5 tips on how intellectual property can help fund innovations
Financing is the key to innovation and growth for innovative entrepreneurs. Want to know how protecting your intellectual property (IP) can significantly increase your chance of success? Benefit from the tips from the Netherlands Patent Office, discover how to conduct an effective patent search and learn from the experiences of other entrepreneurs.
Forms of financing
As an innovative entrepreneur, you want to develop and market your product or service so your company grows. You may often turn to the bank for a traditional loan. But did you know there are other ways to finance your new product or service? Ways such as subsidies and schemes, crowdfunding, or attracting investors. It depends on your company and the product idea that suits you. If you ensure proper preparation so that you know the financing options, you have a greater chance of success in finding capital. Do you want to attract the attention of investors? Then, recording your intellectual property and investigating existing patents is very important.
Discover our 4 tips to protect your innovation:
Tip 1: Investigate all protection options
As an entrepreneur, you register your invention with a patent to prevent counterfeiting. But there are also other ways to protect your ideas:
- Patent law: for technical products or production processes.
- Copyright and neighboring rights: for texts, images, and performances.
- Trademark law: for logos, words (names), colours, sounds, and shapes of companies, products, and services.
- Trade name law: for the name of a company.
Read more about protecting your idea or innovation
Tip 2: Protect your intellectual property in time
It is often intelligent to consider intellectual property early in the innovation process. This is also evident from the European Patent Office (EPO) and the European Union Intellectual Property Office (EUIPO) research. Start-ups that apply for a patent or other form of intellectual property right (IP right) at an early stage are up to 10 times more likely to receive financing than start-ups that do not.
Practical example
Start-up Weco (the Wave Energy Collective) develops innovative solutions to produce electricity from ocean waves. The company is very aware of the importance of protecting its invention and attracting investors. Weco now has 2 patents.
“We invest a lot of time and money in developing our innovation, which is why we are happy that there is such a thing as intellectual property. It also gives investors the certainty that somebody cannot simply copy.”
Tip 3: Don't give too much away about the technique
Novelty is a requirement for a strong patent. So, the technology you want to protect with a patent may not have been made public before the date of your patent application. Not even by yourself. Therefore, be careful with the information you reveal to others, for example, in joint R&D with other parties, discussions with investors, or crowdfunding.
Crowdfunding is a way to raise money from the general public (the crowd). This is often done via online crowdfunding platforms, where people can invest in various projects or initiatives. This way, you receive immediate financing without going to banks or applying for subsidies. However, it is essential to pay close attention when using crowdfunding. Keyboard developer Wooting also experiences this importance.
“Our crowdfunding campaign was a great success. But we did show quite a lot of the functionalities of our keyboards. That made it difficult to protect our product with a patent. Crowdfunding provides capital investment for hardware development and creates a bond with our customers in product development. But we now remain focused on what we reveal in advance!"
Tip 4: Make collaboration agreements on time
Many innovations arise in partnerships. But for investors, it is often desirable that your intellectual property is well defined or, even better, that your company is the sole owner of essential intellectual property. That is why this point deserves attention from the start of a collaboration. Before the partnership, record the background knowledge of the parties: this is the knowledge acquired in advance or outside of the partnership. This knowledge, therefore, does not count as knowledge that falls under joint development.
Also, clear agreements should be made about the intellectual property of the knowledge acquired in the collaboration. This is the foreground knowledge: all knowledge and intellectual property built up in the context of the partnership. In addition to knowing who will be the owner, you determine who will access the foreground knowledge and what conditions apply.
Tip 5: Investigate whether you are infringing on the intellectual property of others
Freedom-to-operate (FTO) means that you can market your product or service without infringing on the intellectual property of others. Find out by having an FTO investigation carried out. The investigation is also fascinating for investors because they want to keep their risk as low as possible.
Foto van octrooiadviseur Yp Kroon
"An FTO not only shows investors that you are seriously considering your IP rights, it also gives them a risk analysis that makes them more inclined to invest in your innovation. Read all about it in my blog.”
Take a workshop on intellectual property
The Netherlands Enterprise Agency (RVO) frequently organises events, workshops, and webinars nationwide with various partners. View the agenda for an overview and register now (in Dutch).
Schedule an appointment with a patent advisor
Want to know how to use intellectual property smartly for your innovation? Which form of protection is best for your product or service? If you have specific questions about applying for a patent, please make an appointment with one of our patent advisors. In a personal conversation, they will answer your questions and give you tips on using intellectual property.
- Ministry of Economic Affairs
