Early filing dates are almost always a bad thing, not a good one.
Many entrepreneurs are often lulled filing patent applications – especially provisional applications – because they are told that an “early effective filing date” is a good thing.
Patent attorneys who are anxious to lock in another client will push the Fear of Missing Out on an inventor/entrepreneur. Their pitch: “What if someone files the same patent tomorrow? You will lose everything!”
Patent attorneys love this pitch because it works. It works because it stokes a big fear in the inventor: that someone else will beat them to the punch.
In most cases, the notion of an ‘early filing date’ hurts more than it helps.
Your priority filing date actually works against you.
Almost all inventions take far longer than you expect to get to market. It just takes time to figure out product-market fit. Every entrepreneur thrashes around, trying different things, testing their product against customers, working on their marketing message, and finding the specific customer who will buy.
For most entrepreneurs, this process is frustratingly long.
Each day that goes by is another day closer to the end of the patent term.
At the beginning, a 20 year patent term seems like forever. But as an entrepreneur spends one year, then another, then another trying to get product-market fit, it is very common for 5, 10, or even 15 years go by before the big break.
An ‘early filing date’ often means that you will need to do continuation applications. Continuation applications are additional patent applications from your first one. The tradeoff is that all of the continuation applications in the patent family must expire 20 years from that ‘early’ filing date.
In this situation, time is not on your side.
When looking at patents to collateralize loans, we routinely see portfolios that have been pending for 10 years or more. These continuation applications will issue with half (or more) of their useful life already used up. This is where the ‘early filing date’ can become a boat anchor.
I want the last invention, not the first.
When there is no product-market fit, my preference is *not* to get the first patent on the ‘grand idea,’ but to get a patent on the last invention.
I want the patent that captures why a customer buys a product.
For every startup, we don’t know why the customer buys until we go through the tortuous process of trial and error. We speculate and hypothesize why our product is useful to a customer, but we don’t really know until the customers start buying.
During the product-market fit phase, we try all kinds of things, but the most important is to identify the reason why the customer buys the product. If we can figure that out, we can duplicate the sale over and over.
The single, most valuable, most hard-fought piece of intellectual property is to uncover why someone bought your product.
If I can get wrap a patent around that feature or set of features, I can the most effective moat around the business. Every other patent on other ideas, especially the ‘grand idea’ of the business, is almost pointless.
When does the priority date really matter?
An ‘early filing date’ is often a good thing when the inventions are ‘small’ and represent just a minor change to existing products. These patents can be sold or licensed by independent inventors. But these ideas are only as valuable as the small improvements that they make.
Grand idea patents – those that envision a product/service that is a big improvement over existing products – often take a good bit of investment to get the product to market. These patents fall into bucket of not having enough data to support the investment.
The ‘early filing date’ was a good idea – before 1995.
You may eventually get a United States Patent application by filing a provisional application. However, the patent law changed in 1995 which dramatically changed the value of an “early filing date.”
Before 1995, the patent term was guaranteed to be 17 years from date of issue.
After 1995, the patent term changed to be 17 years from date of issue OR 20 years from the earliest filing date, whichever was shorter.
This law fundamentally changed the strategy from filing ‘early and often’ to being far more judicious about what was in the patent application and how to select inventions for patenting. Before, the best strategy was to put everything you knew into a patent application, because every word in the specification helped you. After the change, every word in the specification hurt you.