Patents are an important part of any company's portfolio, but for startups, there can be hesitance to take the necessary steps to obtain a patent for their creation. From cost concerns to the length of the process to the seeming urgency of other requirements, startup founders can cite any number of reasons to put off getting patents. But having patents provides real value to any venture at its earliest stages and beyond.
Having a patent early on can serve to bolster your case to investors looking towards future growth and development. The more patents or potential patents that you are able to show potential investors, the greater your chances are of being able to garner a strong valuation and attract quality investment offers. Short of having patents, you will have to demonstrate your company's value and plans to get a hold in the marketplace in other ways, which can be more challenging.
Holding a patent also serves its primary function of protecting you and your creation against copying and infringement. The vast majority of companies aren't looking to infringe upon the work of others, so having your work on file for reference allows other creators to see that you hold the patent before pursuing their own work that would infringe upon it. And while no company wants the expense and hassle of a legal case, having a patent allows you to pursue action against any parties that would violate your patent should that prove necessary.
For entrepreneurs looking to exit their company, holding patents increases the potential value of your business in the case of potential acquisitions. Those patents serve as the backbone of what you're doing and offer the potential for future revenue as they bolster the existing portfolio. More than any of your other existing assets, your intellectual property holds the greatest value to buyers as the foundation of what you've created.
As with all intellectual property registration, patents require an investment of time and energy and money that can be scarce in the nascent stages of your business. But the investment pays off in long-term value that your company can build on.