Why SME patent strategies fail and how to avoid these mistakes
SMEs have helped drive the growth in unitary patent applications, as well as claiming the vast majority of R&D tax credits. That being said, many small businesses can be put off filing patents for a variety of reasons.
Long lead times, high costs and the time taken to put together a patent application can all be factors. However, a lot of these issues can be solved by putting a watertight patent and intellectual property (IP) strategy in place.
By getting the right advice as early on in the invention development process as possible, you can build a plan that fits your business, cuts risk and maximises the value of your innovation. This includes understanding and avoiding the following pitfalls.
Not mapping IP to business needs
Whether it’s floating on the FTSE, being acquired by a bigger company or entering into new markets, you’ll have mapped out the future of your business. Your IP plans should match these roadmaps. Otherwise, you could end up with disrupted or delayed timelines and misalignment with your business goals.
For example, if you want to take your invention to market, then you need to build in enough time to get the patent application properly written and filed. Alternatively, if you plan to sell your business after three years, then you’ll want to create an IP portfolio that maximises commercial value for any potential buyer.
SMEs expanding to new markets will need to make sure they understand the costs and practicalities of getting the right IP protections in the right jurisdictions.
By taking into account your business’s plans when making legal recommendations and building the scope of protections, a patent attorney can make sure your IP portfolio is future-proofed to best meet your company’s needs.
Breaks in confidentiality
Consultants, clients and even colleagues can all be potential information leaks. This is a particular concern when it comes to your IP, because any disclosures made public before a patent application is filed could weaken or completely undermine it.
Having the right processes, contracts and agreements in place to protect this knowledge is key to securing the commercial value of your innovation and making sure any legal protections you want can be granted with no problems.
This might involve NDAs and confidentiality agreements, as well as the right cybersecurity infrastructure to stop vital information from escaping your business. Educating your sales team on what they can and can’t say can also go a long way!
Getting legal advice early on in the invention development process will also ensure key innovations are protected and damaging disclosures aren’t made unknowingly.
Little research and no records
It’s not unheard of for SMEs to file a patent application, only to later discover that a competitor had the idea first. This isn’t just disappointing, but can throw out commercial plans, not to mention the amount of time and money wasted.
Running patentability and freedom to operate searches are the first step SMEs can take to avoiding this mistake. Patentability searches look for any prior art that could mean your innovation isn’t ‘new or inventive’, meaning your filed patent couldn’t be granted.
Freedom to operate searches check if you’ll infringe an existing patent by bringing your invention to market.
Beyond these searches, researching the market thoroughly will help you understand if your innovation is truly unique and can bring competitive advantage to your business.
Keeping complete records of this research, plus the whole invention development process, including any ideations, discussions and prototyping, will form the basis of your patent application.
A lack of cash
Yes, the initial searches and filing process have a cost associated with them. However, it’s also important to build out a plan for funding prosecution (getting your patent applications granted), renewals and even any potential litigation.
This has to be accurately estimated and balanced against the revenue you predict you’ll make from leveraging your IP, whether it’s through licensing or bringing your innovation to market.
SMEs not planning for the financial investment they need to secure IP rights is one of the most common pitfalls. This can leave applications at a standstill or innovations unprotected.
A patent attorney should be able to create an estimate of how much gaining the IP protections you need would cost. If budgets are tight, they’ll also work with you to create a plan that balances legal and financial needs.
They’ll also be able to support you through reclaiming tax credits, including via the Patent Box, if eligible. This will help you work out if investment into a patent is commercially viable or not, so you don’t meet a financial sticking point further down the line.
How to avoid these pitfalls
Getting advice from a patent attorney that understands how IP fits into your business needs as early as possible will help you avoid the pitfalls above. While some legal professionals can get bogged down in the jargon and procedure, finding an attorney who’s experienced in working with SMEs means you’ll get commercially-focused support.
By bringing technical expertise, they’ll get to grips with your innovation quickly. Then, they’ll take the time to understand your business plans so they can create an IP strategy that can bring real value and avoid strategic mistakes. Bringing them in as soon as will also allow you both to flex to any changes in the market, scope of protection or commercial roadmap.
So if you’re designing an invention that you might look into patenting further down the line, get in touch with our team. That way we can help you understand if your innovation is patentable, commercially viable and worth investing in. This cuts your risk and helps you develop a successful IP strategy.