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patenting rates

Parajet – the flying car and patents

by Andrew Watson on 12 November 2008

A flying car has been a goal of engineers and The Jetsons fans alike for a number of years now. The Times has a story (“The Flying Car” – 9 Nov. 2008) about the SkyCar – a working (and inexpensive) design based around “paramotors”. These giant fans get strapped to your back and when added to a parachute-like airwing, you can take off flying: a much more practical way of flying than by jetpack.

The SkyCar, a product of UK-based Parajet Ltd, uses paramotors strapped to a vehicle as a way to achieve flight. The car is street legal and its inventors will be taking it on a bio-ethanol fueled challenge to drive it from the UK all the way to Timbuktu, including across the English Channel and the Strait of Gibraltar.

It looks like from the article that they’ve taken a bunch of existing technologies and innovated around them in really interesting ways, including a motorcycle engine modded to run on bioethanol and a snowmobile transmission:

“The fan’s static when you’re driving around,” says Cardozo [the primary inventor at Parajet]. “The engineering challenge was getting a really reliable system that will switch power between wheels or fan.”

I instantly wondered if they had taken steps to protect their invention, such as through patenting, as we’ve actually seen quite a few UK-based start ups and other companies who “under-patent”, often based on the conception that patenting requires ground-breaking, award winning science. In actuality, combining current technologies in interesting ways can also be patentable. I did a quick search on esp@cenet and didn’t find any in the company’s name, though with an 18 month window between application and publication, this isn’t surprising. Of course rather than underpatenting, they could forgo patenting in order to create a new market for paramotors that anyone can participate in.

This story serves to highlight two themes I’d like to return to regularly:

  1. Do UK companies patent less than comparable companies in other jurisdictions, and if so, why?
  2. What are the strategies around opening up innovation and how do they work?

Most certainly, a discussion to be continued…

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Scottish funding trends in the downturn

by Andrew Watson on 5 November 2008

Over the weekend the FT ran a piece on a recent report by Scottish Enterprise on the risk capital market in Scotland Scottish start-ups could face funding gap. The highlights:

  • Angel investors are moving to a “cradle-to-exit model”, thus changing the more standard model of angel-to-VC;
  • Overall investment in 2006 and 2007 went up (£85m to £114m) but investments in start ups went down (45 deals at £15m to 10 deals at £2m); and
  • Last year 32 deals were university spin outs and formed 29% of risk capital at £30m.
  • “[A]s the size of deals increase in re-investment rounds, the available capital for investment in new companies is reduced and so new start-up companies are facing a struggle.”

I’m wondering (naturally) what the trends mean for IP in these companies. As funding becomes tighter, generally the IP position of a target investment company would be looked at in more depth by VCs (as would all other areas).

If trends move towards angel investors staying in longer without other investors, I would also think that the lack of “fresh blood” in the company (and accompanying diligence reviews) might mean that IP could stay a neglected issue. The diligence process is often a time (or the only time) when the IP situation at a company get looked at in any detail. Investors already committed with a company might engage in the IP end of the process less stringently.

Also in light of my recent focus on patenting rates, I note the article also discusses ITI Scotland‘s investments:

In the year to March, ITI Scotland invested a further £11.3m to launch three new research and development programmes – bringing its total funds committed to £134m across a portfolio of 25 R&D programmes. The innovations from these have led to the filing of more than 130 patents to date.

While the importance of patents to some businesses can’t be understated, patents aren’t the only form of IP protection nor are they the best indicator of innovation – companies can quite sensibly forgo patents for trade secret protection or be innovative in ways that aren’t patentable. It’s a nice number to have (especially for a newspaper article), but it deserves some expansion.

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