Patent Monetization Strategies - Patexia IP Matters Webinar

1Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved.6/13/2013
“But even though we may understand on some level that loss is
a catalyst for growth, most people still believe it to be the
opposite of gain and to be avoided at all costs. If I’ve learned
anything in my years of practicing Zen and coaching basketball,
it’s that what we resists persists. Sometimes the letting go
happens quickly; other times it may take several sleepless
nights. Or weeks.”
- Phil Jackson (11-Time NBA Championship Coach),
“Eleven Rings: The Soul of Success”
“He who works his land will have abundant food, but the one
who chases fantasies will have his fill of poverty.”
- Proverbs 28:19
Source:Barnes&Noble
Patexia Webinar Series
“Deciding Between Either Selling or Licensing Patents”
Peter Kim, Principal, Irvine Pointe Advisory, LLC
peter@irvinepointe.com

How to Seek Advice
6/13/2013 Copyright © 2013. Irvine Pointe Advisory, LLC. All Rights Reserved. 2
“Never ask a
barber if you
need a haircut”
- Warren Buffett
Image Source:
http://www.biography.com/people/warren-buffett-9230729

Question:
Why is patent
licensing so hard?

Frequently Heard from CEOs/Owners
• My idea/patent is being used by entire
industry
• The target licensees are dragging their feet
• Their technical/legal arguments don’t make
sense
• Dealing with their lawyers is frustrating
• I just want to sit down and reason with them
• I’m being very reasonable; numbers are
conservative
• Don’t they know I’ll sue them if they don’t
pay?
• The amount I’ll settle for is so tiny
• Another inventor (with worse idea) made
money
http://www.imdb.com/title/tt1054588/

Question:
Is selling my
patent same as
“selling out”?

Patent Owners (Particularly Inventors) Are
Different From Owners of Other Assets
• The idea/patent is “my baby”
• I want to see my idea adopted in marketplace
• I just want to be made whole for them stealing
idea
• I’ve worked so hard and waited so long already
• I’ve spent so much money, need to break-even
• No one else knows my invention as well as me
• No one else could work as hard on this as me
• I don’t trust other people to maximize value
• If I sell it, they’ll low-ball me
http://news.discovery.com/human/life/inventors-
killed-by-inventions-101001.htm

Question:
How do I evaluate
selling vs.
licensing?

This is My Decision …
• … but am I stuck on these factors?
– How much of my money spent so far (“sunk cost”)
– How much of my time spent so far (“sunk time”)
– How frustrated I feel about the experience (“revenge”)
– How reasonable I am vs. what I deserve (“discount”)
– How brilliant and innovative my idea was (“attachment”)
• Why is this important? B/C no one pays for these.
• Is it possible to look forward, rather than look back?
• Most inventors cannot, which impairs their outcomes

Sell My Patent to a “Big Guy in Trouble”
1 Patent 1 Patent 5 Patents
$100M
$400M
$500M
$300M
$100M
Cross-Licensing: f(A, B) = -$300; f(A, C) = $0
Here is why my
patent is more
valuable to
someone else

Trust My Partner
Do These Lead to Trust?
• Investment Cash
• Operating Capital
• Expertise
• Track-Record
• Credibility to Licensees
• Reputation
Have I Considered?
• Ideal Client Profile Fit
• Personal Chemistry
• Client Management
• Confusing Expenses
• Conflict-Resolution
• Partner’s Encumbrances

Which decision
will make me
happier?

"And that's why sometimes a bird
in the hand is better than two
birds in the bush and sometimes
two in the bush are better than
one in the hand."
- Warren Buffett
“The Snowball: Warren Buffett and the Business of Life”
Presented at Allen & Company Sun Valley Conference (1999)
http://en.wikipedia.org/wiki/The_Snowball:_Warren_Buffett_and_the_Business_of_Life

Looking for Resources
• Understand the nature of conflicted advice
• Trusted Advisor:
– Another owner who licensed patents
– Owner who sold patent (ask for broker refs)
– Licensing person, not currently in business
• Visit LES conferences
– Ask lots of questions
– Usually people try to help

“I would rank Peter’s presentation
as one of our best ever.”
*
“Peter leveraged his extensive
industry contacts, deep expertise
and experience to guide us through
different licensing and IP
management options.”
*
“The client feedback from that
meeting was excellent.”
“His background is unique, which
gives him a unique perspective on
patent trends.”
*
“… intimate knowledge of the ways
that non-practicing entities think
and operate is an invaluable asset”.
*
“… his ability to … take the chaos
and make sense of it -- and provide
a comprehensive analysis.”
Further Details @ http://www.irvinepointe.com
Irvine Pointe Advisory, LLC:
Sample Testimonial Excerpts

Industry Perspective from Leaders in IP Licensing & Patent Monetization
Trusted Intellectual Property Advisor

Broad Range of Experiences
Acquisition
• Deal Negotiation
• Patent Broker Relationships
• Terms & Conditions “Pitfalls”
Mining
• Portfolio Segmentation
• Subject Matter Expert Recruiting
• Searching (keywords, class codes)
Licensing
• Claim Chart Development
• Royalty Forecast and Valuation
• Market and Value Chain Research
Invention
• Co-Inventor: 17 U.S. issued patents
• Brainstorming and Ideation
• Claim Drafting Strategy

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