A well-functioning crystal ball? It’s not the first thing you’d expect a successful tech entrepreneur to suggest for start-ups facing the ‘patent or not to patent’ question. But Longtail UX Managing Director Andreas Dzumla laughingly recommends it, given the fast-moving and inherently disruptive nature of technology businesses.
'With patents, it’s such a tricky thing when it comes to web services, or technology in general because there are so many different ways to approach the same challenge. On the one hand we knew what we were doing was unique, and needed protection. On the other hand it’s really hard to know how much your product is actually worth.'
Andreas sharpened his instinct working stints at Google and within dotcom agencies and ecommerce businesses. It was these instincts which told him there was a gap in the market for more cost-effective search functionality for products and services.
The product he and co-founders Will Santow and Chanon Srithongsook developed is a software as a service (SaaS) that analyses businesses’ product and services content, existing web structures and the search behaviour of their customers. The Longtail UX SaaS then identifies where that content isn’t readily discoverable to customers, creates useful pages to cover those gaps and then integrates them within the existing web structure. Essentially his company provides a deeper, more effective search experience for a business’ customer without the expense of completely re-designing the consumer website.
What was the IP strategy?
Andreas says his business had no IP protection strategy from day one. In fact, when the business started thinking about patents, it was more a case of looking at a patent's usefulness as a marketing tool.
'At the beginning we used it almost as a marketing instrument. When you start out and you don’t have large clients it’s actually an advantage to say ‘we have this unique proprietary technology and we have a patent pending on that’. It changes the conversation. It gives it credibility, so in the beginning that was important.'
As the business grew and started collecting clients, the nature and importance of patent protection changed.
‘There comes a phase where the marketing aspect isn’t so important. You have clients, people are looking at your client portfolio and case studies. But then at a later stage someone might want to buy us, or you’re talking to potential investors. Suddenly having a patent has a much higher value again. It’s an interesting cycle – at the beginning it’s more about marketing, but at a later stage it might become something much more substantial.’
DIY or a patent attorney?
Five years and two rounds of the patent process, and on the verge of expanding into Europe, the US and Asia, Andreas was clear on the value of using an experienced patent attorney through the twists and turns of the process.
'I think it’s a hard thing to get your head around all the different patent processes across all the industries. You spend so much money on one thing, and you only have one chance. You’re getting written opinions back from Europe and it doesn’t make any sense to you! Having a patent attorney onside helped a lot. The money we spend on them versus the costs of the patent itself, and the opportunity costs of doing it wrong? I think it’s money well spent.'
Patent protection and tech start-ups
When asked for what advice he’d give a tech start-up on investing in patent protection, Andreas says ‘If you have something unique you should always try to do it if you can control the costs. The big challenge will come if someone infringes – the cost of getting a patent approved versus what you’d have to pay then to defend your IP! It definitely helps with R&D grants and capital raising, because it supports that you’re actually doing something unique.’
But he also says with hindsight he’d have done a few things differently at the start of the process.
'I think the biggest challenge is this – you start the application process, the whole thing takes about 18 months ‘til you finalise – and you may be improving or changing your product in that time. In hindsight I would have been much more general at the start and just removed stuff as we developed the product until we were ready to do the final application.'
And, he says, getting as much information and advice as early as possible is a must.
'I probably would have sought out more information, attended more information meet-ups and stuff like that. Compared to the amount of money we put into developing the technology, a patent is not that expensive – as long as we don’t have to defend it! It’s definitely worth it.'