1. Patents promote venture capital. The research result of "the role of patents in venture capital financing" shows that "patents are symbols of quality, which can promote financing and help enterprises achieve innovation". In 28, a research report titled "Patenting by

entrepreneurs: an intellectual

study" in Berkeley once again confirmed this result. The research results show that 67% of venture capitalists who support start-up companies believe that patents are extremely important for obtaining investment. Although only 4% of startups hold patents, 8% of venture capital companies have patents.

2. Patents can help startups defend themselves against the attacks of current rivals. Nest, a startup company in the field of smart home, just released its first batch of products-intelligent thermostat-and was accused of patent infringement by Honeywell

, a giant in this field. Analysts believe that Honeywell originally wanted to drive Nest out of the field by consuming each other's energy and restricting each other's resources through patented weapons. Unexpectedly, Nest was ready to apply for patents for its innovative products long ago (there may be hundreds of patents and patent applications eventually), and Nest also obtained 6 third-party patents related to its product line from Intellectual

Ventures, a patent giant in the United States.

Intellectual

Ventures, headquartered in Seattle, USA, is one of the most unpopular companies in the science and technology circle. This company has almost mastered the largest patent in the United States, is one of the top five patent owners in the United States, and belongs to patent speculators. These patents effectively consolidated Nest's intellectual property status. Although the lawsuit is still pending,

Nest successfully destroyed Honeywell's plan to expel it from the field. The reason why Nest was finally acquired by Google (mentioned in the seventh reason) is also an important reason.

3. Patents help to prevent more powerful competitors from stealing the innovation achievements of startups. In 1999, just 23 days after Amazon got the patent of "one-click" online shopping system, it was because of Barnes, a more powerful competitor at that time. Noble also used a similar system to initiate a lawsuit. The judge finally approved the ban on Barnes &;

Noble's ban on Amazon's "one-click" system makes Amazon gain an advantage in online book retailing.

4. Patents can ensure the free operation of startups.

although Google, as an industry giant, still suffers from patent distress today, as early as 1998, when it was a startup company, Google attached great importance to its groundbreaking Google webpage rating mechanism PageRank (patentNo.

6,285,999). Google didn't have a business plan, venture capital or even a domain name until it applied for this patent. After the patent was officially awarded to Stanford University, Google paid Stanford University $336 million in shares to buy an exclusive patent license. One analyst said that without that patent, Google might have been defeated by Yahoo, Microsoft and other cottage search engines that once dominated the market.

5. Patents can help startups increase their market share rapidly. The Spanish startup fractus S.A.

invented an antenna that can make the mobile phone smaller based on the principle of fractal geometry. Without this invention, our mobile phones would still be as big as shoes. But it is impossible to produce smart phone antennas with an annual sales volume of 1.5 billion by this Spanish company alone. So Fractus

S.A applied for this technology patent and sold it to 9% smartphone manufacturers in the world. In this way, patents not only protect its innovative technology but also expand its market share.

6. Patents can help startups to form joint ventures and research and development partnerships. A study by the National Science Foundation in 214 found that 49% of the production and service enterprises developed their own new products and services by using inventions outside their own enterprises, and 14% of the inventions came from startups. In most cases, the invention patents of these startups are the legal framework for establishing joint ventures and R&D cooperation.

7. Patents can increase the chances of startups being acquired. From the above point 2, we already know that Nest

uses its own patents to protect itself against the lawsuits of competitors. USA-Today quoted a well-known analyst as saying

"If Nest does not have substantial and valuable intellectual property rights, we believe that Google will not buy the company". It can be seen that the main reason why Google spent $3.2 billion to acquire Nest in 214 is that the company has many valuable patents.

8. Patents can help innovative enterprises prepare for Initial Public

Offering (IPO). Even when Facebook, a technology giant, was preparing for its IPO in April 212, it felt the need to pay Microsoft $55 million for 65 patents of former American Online. In the previous month, Facebook also purchased 75 patents from IBM

. Part of the reason for this was to deal with Yahoo's pending patent infringement case against Facebook. However, experts say that in view of the fact that patents are increasingly becoming a competitive weapon for technology companies, the more important purpose of Facebook's purchase of patents is to reduce investors' worries that Facebook may face legal risks due to patent infringement before the IPO, and at the same time make itself resist further lawsuits from competitors in the future. Shortly after the IPO, Twitter bought a similar patent from IBM.

9. Compared with startups without intellectual property rights, those with intellectual property rights live longer and gain greater market benefits. In 215, a study on the theme of "IPO performance supported by patents, innovation and venture capital" found that patents have a strong predictive effect on IPO performance supported by venture capital, and the IPO performance supported by patented venture capital is much better than that supported by non-patented venture capital. This also applies to the IPO performance supported by non-venture capital. In 27, a research report entitled "Patents and the Survival of Internet Enterprises" pointed out that companies without patent protection have little chance to survive.

1. Patents can help start a billion-dollar empire. Rupert, CEO of IPfolio (an intellectual property management software)? Rupert

Mayer recently observed that patents have helped at least 1 major start-ups to create billion-dollar imperial enterprises. These include Dropbox (a network folder synchronization patent for client software that can automatically synchronize files stored locally to the cloud server); The asynchronous challenge game patent of social game company Zynga; Patent of magnetic card signal decoding system and method of American mobile payment company Square; GoPro's patent for the strap system that fixes the camera to the user; Of course, there is Google's original valuable PageRank patent.

(Zhuo Yi Intellectual Property)