The US Patent Process – a Huge Roadblock to American Entrepreneurship and Small Business

CapsulePen (in which I am a major investor) is a brilliant breakthrough product in the pill case industry, but got hampered by the huge cost of the patent process.

CapsulePen (in which I am a major investor) is a brilliant breakthrough product in the pill case industry, but got hampered by the huge cost of the patent process.

I decided to designate January, 2016 as my “rant about something in my blog month,” but I will also offer solutions. I have a series of three such blogs planned for January, this one being my second. Do feel free to link back to my first blog in this series, “My Issues with Corporate Procurement and Supplier Diversity Professionals.”

In this blog I will complain about how the US Patent Process can easily kill and bankrupt a small business. Yes, there are many small business (like my consulting practice or opening a restaurant or boutique store) for which the patent process is irrelevant, but for start-up businesses around a totally new product or invention or process, the patent process can completely ruin them.

I do have some experience as a major investor in an innovative product in the pill case industry. I wrote about it a little in a blog back in September, 2012. By far the largest expense was going through the patent process. I am saddened that as an investor in an entrepreneurial pursuit, that a huge portion of my investment had to go to extremely highly paid patent attorneys making $750 per hour.

CapsulePen (link) received several rave reviews from the trade and business press; too bad the costly patent process hindered it from coming to market.

CapsulePen (link) received several rave reviews from the trade and business press; too bad the costly patent process hindered it from coming to market.

Any process that requires large amounts of high paid attorneys is broken! Yes, major corporations with multi-million or even billion dollar research and development budgets can easily foot $100,000 to push a patent though the process, but this could quickly bankrupt a start-up company. The US Small Business Administration provides support and tools for budding entrepreneurs, but in this area they fall far short. And I have heard members of President Obama’s administration speak eloquently about how small businesses are the backbone of the American economy, yet the US Administration burdens us with this arduous costly process.

So as large companies get bigger and lawyers get rich, small businesses die.

What do I recommend? The Small Business Administration should establish a simpler fast-path cost-effective process that does not require attorneys to complete. And perhaps the SBA can even provide some legal support at no charge to assist start up companies and small entrepreneurs. If small business are indeed the backbone of the US economic recovery, then remove this tremendous road block that only large companies now afford.