Patent Investors: Everything You Need to Know
Patent investors provide funding for inventors so that they can turn their idea into a reality.3 min read
2. Pitching and Protecting Your Invention
Updated July 10, 2020:
Patent investors provide funding for inventors so that they can turn their idea into a reality. Finding an investor, however, requires having an original idea and the ability to pitch this idea successfully.
Finding Investors for Your Invention
If you have an idea for an invention but don't have the money to make your invention, you could look for patent investors. Before you can find an investor, however, you need to take several steps to prepare for your search. The first and most important step in finding investors for your potential patent is searching the United States Patent and Trademark Office (USPTO) website to find out if your invention idea is original.
Once you're sure that your invention is unique from ideas that have already been patented, you will need to think about what you'll be asking of your investors. Obviously, you'll want them to provide you with money so that you can work on your invention, but you also need to know the end goal for your invention.
To prevent your idea from being stolen by a potential investor, you should make sure that you file a patent application. Correctly filing for a patent will give you legal protections for your invention, including the ability to prevent other people from using your idea without your permission. Marketing is a big part of finding patent investors, so it's vital that you have a strategy for making your invention attractive to possible sources of funding.
A variety of funding sources are available that investors can take advantage of, including:
- Angel investors
- Investment groups
- Invention clubs
- Venture capital firms
When you're developing a strategy for marketing your invention to investors, you should be aware that you will also need to market yourself. Investors will typically only give their money to an inventor with whom they believe they'll have a good working relationship, so you need to present yourself well when pitching your invention.
The best way to tell investors about your ideas is by using a business plan. A business plan can help you organize a strategy for your invention and can help investors see why they should provide you with funding. You need to show potential investors why your invention has value and your plan for marketing your invention to the public once it has been created.
Pitching and Protecting Your Invention
Finding investors is the best way to finance the launch or creation of your invention. Some inventors may seek investors with only an idea, meaning they have not actually started the process of making their invention, which can include:
- Filing a patent application
- Engineering the invention
- Developing a prototype
- Creating a proof of concept
While investors can help with the costs of developing an idea, inventors also need to be sure that they protect their idea from theft.
For instance, if you haven't taken steps to protect your idea, an investor could listen to your pitch, steal your idea, and then create your invention on their own. You could request that investors sign a nondisclosure agreement, but they are unlikely to do so before hearing some basic information about your invention.
If you want to protect your intellectual property, you should either wait to pitch your idea until it has gained patent pending status or insist on a nondisclosure agreement. Waiting to pitch until you have established patent pendency for your invention is the best way to protect your right to your idea.
You can establish patent pendency by filing either a provisional patent application or a nonprovisional patent application. Whichever type of application you choose, you'll need to include a variety of details about your invention, including its benefits and information about how it works. After patent pendency has been established, you can pitch your idea to investors without worrying that it will be stolen and commercialized. Because you were the first person to file the patent application, you will also receive first rights to the idea.
The drawback of this option for protecting your invention is that the cost of filing a patent application can be as high $20,000. If you're already struggling to fund your invention, it's likely that you don't have enough money to cover these patent costs.
If you need help finding patent investors, you can post your legal needs on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.