Trade secrets are a great way forward and help you save your resources. Use these resources in patenting your best inventions. They don’t always have to cost a fortune. Here’s a guide to cost-effective patenting.

Like all things, life and business, IP protection is also all about balance. Trade secrets and patents can sometimes be used in a manner that is more complimentary than the contrary. IP strategy is personal to a Company and its journey. Hopefully, this will help you find the best balance.

10 Types of Innovation To Drive Growth at your Company

10 Types of Innovation

“80% of executives think that their current business models are at risk.” – according to McKinsey. Executives also feel a lack of clarity on what the problem is and how to improve.

If you feel the same way, read on for some ideas that can help you drive growth at your company by innovating.

“Innovation is the only way to win.” – Steve Jobs

As a business that is looking not just to stay afloat but be relevant, one is continually looking for different ways to innovate. 

Innovation can happen at so many different levels. It can be new ideas leading to new products, old ideas in a new market space, or new ideas in an old market space. It can also be new ways of reaching customers; whether by services or packaging. Or even a change within the company structure to result in a change in company ethos.

Here is a list of 10 types of innovation for you to ignite the spark of innovation in your organization:

1. Product Performance Innovation

“There is a way to do it better – find it.” – Thomas A. Edison.

This is a great place to start, for it focuses on product features and value offered to customers. This innovation will allow you to focus on making your products better without much other change.  It will also give you the option to create new products. Also, updates and line extensions that add substantial value. Features, functionality and design are the core of this type of innovation.

Let’s take a look at the evolution of Toyota Prius, which set a trend for hybrid cars 15 years ago. And has constantly improved fuel efficiency with each generation:

TimelineGenerationInnovation in Fuel Efficiency (Improved Performance)
1997-2003First28.0 km/L in Japanese 10-15 test cycle
2003-2009Second35.5 km/L
2009-2015Third38.0 km/L.
2015-Fourth40.8 km/L in Japanese JC08 test cycle

2. Structure Innovation

Structure innovations aim at reorganisation of company assets. These assets can be hard, human, or intangible. This kind of innovation challenges you to make them work in unique ways that create value. Tapping your human resources to develop a new talent management system or configuring your heavy equipment in a manner that increases production are a couple of ways of innovating structurally.

In sum, this is how you structure and organize your assets. This type of innovation is usually the most difficult to copy. These unique changes are particular to your organization and they go on to provide a foundation for your Company to build a sustainable future.

Vertical farming (an urban farming solution) used in Singapore is a perfect example for structural innovation. Singapore is a small island and scarce in natural resources as required for farming.

Sky Urban Solutions, a Singapore based company, took upon themselves to solve this challenge in 2009. As the land is scarce, Sky Urban came up with the innovative idea of vertical farming, farm over a farm. In concept, it is similar to a multi-storeyed building which is a vertical arrangement of house over a house.

Sky Greens’ A-Go-Gro System

3. Channel Innovation

One interesting way to differentiate a good and great product is a way how it is channeled to the customer. Channel innovations focus on how you connect your company’s offerings with your buyers. The challenge is to find ways of giving your customer the most innovative delivery experience.

A great example of channel innovation is the Subscription Model that a number of companies have recently adopted. Offering products to your consumers in a ‘curated’ form, with special goodies reaching them every month is an exciting way of broadening customer base. 

I would like to share a personal experience here that I had when I subscribed to Mel Science. Mel has brought monthly experiment kits for young minds to experience the wonders of chemistry. My son absolutely loves it. And I think his amazement translates into successful channel innovation at Mel.

4. Profit Model Innovation

Your approach to profit model innovations can be many. As the name suggests, this innovation is driven by profit as the motive. A good profit model will find a new way to convert your company’s offerings and other sources of value into cash. A great one is born of an understanding of what your customers value about your company. This understanding of what is cherished by your market is where new revenue or pricing opportunities can be found.

AirBnB was born in a rented accommodation when the founders couldn’t afford paying their rent. What started out as a rental of air mattresses cum breakfast, has today become AirBnB. With little, to no capital investment, AirBnB has given billions of people great holiday experiences.

Understanding what customers want, they have aced the minimal input –  great return game. Besides, it’s exemplary to see how beautifully they have pivoted with “online experiences” when the pandemic hit.  

5. Incremental innovation

Incremental innovation is about taking baby steps towards your goal! It is a series of small improvements or upgrades made to your existing products and/or services. It challenges you to increase your product’s value to the customer. You may do this by upgrading features, design, etc. while playing your own market. These changes focus on improving an existing product’s development efficiency, productivity, and competitive differentiation.

Developing a product in increments is the way most tech companies function. Whether it is Amazon and its range of Echo or One Plus and its range of phones.

Utilizing their existing technology, these companies play their own market encouraging and enticing their customers to upgrade and keep up with their innovation.

6. Process Innovation

Process innovations are in a way similar to structure innovations – both these kinds of innovation involve changing the way things work inside your company. Process innovation challenges you to think of ideas out of the box so as to bring out what is unique to your company. These innovations call for you to modify your core competency, as a company.

Process innovation happens by changing the activities and operations of your company. Unlike other innovations that push you towards revolutionizing a product, this pushes you to make the journey more rewarding. Some of the ways in which process innovation may occur is in IP strategy or a shift in the method and process of building a certain product.

Fast fashion has revolutionized the industry. An industry that was essentially driven by seasons and ramps. H&M, by working on collections that were not dictated by these terms but the needs of the market escalated its growth by a small change in business as usual.

7. Red Ocean Innovation

The market and industries as they exist today is the Red Ocean. It gets its name from the cut-throat competition in existence to grab a greater market share. With all things being equal, this kind of innovation can be the easiest, but also the most difficult.

How can you revolutionise a product in existence?

This is the challenge of red ocean innovation. Urge your company to pick up something old, a product you may already have floated in the market, and shake it up to change the user experience. The user needs to feel like your product is the only one that (s)he MUST use! 

Creating a no-frills, low-cost airline was a masterstroke in the crowded airspace. AirAsia by introducing tickets and prices that made flying affordable caused a stir in the ocean.

8. Blue Ocean Innovation

Contrary to the Red Ocean, the Blue Ocean is an unchartered territory. Innovation in the blue ocean encourages you to create a new market space and leave the old, bloody market space behind.

Hence, in the Blue Ocean you don’t compete over existing products instead you rather create a new market space altogether.

With this, you also set the benchmark for a market space that may have a future, thanks to your product.

New market, new product, new pioneer!

This is perhaps the most exciting innovation because it requires you to think like there is no box!

Cirque de Soleil is the greatest example of Blue Ocean Innovation for not only did it bring back the circus, it made it a luxury! By eliminating animal involvement and adding theatrical elements, Cirque has created a loyal audience and a brand in itself. It hurts to see how pandemic has hit them hard.

However, we all look forward to seeing how they pivot themselves. 

9. Disruptive Innovation

A step further in the unchartered direction is disruptive innovation. Here, you ring out the old and ring in the new.

Consumers are easily bored.

When you innovate to disrupt, you tap that boredom and turn it into something exciting for the consumer.

A simple idea with maximum impact would work like a charm. But, in the right market. So, once you identify the market that has bored its consumers, all you need to do is come up with an idea to revolutionize it. Value creation will follow closely behind.

Netflix has been a great disruptor. Understanding that there was a market of customers who were used to online shopping, Netflix tapped into this. Creating an OTT platform, it overlooked ardent DVD subscribers and targeted the “new normal” instead. 

10. Service Innovation

“Never ever compete on prices, instead compete on services and innovation.” – Jack Ma

Service innovation is about how you make your product easier to use. Making your product more enjoyable for your customer – servicing his/her needs.  Helping your customer get better value from your product.

These are what will set you and your product apart. The challenge with service innovations is going above and beyond.

A product is not all R&D. Here, the goal is to reach the very heart of your customer.

Nike has long been known for its customer experience, but it has taken things to the next level at its new New York City flagship store.

The Speed Shop allows customers to order shoes online and try them on in-store. Customers use a special entrance to find their shoe locker, which is unlocked via smartphone. After trying the shoes on, they can check out on mobile without having to interact with a person.


These innovation tips should give you and your organization the impetus it needs to continually innovate. Innovating within your company is as essential as innovating your offerings. All good ideas need interaction, conflict, debate. Encourage that within your organization.

Last but not the least, I wish to recommend to you a great tool that can help you in tracking your innovations – TIP by TraingleIP.

It is a great place for you to capture and collaborate on your ideas for your innovations.

5 Factors to Consider while Evaluating any Idea Management Tool as a part of your IP Strategy

Evaluating an idea management tool

Logically speaking, any investment is worth only if it reaps great returns.

A study by Accenture suggests 62% percent of high-growth companies plan to invest in technologies that lead to higher rates of innovation, compared to 54% of other companies.

Investing in technologies that lead to higher rates of innovation shall be beneficial only if the intellectual property created based on the innovation aligns with:

a) company’s business goals/product line.

b) has a market demand.

c) has the potential to be monetized either by licensing or selling.

d) enhances customer experience.

e) generates revenue growth.

After all, filing a single patent costs a minimum of USD 10,000.

Not sure about the cost of getting IP protection for your product or company? Here is everything you need to know about costs related to your IP in the USA.

Now, where is the scope of failure in creating IP wealth for the company?

1. Patent creation was not thought of from different angles like feasibility, demand, investment, etc.

2. Collaborators from the various segments did not participate in the journey from idea to patent.

3. Redundancy in the novelty of a patent gets caught at a later stage.

All this happens due to the absence of the right tool/software that can assure strategic collaboration and tracking.

So, as a patent portfolio manager of your company, an innovation tracking software tailored to your needs shall be an asset.

A tool that addresses each stage of the journey of an idea to patent as shown below:

Idea Management Process Triangle IP

Here are the 5 factors you should consider while you evaluate an idea management tool:

1. Is the tool easy to use?

2. Is the tool engaging to attract collaborators?

3. Does the tool provide real-time updates?

4. Does the tool manage the process throughout the life-cycle (Idea to Patent)?

5. Does the software keep evolving and getting more sophisticated?

Is the Idea Management Tool Easy to Use?

There is a good possibility that you might have used one of the following ways to manage ideas at your company:

1. Spreadsheets

2. CRM Software

3. Home grown tools comprising forms and tabular data

4. Collaboration tools

5. Expensive Docketing Software

The biggest shortcoming of these solutions is the complexity to use.

Nobody likes to fill long forms. Don’t you agree?

As the number of ideas, collaborators increase, tracking the updates on ideas/innovations becomes tricky and painful.The above mentioned methods are just makeshift arrangements, and not specifically designed keeping user experience in mind.

These tools lack intuitiveness and broad adoption across the enterprise. A user does not feel motivated to use the tool unless really needed. It’s the same as using a handkerchief in place of a specifically designed mask.

A handkerchief is just a make-do arrangement, however, a mask is designed keeping in mind filtration, breath-ability, comfort, ergonomics, etc.

On the contrary, if the tool is easy and simple to use, the collaborators will be encouraged to use the tool. Thus, speeding the process and achieving better results.

Is the Idea Management Tool You are exploring Engaging?

No innovation program is going to be successful unless you make it engaging. If the tool is not engaging, a user won’t be excited or motivated enough to share his/her ideas.

Encouragement to share the ideas is the very basis of such a program. It’s pretty much the same as sharing posts on social media like Facebook or Linkedin.

Engagement on posts through reactions, comments, impressions, views encourage the users to share even more. Not just more sharing, in fact, it gives users an idea of what type of posts score better in terms of response.

Below are just 10 ways out of many that make an idea & innovations management tool engaging:

1. Minimizing the friction to share ideas/feedback/updates or anything related to the tool.

2. A notification of idea submission to the collaborators for review.

3. A notification of feedback reception to innovator/inventor.

4. Patent Analytics driven Artificial Intelligence (AI) based review/rating on an idea from the tool.

5. Redundancy indication from IP Counsel.

6. Inputs on making the claims stronger for a Patent from IP Counsel.

7. Update on an innovation from business angle to all the collaborators.

8. Budget sanction notification for a successful innovation to be patented.

9. Patent draft available for review notification for all the stakeholders.

10. Inviting ideas to solve certain business challenges through innovation.

Does the Tool share Real-Time Updates?

A lot of stuff out there is very static. For example, if you wish to know the status of the company’s IP, you shall place a request for IP report generation to your patent attorney. The report shall most probably be in a form of a table/spreadsheet. Such a report makes it cumbersome to draw valuable insights on the IP front.

Another major problem with such a report is that it very quickly gets out of date. Hence what’s needed is a provision to track what’s happening with your innovations in real-time.

Here is how real-time updates are really beneficial:

1) People get busy developing the product, they forget about what’s happening with their innovation.

2) A system that monitors what’s going on shall help in making sure things are adhering to the process.

3) Timely updates help is avoiding last moment rush:

  • Realizing that you haven’t filed a patent yet and you are closer to the product release.
  • And then you are scrambling through to find out what’s happening and reaching out to IP counsel to get an update.

4) A one-shot way to update all the stakeholders allows for the transparency of the IP management.

Does the tool Manage the Process throughout the Lifecycle (Idea to Patent)?

Does the tool manage the process throughout the life-cycle(i.e. from Idea to Patent)?

The most common and important question that arises in this whole process is: do we file a patent or not?

Earlier the decision about patenting takes place the better it is, as it results in saving time, money, and effort.

Right provisions like below in the idea management tool can help in taking this important decision in the early stages or at least before regretting the investment made in patenting:

1) Visibility into a knowledge repository of ideas helps to avoid redundancy. There is a possibility that a similar idea got patented earlier. Even before the inventor of innovation in question got hired.

2) Vetting by Subject Matter Experts early on helps in shaping the idea and decide which ones to be pursued

3) Ability to view the patent draft as well as final patent application on the same platform.

Does the Innovation Management Tool keep Evolving and Getting more Sophisticated?

A pleasant surprise always makes you feel happy. Isn’t it? And only happy users can ensure the success of such a tool.

Innovations do not happen on a daily basis. But, whenever a user comes to the tool, new pleasing features shall engage him better. So such an innovation tracking tool needs to continuously evolve and keep getting more sophisticated.

Here are a few ways to achieve sophistication in an idea and innovation management software:

1) Improved Analytics

2) Enhanced Idea Nurturing

3) Dashboard driven by Great User Experience

4) Customization based on organizational needs

“With the right tools and a great team create strategic IP wealth and not dead investments.”

For a company, that files 40-60 patents per year, a tool that is specifically designed for idea capturing and vetting is sheer bliss.

It is important to make the best use of budget allocated towards creating IP.

We hope that this article could give you pointers to make the right choice for an idea management software.

TIP Tool is one such tool that is getting developed along the lines mentioned above. It currently provides ideas capturing and vetting.

Want to be a part of our beta community? Try it for free.

Types of Intellectual Property & Related Costs – Triangle IP

Everything about you IP cost in US

A Quick Overview: Types of IP

Type of Intellectual Property (IP) protection needed for an invention depends on the nature of invention. Each of 4 main types of IPR – Patents, Trade Secrets, Copyrights & Trademarks has their own use cases. Patents are best suited for inventions that revolve around a product – process of manufacturing, its layout or appearance etc. If you wish to protect a recipe or a formula, keeping it as a trade secret shall be the best choice. Copyrights protection is well suited for artistic works like music. Trademarks are the best way to protect the visuals that represent a brand.

Each type of IPR protection costs different, this post shares great insights on costs related to each type of IP protection.

To Patent or Not To Patent: Inventor’s Choice

In August  2010, two MIT alums filed a patent for an application that helps multiple clients share and access files over a network. There are high chances that you’ve used this file-sharing app. You must have used “Dropbox”, Haven’t you? Today, it has more than 14 million users and is a billion-dollar enterprise.

Dropbox patent drawing - Intellectual Property related costs

Not every founder, inventor or developer is as generous as  Linus Torvalds, who gave his masterpiece (LINUX) to the world for free? 

If the founders (Drew Houston & Arash Ferdowsi) of Dropbox Inc. hadn’t protected their asset by patent, Dropbox might have even had 10 times its user base today, but they wouldn’t benefit from it. This is why individuals and organizations should safeguard their intellectual property. 

Most organizations are wary about the costs involved in protecting their intellectual assets.There is an assumption that it costs a bomb to get it secured. While there is no easy answer on how much it costs to safeguard your intellectual property, the safest answer is – “it depends on a lot of factors”. In this article, we will help you traverse the difficult terrain of intellectual property and your IP related costs. 

What Is Intellectual Property? 

The intangible creations of the human mind are called intellectual property. It refers to inventions such as literary work, artistic work, designs, symbols, names, product recipes, images, and so on. To ensure that others do not steal your intellectual property, you need to secure them.

There are four different types of intellectual property (IP) rights.  

  • Trademark
  • Patent
  • Copyright
  • Trade Secret

Types of IP - Intellectual Property related costs
Credits: Vecteezy

Trademark:

An American conglomerate filed a lawsuit against a Chinese company for using a brand name that was eerily similar to theirs. Even though the courts found that there were dissimilarities in products, since the latter was able to acquire clients and capture significant market share using the brand name, they had to pay up the American company. 

What Is A Trademark?

It protects brands. Under the law, a trademark is anything by which customers recognize a brand or the source of a product. A trademark offers legal protection for logo, design, symbol, phrase, wordmarks, or a combination of those that represents a source of goods or services. 

Example:

Trademark Example - Intellectual Property related costs
Credits: Legalwiz

Costs For Securing Trademark Rights in USA:

According to USPTO, the initial application fee for electronic filing for a trademark is $225 per class of goods/services. There are 45 classes of goods and services. 

  1. Your attorney will file a trademark application for you and the charges for it will be anywhere between $300 and $1000.
  2. Once the application is filed, it will be examined by a Trademark Examiner. 
  3. If the examiner issues an Office Action refusing the application, then the attorney’s fees to respond to that would be between $200 and $2000. 
  4. The application needs to be filed based on having used the mark already for sales or with an intent to do so in the future. A Statement of Use is filed if nothing has been sold using the mark. The government’s fee to file it is $100 for each class of goods. Attorney fees to prepare it is between $250 and $700. 
  5. After your application has matured to registration, you must fill the required maintenance documents. Between the 5th and 6th year of registration, Section 8 declaration has to be filed. 

i.) A Section 8 declaration is a signed statement saying that the trademark is in use in commerce and if not, then it should come with an excuse explaining the reasons. 

ii.) Between the 9th and 10th year after registration, a combined declaration of use/non-use and application for renewal under Sections 8 and 9 should be filed together. The fee for combined filing is $425 per class of goods or services. 

For a detailed account of the trademark fee, you can use this link here

How Long Does The Trademark Protection Last?

While the terms of trademark registration can differ, the duration is usually ten years. Also, the USPTO requires that between the fifth and sixth year after the date of registration, the trademark owner should file an affidavit stating that the mark is still being used commercially. If the affidavit is not filed, the registration is cancelled. The USPTO will not send any reminders requesting you to send the affidavit. 

Note: The trademark can be renewed indefinitely by paying additional fees. 

Patent:

One of the most famous patented inventions is the electric lightbulb. Another significant one is the telephone (Transmitter and Receiver for Electric-Telegraphs) which was patented by Alexander Graham Bell in 1876. Each of these made the patent owners significantly wealthy. 

What Is A Patent?

Patents protect the innovative ideas of processes. There are two types of patents:

  1. Utility patent – It protects a process, manufacture, composition of matter, and a useful machine. Example: Fully convertible high heel-to-flat shoe

Utility Patent: Convertible High Heel Shoe: Types of Intellectual Property

  1. Design patent – It protects the shape, appearance, pattern design, layout, and looks of a product. Example: Car or similar article by Warner Bros. (BatMobile)

Patent D311882 Bat Mobile - Intellectual Property related costs

Costs For Filing A Patent in USA:

For filing a patent, the costs vary not only based on the country, but also on the complexity of the invention. It could be $1000 if you plan to do most of the filing work or can be upwards of $40,000+ if your invention is complex. 

  1. The basic cost to file a patent application at the USPTO is $300. If you are an individual, and it is $75 and $150, if you are a small entity. 
  2. For professional attorney patent searches, it would cost anywhere between $800 and $3000. Find the best tips to hire a patent attorney here.
  3. Expect to pay anywhere between $3000 and $5000 on average plus the USPTO fees to an attorney to prepare a new patent application. 
  4. The costs for the patent depends on the type of patent you apply for. 
  1. Provisional Patent: $1500 – $3500
  2. Utility Patent: $5000 – $15000
  3. Design Patent: $2000 – $3500
  4. Plant Patent: $4500 – $8000
  5. International Patent- $100000+

Here is the USPTO link where you can find more information about the fees for filing a patent. 

If you want a cheaper route, then you can do all of this by yourself, but you need to be meticulous in terms of recording everything about your invention. You might have to spend hours filing everything correctly. 

Choosing Inventions For Patenting

While every innovation of your invention deserves a patent, it might not be feasible to patent everything as the prices are a bit steep. Not everyone has huge budgets so corporations may have to pick and choose on what to patent (according to the strategy that they might have). You need to evaluate your ideas before you decide. The company should take the call on which part of your invention to pursue for patenting. The most important part in this process is to keep a track of all ideas so that nothing is missed. You can use a simple spreadsheet but that tends to get corrupted with time along with having security issues. TriangleIP provides a free tool which helps you in maintaining and tracking your ideas. It provides you with 4 different workflow stages till the filing process – through which you can navigate and track your ideas. 

Maintenance Costs:

Patent maintenance fee is paid to the USPTO to keep up a granted patent and is sometimes applicable for pending patent applications. Note: Design and Plant patents do not require maintenance fees. Maintenance fees are to be paid at the fourth, eighth and twelfth year anniversary from the time the patent is granted. To calculate the maintenance fees for your patents, you can use this link from the USPTO website

Maintenance Fees of patents - Intellectual Property related costs

How Long Does Patent Protection Last?

A utility patent is granted for 20 years from the date the patent application is filed. A design patent is protected for 14 years from the date the patent is granted. To enforce the protection of the patent, there are fees involved. 

Copyright:

Vanilla Ice’s song Ice Ice Baby used parts of music from the song Under Pressure by David Bowie and Queen.

When they faced a lawsuit, Vanilla Ice confessed to sampling the work, and the case was settled out of court for an undeclared sum of money and crediting Bowie/Queen for the track. 

What is Copyright?

It protects the original work of authorship. It helps the copyright owner to control reproduction, performance, adaptations, and distribution of the work. Examples of such works are- literature, drawings, paintings, songs, music, computer software, films, photos, web content, etc. 

Copyright is generally attached to the work when the original work is available in a fixed medium. It means that the work has been written down on a piece of paper, saved in a storage device, or in some tangible format. 

Costs for copyright protection in USA:

Filing a copyright application involves a lot of forms and each of them has different fees. Here is a breakdown of the costs involved to copyright your work.

  1. The copyright registration fees for one work by one author costs about $45 if you are filing online. The fee is $125 for paper filing. 
  2. For all the other filings, it will put you back by $65. 
  3. There are special fees for registering an application claim in a group or obtaining additional certificates of registration. 
  4. The USPTO does special services that have a different fee format too. 

How Long Does A Copyright Last?

The terms of a copyright for a work depends on a variety of factors, including whether it has been published and if yes, then the date of publication. 

  1. Copyright protection lasts for the author’s entire life plus an additional 70 years, for works created after January 1, 1978. 
  2. For anonymous works, or a work made for hire or a pseudonymous work, the copyright is for a period of 95 years from the year of its first publication or 120 years, whichever expires first. 
  3. For works published after 1923, but before 1978 are protected for 95 years from the date of its publication. 
  4. If the work was created but not published before 1978, then the copyright lasts for the life of the author plus 70 years. 

Renewal:

For works that are created after January 1, 1978, the copyright is not subject to renewal registration. 

Trade Secret:

In 1953, inventors at Rocket Chemical company came up with a formula at the 40th attempt and called it WD-40 – “Water Displacement, 40th Formula”. The company never patented it because trade secret seemed like a better protection and wisely so. And the company managed to keep it a secret for 50+ years. By the fiscal year 2017, gross revenue for the company, including sales of the familiar WD-40 Multi-Use as well as other products, totaled $381 million in annual revenue. It was only in 2009, that “Wired” with advanced processes like gas chromatography and mass spectroscopy managed to find out what’s inside WD-40.

WD 40- Tradesecret - Intellectual Property related costs
Credits: Wikipedia

What is a Trade Secret?

A trade secret is any valuable information that is not publicly known and of which the owner has taken reasonable steps to maintain secrecy. It could be ingredients used in their dishes, business methods, customer data, ideas related to your business, marketing strategy, experimental technology, etc. 

Costs To Guard Trade Secrets in USA:

Since you don’t have to register with a government body for qualifying your product/business as a trade secret, there are no costs associated with it. Guarding the secret requires security measures, and these might accrue some costs.

As trade secrets costs feel nominal compared to patenting expenses, you might get tempted to opt for trade secrets. This may or may not be a good idea. Thomas Franklin, the founder of Triangle IP has shared great insights in the following video to choose between patents and trade secrets.

How Long Does Trade Secret Protection Last?

Indefinite protection to the trade secret as long as the secret is commercially viable. It will continue as long as the secret is not available to the public. Also, unlike patents or copyrights, trade secrets are protected without registration. 

How To Protect Your Intellectual Property?

We have discussed the major four types of intellectual property and how they can safeguard your business from infringers. It is the onus of the business to protect its assets. Losing one of your assets can result in significant damages to your business. Getting the right advice from professionals will make it easy for you to protect the interests of your business.

For starters, you could write down a list of ideas, discuss them with your lawyer and decide which are the ones that are worth going after. TriangleIP helps companies with a free tool using which ideas can be managed till the filing process.

Conclusion:

In summary, below is the list of the 4 forms of intellectual property related costs discussed in this article:

IP FormProtects Life (in yrs) Prosecution & filing costsMaintenance Cost
TrademarkInfringement/Damage of reputation by another company10 (can be renewed indefinitely)$225-$400 per class of goods/services depending on the type of application $425 per class of goods/services
PatentIt protects the commercial use of the invention without the consent of the patent owner20$75-$300 based on the size of your company$1,600 for large entity | $800 for small businesses | $400 for micro businesses
CopyrightIt protects the original work of an author70-120 yrsStarts at $45 for e-filingNo maintenance fees
Trade SecretIt protects information that is crucial to a business, using which the entity has a strong competitive advantageLasts as long as the trade secret is viable commerciallyThere is no need to register with a government body to guard your trade secretNo maintenance fees

A report from the Commission on the Theft of American Intellectual Property pegs the loss from IP theft between $225 billion and $600 billion annually. If you fail to protect your intellectual property because of the costs involved, you might end up losing a major chunk of revenue as competitors might copy it. You will lose your competitive advantage too when others claim to provide the same features that you do. 

It is normal to feel overwhelmed with the rigmarole of the lengthy procedures involved in filing applications for each intellectual property, which is exactly why you should delegate it to the experts, depending on the situation.

Five Steps to Take to Protect Your IP Before Your Co-Founder Leaves Your Startup

5 STEPS TO TAKE BEFORE YOUR CO-FOUNDER LEAVES

Remember co-founders are also employees who are privy to confidential information. A leaving co-founder may pose a significant threat to your IP. We bring to you five ways to protect your IP when your co-founder leaves.”

The team that starts a company is often not the one that stays on till the end of it.

Co-founders leave.

A co-founder who is leaving the company may pose a significant risk to the company by claiming its intellectual property rights as his/her own.

A leaving co-founder can start their own rival entity and may end up using the company’s intellectual property.

Typically, when co-founders start a company, they brainstorm, develop an IP, and then start with the business.

This makes the co-founders privy to all kinds of proprietary information. They have seen the growth of the IP from a nascent stage and may think that they have a right to use it, independent of their association with the company, as well.

So, what to do when a co-founder leaves? How to protect the company’s IP against a leaving co-founder?

We highlight below five ways by which you can protect your company’s IP and contractually bind the co-founder to not use or treat the company’s IP as his own:

Assign IP to the company rather than co-founders/Invention Agreement 

Intellectual Property enhances the valuation of companies. Hence, its protection becomes important. IP Rights need to be assigned to the company rather than the founders. In the event, the founders decide to walk away from the company, it is important that the IP rights still remain with the company.

How can IP rights be assigned to the company?

This is where a proprietary inventions agreement comes into the picture.

Such an agreement mandates that all the intellectual property developed, conceived, formulated, and generated by a company would be the sole property of the company.

While drafting this agreement, care should be taken that the intellectual property rights of the co-founders are assigned to the company and that they do not remain the property of an individual. It is not uncommon for companies to obtain trademarks, patents, and domain names in the name of one or more of the co-founders initially.

Later on, these should be transferred in the name of the company.  Any patents which are filed should be filed in the name of the company and not the co-founders. 

Employment Agreement

A co-founder is not only associated with a company in the capacity of a co-founder but also as an employee. He/she may develop intellectual property during their employment with the company.

Rights in such intellectual property should also be vested in the company.

The co-founder’s employment agreement which would be separate from the inventions agreement should contain such a clause. 

Non-Disclosure Agreement

A Non-Disclosure Agreement should be mandatorily signed with the co-founder. Such an agreement would prevent the co-founder from disclosing the trade secrets of the company. 

For example, if you have a restaurant business and there is a unique recipe that has the capability of attracting more customers to your restaurant, this is your restaurant’s trade secret.

If your co-founder leaves and opens a competing business and uses this recipe, your restaurant would lose its edge. A non-disclosure agreement would contractually prohibit him from engaging in such an act. 

Confidentiality Clause

Business ideas form the very base of successful functioning and continuance, therefore it is prudent to bind all current and even former partners by the clause of confidentiality.

Confidentiality should protect the business ideas, trade secrets, any operations/procedures which have been adopted to give finality to these ideas and finally the end-product itself.

A confidentiality clause can be built in the employment agreement of each co-founder, in the Founders’ Agreement, and in the NDA which the co-founder signs.

Remember to make the confidentiality clause applicable even post the termination of the aforesaid agreements.

Typically, a confidential clause should survive 6-12 months after the agreements have ended. 

Non-Compete Clause

A non-compete clause prohibits the co-founders to engage in competing business for a reasonable period of time after they leave the company.

It is essential to have a non-compete clause in the Founders’ Agreement and the employment agreement of the co-founder. 

One hurdle that one may face with regard to non-compete clauses is its enforceability.

The enforceability of non-compete clauses varies across states.

In California, such clauses are void and unenforceable.

In other states such as North Dakota and Oklahoma, the use of non-compete provisions outside the sale of a business is limited. Other states such as Illinois prohibit the use of non-compete with regards to low wage workers.

Hence, having a non-compete clause can be one of the ways in which you can prevent your co-founder from stealing your confidential information and use it for the benefit of a rival/competing entity.

However, it may not be fool-proof and hence should be coupled with other protections such as assigning of IP to the company, NDA, confidentiality obligations, etc. 

Our co-founder recently talked about this in a detailed video. You can watch the video below:

Conclusion

To conclude, while it is understandable that a co-founder leaving a start-up that they helped build may be a devastating blow for the management, it does not necessarily have to be a fatal one.

By doing small exercises to protect the larger interests of the company over the individual interests of the founders, the company can have a strong foundation on which it can be built.

If organizations take steps like including IP ownership by the company, along with NDA and non-compete clauses as part of a founders’ agreement, then any future fallout resulting in the founders splitting ways, will not tear the company apart.

These steps will provide stability to the company and protect its IP.