How to Create a Multiplier Effect with Patents

Takeaway: Patents add to a start-up’s strategic advantages. 

Beyond serving as a tool for start-ups to get investments and protect their products or services, a patent can serve a startup company in many other ways that can achieve a multiplier effect.

A startup may not be the best fit in certain markets that its patent can be used in and therefore, by having licensing agreements that may be specified by markets, a startup may lease out the technology beyond their own business models to create extra revenue.

A startup may consider franchising their business in a way that includes use of the patent and wherein the franchisor still has control as to branding and the overall business model but can quickly operate in different markets.

If the products protected under the patent can address secondary problems, the startup may consider eventually spinning off that can be completely separate entities or as subsidiaries.

A startup short on investments may form a business deal with a vendor for manufacturing a product and negotiating a limited license agreement with the vendor.