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Patent Monetization Strategies - Patexia IP Matters Webinar

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Patent Monetization Strategies - Patexia IP Matters Webinar

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There's A LOT to learn about how to best monetize patents. How do you decide between either selling or licensing patents? How should a patent owner think about this important decision? What are the most current strategies for this issue?

Peter Kim is an expert in monetizing patents. He's is a principal at Irvine Pointe and former Director of IP Strategy at Rambus. In this installment of the IP Matters web series, he'll provide 20-minute coverage of key issues in patent monetization.

There's A LOT to learn about how to best monetize patents. How do you decide between either selling or licensing patents? How should a patent owner think about this important decision? What are the most current strategies for this issue?

Peter Kim is an expert in monetizing patents. He's is a principal at Irvine Pointe and former Director of IP Strategy at Rambus. In this installment of the IP Matters web series, he'll provide 20-minute coverage of key issues in patent monetization.

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Patent Monetization Strategies - Patexia IP Matters Webinar

  1. 1. 1Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved.6/13/2013 “But even though we may understand on some level that loss is a catalyst for growth, most people still believe it to be the opposite of gain and to be avoided at all costs. If I’ve learned anything in my years of practicing Zen and coaching basketball, it’s that what we resists persists. Sometimes the letting go happens quickly; other times it may take several sleepless nights. Or weeks.” - Phil Jackson (11-Time NBA Championship Coach), “Eleven Rings: The Soul of Success” “He who works his land will have abundant food, but the one who chases fantasies will have his fill of poverty.” - Proverbs 28:19 Source:Barnes&Noble Patexia Webinar Series “Deciding Between Either Selling or Licensing Patents” Peter Kim, Principal, Irvine Pointe Advisory, LLC peter@irvinepointe.com
  2. 2. How to Seek Advice 6/13/2013 Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved. 2 “Never ask a barber if you need a haircut” - Warren Buffett Image Source: http://www.biography.com/people/warren-buffett-9230729
  3. 3. Question: Why is patent licensing so hard? 6/13/2013 Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved. 3
  4. 4. Frequently Heard from CEOs/Owners • My idea/patent is being used by entire industry • The target licensees are dragging their feet • Their technical/legal arguments don’t make sense • Dealing with their lawyers is frustrating • I just want to sit down and reason with them • I’m being very reasonable; numbers are conservative • Don’t they know I’ll sue them if they don’t pay? • The amount I’ll settle for is so tiny • Another inventor (with worse idea) made money 6/13/2013 Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved. 4 http://www.imdb.com/title/tt1054588/
  5. 5. Question: Is selling my patent same as “selling out”? 6/13/2013 Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved. 5
  6. 6. Patent Owners (Particularly Inventors) Are Different From Owners of Other Assets • The idea/patent is “my baby” • I want to see my idea adopted in marketplace • I just want to be made whole for them stealing idea • I’ve worked so hard and waited so long already • I’ve spent so much money, need to break-even • No one else knows my invention as well as me • No one else could work as hard on this as me • I don’t trust other people to maximize value • If I sell it, they’ll low-ball me 6/13/2013 Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved. 6 http://news.discovery.com/human/life/inventors- killed-by-inventions-101001.htm
  7. 7. Question: How do I evaluate selling vs. licensing? 6/13/2013 Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved. 7
  8. 8. This is My Decision … • … but am I stuck on these factors? – How much of my money spent so far (“sunk cost”) – How much of my time spent so far (“sunk time”) – How frustrated I feel about the experience (“revenge”) – How reasonable I am vs. what I deserve (“discount”) – How brilliant and innovative my idea was (“attachment”) • Why is this important? B/C no one pays for these. • Is it possible to look forward, rather than look back? • Most inventors cannot, which impairs their outcomes 6/13/2013 Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved. 8
  9. 9. 6/13/2013 Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved. 9 Sell My Patent to a “Big Guy in Trouble” 1 Patent 1 Patent 5 Patents $100M $400M $500M $300M $100M Cross-Licensing: f(A, B) = -$300; f(A, C) = $0 Here is why my patent is more valuable to someone else
  10. 10. Trust My Partner Do These Lead to Trust? • Investment Cash • Operating Capital • Expertise • Track-Record • Credibility to Licensees • Reputation Have I Considered? • Ideal Client Profile Fit • Personal Chemistry • Client Management • Confusing Expenses • Conflict-Resolution • Partner’s Encumbrances 6/13/2013 Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved. 10
  11. 11. Which decision will make me happier? 6/13/2013 Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved. 11
  12. 12. 6/13/2013 Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved. 12 "And that's why sometimes a bird in the hand is better than two birds in the bush and sometimes two in the bush are better than one in the hand." - Warren Buffett “The Snowball: Warren Buffett and the Business of Life” Presented at Allen & Company Sun Valley Conference (1999) http://en.wikipedia.org/wiki/The_Snowball:_Warren_Buffett_and_the_Business_of_Life
  13. 13. Looking for Resources • Understand the nature of conflicted advice • Trusted Advisor: – Another owner who licensed patents – Owner who sold patent (ask for broker refs) – Licensing person, not currently in business • Visit LES conferences – Ask lots of questions – Usually people try to help 6/13/2013 Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved. 13
  14. 14. 6/13/2013 Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved. 14 “I would rank Peter’s presentation as one of our best ever.” * “Peter leveraged his extensive industry contacts, deep expertise and experience to guide us through different licensing and IP management options.” * “The client feedback from that meeting was excellent.” “His background is unique, which gives him a unique perspective on patent trends.” * “… intimate knowledge of the ways that non-practicing entities think and operate is an invaluable asset”. * “… his ability to … take the chaos and make sense of it -- and provide a comprehensive analysis.” Further Details @ http://www.irvinepointe.com Irvine Pointe Advisory, LLC: Sample Testimonial Excerpts
  15. 15. For further information: peter@irvinepointe.com Peter Kim Principal Irvine Pointe Advisory, LLC www.irvinepointe.com Q&A Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved. 156/13/2013
  16. 16. 6/13/2013 Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved. 16 Industry Perspective from Leaders in IP Licensing & Patent Monetization Trusted Intellectual Property Advisor
  17. 17. 6/13/2013 Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved. 17 Broad Range of Experiences Acquisition • Deal Negotiation • Patent Broker Relationships • Terms & Conditions “Pitfalls” Mining • Portfolio Segmentation • Subject Matter Expert Recruiting • Searching (keywords, class codes) Licensing • Claim Chart Development • Royalty Forecast and Valuation • Market and Value Chain Research Invention • Co-Inventor: 17 U.S. issued patents • Brainstorming and Ideation • Claim Drafting Strategy

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