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Patents and venture capital funding for startups

On Behalf of | Dec 8, 2016 | Business Litigation |

For entrepreneurs in Florida wanting to get their new ideas and business ventures off the ground, finding ways to fund their operations can often be one of the biggest challenges. Quite frequently, the clock is ticking giving startups little time in which to prove their concepts successful or close their doors. Obtaining patents may well be one of the best ways that a startup can get the financial backing it needs to get through the startup phase.

IP Watchdog explains that while some patents only provide short-term protection, that may be all that a startup needs. The fact of the matter is that patents do expire but for a startup that’s not necessarily a problem because if the business can get through the first few years and become established before the patent runs out, it may not longer need the protections granted by the patent. In this way, adopting a short-term view is not necessarily a bad thing for a startup.

Forbes confirms that the simple act of holding a patent may well open up the door to many venture capitalists that would otherwise remain closed. A patent can provide a venture capitalist the security it needs to feel confident in making a specific investment.

A study done at Berkeley showed that while more than one-third of startups had patents, more than three-fourths of startups with venture capital funding had patents. This confirms the benefit that a patent may hold in obtaining that very valuable and much-needed financial backing to get a new business off the ground.



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