By Dr. Kalyan C. Kankanala
For a technology-driven start-up or entrepreneur, patents form the most important intellectual assets. They provide the necessary exclusivity and competitive advantage to start, build, and grow the business. Venture capitalists and investors also consider patents before making investment decisions. Thus, every technology-driven start-up must ensure that its technologies and inventions are properly protected under the patent regime.
Once a decision on patent protection is made, the start-up company must file a patent application as soon as possible. Depending on the status of the invention and financial resources, the company may file a provisional or a complete patent application.
[su_pullquote align=”right”]For a technology-driven start-up or entrepreneur, patents form the most important intellectual assets. They provide the necessary exclusivity and competitive advantage to start, build, and grow the business.[/su_pullquote]
Provisional Patents
Filing a provisional application provides the following advantages to a start-up company or entrepreneur:
- The application can be filed in a day or two as claims need not be included in it;
- The cost for drafting a provisional application is much less than that of drafting a complete application;
- Filing a provisional gives the start-up a year (12 months) to file a complete application, nationally and internationally, during which time the start-up company can take necessary steps to raise funds or test the business value of the invention.
Complete Patents
Having said that, a complete specification may be filed if resources are not an issue. Filing a complete patent application provides the following advantages:
- The patent application will be examined earlier than a provisional application;
- The patent application will be granted earlier and legal action may be taken against competitors violating the start-ups patent rights on grant;
- The value given to a complete application is higher than that of a provisional application.
International Patents
A start-up company may also file a Patent Cooperation Treaty application if the company wishes to acquire international patent protection at a later stage. The PCT process is an international filing process which allows the applicant to file national applications in chosen countries after twenty or thirty months.
Filing a PCT application is more expensive than the Indian national filing, but provides the following advantages:
- It gives the start-up twenty or thirty months to test the business or market value of the invention and to decide the countries in which the company wishes to file patent applications;
- It provides the start-up company with a formal search and patentability report that can enhance the value of the patent; and
- It gives additional time to raise funds or make business decisions.
Based on the financial resources of the company and business strategy, a start-up may safeguard its rights over its invention by choosing any of the aforesaid filing options.
[su_divider style=”double”]So Marcos Rojo might have some explaining to do when wife Eugenia Lusardo asks why he quite is so excited in this Instagram post.[/su_divider]
Dr. Kalyan C. Kankanala is the Managing Partner of BananaIP. He is visiting faculty at the National Law School of India University (NLSIU), Bangalore, and a guest lecturer at IIM, Bangalore.
This article was originally published on Sinapse.
Read part 4: Intellectual Property for Start-Ups and Entrepreneurs Part IV: Trade Secrets and Confidential Information