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Can I still get angel or venture investment if I finance my patents?

Our due diligence reports are highly respected by investors. BlueIron’s due diligence process not only evaluates patentability, but also enforcability, the economic advantage of the invention, its value to the startup’s market, as well as its value to competitors. Solid business value is REQUIRED before BlueIron can finance the invention, and BlueIron’s due diligence reports…

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What is the buyout cost of a financed patent?

The buyout cost for a patent is set up front and will not change. The buyout is NOT a percentage of patent value, revenue, or any other measure. We do not take warrants, “success fees,” or any type of carry. Our job is to build Investment Grade Patents for you, not become a tax on…

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Is it better to own my patents rather than lease them?

Financially, a startup’s cost of capital is extremely high – especially at the beginning – so every dollar needs to be spent wisely.  Leasing or renting assets is much more capital efficient. Most startup companies lease office space and even lease furniture through a coworking space.  They lease computer services through Amazon Web Services and…

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Can I enforce my patents while they are being financed?

Yes! Just like leasing a car, you have full CONTROL of the IP assets without having to pay the full price up front. Because you have an exclusive license, you – and only you – decide how to use the patent assets. You can enforce, license, sublicense, cross license, or sell your business assets. BlueIron…

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What is the legal structure of patent financing?

The legal structure is a convertible note, lease-back structure. The IP assets are held in a Special Purpose Vehicle (SPV), which is how virtually all of the Fortune 500 companies hold their IP. The SPV grants an exclusive license to the startup with a buyout option. The startup can exercise the buyout option at any…

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What is the effective interest rate of a patent loan?

In general, the effective interest rate for a patent loan will be in the neighborhood of 12-18%. The patent loan insurance product has a premium that is paid out of the loan proceeds, as well as due diligence fees and insurance premiums for the required enforcement and defense insurance. When you include interest that is…

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Is the patent loan program available to pre-revenue companies?

We prefer to provide loans to revenue generating companies, but we will consider pre-revenue companies in some cases. The loan program is a loan, after all, and we will evaluate your company to see if we believe that you will be able to repay the loan. Taking out a loan is much different than selling…

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What is included in a patent loan?

A patent loan will come with several other components, including insurance for patent enforcement and patent defense. Because a patent loan is specifically designed to help you expand your business, we want you to focus on generating revenue, not litigation. Therefore, we require that you maintain at least $2,000,000 in patent enforcement insurance and patent…

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What are the requirements for a patent loan?

The patent loan program requires several items about your patents and your business plan.  This is not a complete list. 100% ownership of your patents. Your patents must be completely unencumbered and must be owned by the operating company.  Some investors will attach liens to intellectual property, which is a non-starter.  In many cases, the…

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