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Patent filing costs and equity

What's the typical cost for filing a patent? Would you give up equity in exchange for the attorney fees, if the attorney is offering this option? How much equity is reasonable for an early stage start-up? Can you recommend a good patent attorney?

15 Replies

Labhesh Patel
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Labhesh Patel Entrepreneur
Chief Data Scientist at Abzooba Inc.
Hi Kristina,

Patent filing costs vary significantly from firm to firm. I have paid anywhere from $15K to $1.5K for a full patent filing. I should qualify that by saying that in the case when I paid $1.5K, I wrote significant portions of the full patent. I think a typical range would be $4K-$5K.

If you are an early stage start up, you might want to consider whether you need a full patent right now. You might be able to get by with a provisional which is significantly cheaper. The provisional will give you one year before the full patent is due - basically you get the priority date of the filing day of the provisional. In one year, you get a lot of clarity around product which is way more important than the actual patent. And this is coming from someone who has filed 175 patents and has 120 issued patents from the USPTO. :)


Ronan Levy
0
0
Ronan Levy Entrepreneur
Entrepreneur, Advisor, Lawyer
I echo Labhesh's comments. Your first question should be: is this actually something worth patenting? Even if you meet all the criteria for a patent (i.e. novelty, non-obviousness, utility), if a patent is not core to your business strategy and competitive differentiation, then it may not be worth the effort and cost of patenting.

Any lawyer with his or her salt (and there aren't that many who are) should be asking you that question first: does it actually make sense to patent this for your business? If he or she doesn't, then look for a new lawyer as the first one isn't doing you any justice by not truly understanding your needs.

I can recommend a great patent lawyer in Toronto, if helpful. Otherwise, I'm happy to ask around for recommendations in San Francisco. (FYI, in addition to my entrepreneurial pursuits, I'm still a qualified lawyer.)

Ronan
Kym McNicholas
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Kym McNicholas Entrepreneur
TV Host, Tech Jounalist, Director of Extreme Tech Challenge, Host of KDOW Radio's NewFocus On Innovation
I love Royse law. 1/4% I think is fair for equity. Sent from my iPhone
Nadia Shalaby
1
0
Nadia Shalaby Entrepreneur
Entrepreneur
hi Kristina, i had a company where i had written most of the patent "spec" myself, and got "consulting" help for "Draftsmanship" since the figures (especially in mechanical and physical engineering and sciences) need to adhere to a very specific drawing style, and there are people who do this for a living. Having said that, in another company, because the scale of our envisioned product and market size was in the billions, we were able to obtain a deferred fees arrangement with our attorney firm of choice (all the ones we interviewed had given us this offer, deferred fees to up to $20,000). So I would not recommend discussing any equity arrangements, but rather a clean deferred fees arrangement. It worked out well, and everything was paid retroactively after the conclusion of the first institutional round of funding.

Also note that when there is a limit on the spending, the attorneys are more motivated to do things inexpensively, file provisional, keep the number of claims to the standard number prescribed by the USPTO, etc.
Mitchell Portnoy
0
0
Mitchell Portnoy Entrepreneur
Healthcare Information Executive
You can file a provisional patent for a few thousand dollars, but it could cost you $20,000 or more to file for a utility patent which might not include filling costs in the US or outside the country. Equity is tricky but should in few cases be more than a few percent. Many entrepreneurial law practices will accept equity as payment (but there is a limit), especially in Silicon Valley. Mitchell Portnoy [removed to protect privacy]
Ranjit Sawant
0
0
Ranjit Sawant Entrepreneur • Advisor
Product Management and Marketing at Vaayoo Inc
I dont think you should be giving *any* equity to a patent attorney. If you are a early stage start-up, with little money, dont waste it by engaging a patent attorney at this stage. Even if you engage one, you will do most of the work, they will just add legal verbiage. I learnt it the hard way after spending around 20K on patent. My recommendation would be to file a provisional patent using website like LegalZoom. They charge $180. It will give you 18 months of time before you file the utility patent. Plus your claim and priority date is the one from Provisional.

regards,

Ranjit Sawant
Founder , http://www.vaayoo.com
Got Ideas!! Launch startups with no upfront costs and minimum risk.
cell: [removed to protect privacy]
[removed to protect privacy]
George Arison
1
0
George Arison Entrepreneur • Advisor
Making car buying, selling, and ownership a delightful experience
Check out https://www.upcounsel.com/, pretty easy to find great attorneys at reasonable costs there.
John Duffield
1
0
John Duffield Entrepreneur
Sr. Manager, Interactive Program Management at SapientNitro
Sam herting is an IP attorney in silicon beach. Great and affordable. Happy to make personal intro. I use him for my business. Sent from my iPhone
Rashad Bartholomew
0
0
Rashad Bartholomew Entrepreneur
Business Development at PassCash
Kristina,

I have a great patent attorney, if you would like a referral.

Best,
Rashad
Colin Bester
0
0
Colin Bester Entrepreneur • Advisor
President at Bester Designs
Kristina I echo many of the folks who replied to your question. I would suggest that firstly you look closely at why you believe you need a patent and then decide on what you need as there are options besides patents for protecting your work. BUT, you do need to understand steps to take to ensure you can patent down the road when/as required.

If you are not familiar with IP protection (note I didn't say patents) I'd rather recommend you spend the money on a consult to familiarize yourself on do's and don'ts and then make a call.

As to your question, No, I'd generally not offer equity to a lawyer for patent filing, but I also accept this is a general response made without understanding product, motivation, requirement etc.

I have always found technical IP lawyers very helpful and willing to discuss the next step - the good ones know that they are also in the marketing business and they want to secure future business.

Good Luck!
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