Lumenci for Venture Capitalists

Patents can increase the value of the portfolio companies and improve their likelihood of success

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Why should a VC care about Patents?

Simply put, patents increase the likelihood of a positive outcome.  Gornitzky & Co. write that startups with strong IP positions were six times more likely to become 'winners' than 'losers' for the investing VCs. Further, an MIT report states that founders who registered in Delaware and acquired a patent and trademark protection were "278 times more likely to achieve an equity growth event than firms that are associated with none of these choices."

 

Also, the data show that patents matter a lot to valuation. Stout reports that a paper by Professors David Hsu and Rosemarie Ziedonis examines the degree to which patents enable entrepreneurs to acquire financial capital across the new venture life cycle. The authors conclude that having more extensive patent application portfolios increases the likelihood that entrepreneurs attract initial financing from venture capitalists.

24%

Increase in valuation after doubling the patent application portfolio of a new venture

$12mn

Upward funding-round adjustment after doubling the patent application portfolio for the average startup in the sample

To be successful with patents, VCs need to address these issues:

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Education

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Strategy

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Invention Identification

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Patent Filing

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Timing

Lumenci Deliverables for VCs

Lumenci's patent experts team helps your portfolio companies leverage small investments in time to create patents intended to support their business objectives.  Our services include:

 Patent Co-creation

Our team has experience working with innovators to identify the broadest possible inventions, including inventions in adjacent technologies.  We can also suggest inventions related to their work, and our clients own 100% of the inventions created.

Patent Mining

We assign an experienced invention expert to work with your teams to identify and document critical innovations in your portfolio firms. We work with their legal team (or one of our partner law firms) to secure the broadest patents possible, all while minimizing their time investment distraction.

Patent Acquisition

Especially for more mature startups, it can be strategically beneficial to develop a robust defensive patent portfolio quickly by acquiring patents from third parties. Our team of valuation experts identifies the patents we believe meet their needs and negotiate on your behalf.  And to avoid tipping off their competitors, our clients remain anonymous until the transaction is ready to complete.

Pre-Investment Patent and Invention Valuation

As you consider a potential investment, understanding the value of existing patents and patents pending allows your firm to determine the proper valuation. Also, Lumenci further assesses the prospect's potential to file patent applications on technology not yet patented.  Recognizing such untapped patent potential gives your firm additional insight before you decide to invest.

Patent Valuation & Landscape Analysis

Concerned about what competitors to your portfolio companies are doing?  We provide a thorough analysis of public patent data relevant to your main competitors, and, working with your IP legal team, we can provide a thorough, technical assessment of existing patents.

The Next Step...

Schedule a 1-hour meeting with your senior business and technology executives to discuss our 3-stage process.

STAGE 1

Invention Creation and Identification

(1-3 months)

STAGE 2

Invention Development

(1-3 months)

STAGE 3

Patent Filing

(4-6 months)

The Deliverables...

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Education

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Strategy

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Invention Identification

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Patent Filing

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