IP-this and IP-that … how do you define IP-rich?

There it is again. 

This time it was in a year-end interview in the Financial Post.

“Bains called the $250 million a “down payment”, suggesting more money is coming.  The pledge was intended to give him additional flexibility to invest in “IP-rich” companies.”

Bains went on to say “We’re focusing a lot on developing IP”.

OK that all sounds good, but what does IP-rich imply?  What does it mean?  I have explored this idea before.

In 2018, an article in the Globe and Mail about Waterloo’s Smarter Alloys commented “ … IP will give [the] company a big edge”.  One might infer they were IP-rich, or at least on their way, at the time of writing.  In February 2020, after receiving $4.5 million in funding from SDTC, I took a second look at Smarter Alloys’ patents, and thought about what one might want to see for IP to give a big edge.    

“…one might look for patents that are central to the application; patents that will protect any advantage the system might provide.  … any patents will be more valuable if the basic technology i.e. generating electricity using shape memory alloys, is advantageous, such as providing higher efficiency compared to other technologies in the waste heat-to-energy space.”

A few month’s later BDC announced their IP-backed funding envelope.  The term IP-rich was used to describe the type of company of interest for their IP-backed fund.  They also mentioned IP-potential.  These two concepts go hand-in-hand as IP-potential is needed for a company to be IP-rich.

What sort of patents might lead to IP-rich companies? I wrote:

“Patent potential suggests the technology and solutions will lead to a large number of patents.  In such cases one would likely be working at a fundamental level of a technology, such that many levels of development … are possible.  Solving a “small” problem in a peripheral bit of technology does not meet the criteria.”

And, how can IP-potential be identified?

“A combination of deep technical knowledge in the company’s field and patent experience is needed to identify “patent potential”.  The technical knowledge is key, as the analyst has to see the field, the particular technology and where the two might go in the future.”

Any focus on IP is laudable.  However, proper execution of these initiatives will take work and will require the right tools be in place.  One of these tools is understanding the technology, because the technology must have potential for any patent to have potential. Let’s not miss these opportunities and allow IP initiatives to be relegated to the “trending”  category.