- Posted by lawyeradmin
- On July 12, 2017
There has been a rather large point of contention within the business community over the potential for strong patent protection’s efficacy in helping to lift America’s economy back to levels seen before the economic recession or the housing bubble collapse
On one side of the debate sits those that would decry the stifling of innovation and creativity that can arise from abuses of patent rights, and to their claims that there have been a few cases in which less than scrupulous business owners and lawyers have engaged in predatory practices while hiding behind the protections afforded to those holding patents.
Though instances of abuses are certainly among the minority of patent statistics, media outlets have pushed those instances continuously through the news cycles as they are more exciting than instances in which patents function as intended. Regretfully, this serves to mask the true contribution that patents have to job growth.
On the other side, there are those that see patents’ potential for not only job growth but a boost felt throughout the entire economy. For those that choose to see strong patent protections set in place as a necessary component to an economy that rewards true innovation, there is a growing list of backers who have begun to echo their claim.
Job Growth within the Start-up Community
One sector has found itself particularly intertwined with this debate.
The market in which small start-ups thrive has become the front line for this debate and certainly the best proving ground for both sides to state their case. As young start-ups can often serve as a litmus test for many factors within not only a market but within an industry as a total, much of the evidence in support of strong patents comes from this sector.
As America’s economy has started to shift focus towards small businesses and start-ups, many of the newly created positions within the country come from within the sector, making start-ups and small business one of the best possible opportunities to revitalize the economy while increasing job growth.
But one unique factor to start-ups has caused many to see the benefits behind the case for strong patent protections…
As many start-ups generally lack the necessary financial resources to enter the market, they often are forced to seek initial funding either through traditional business loans and venture funding, though the last several years have seen a steep decline in the amount of start-ups who receive funding this way, or by approaching venture capitalist firms.
Regardless of which route a start-up takes, both sources of financial backing need strong evidence for potential success before taking the risk. This is where strong patent protections play a critical role, as often VCs and banks will look for the protections and rights set in place for a startup’s intellectual property as a measure for how well they will do once they enter the market. With weak protections set in place, VCs and other traditional sources of financial backing will generally pass on a potential start-up irrespective of how much they like the startups’ concept and management team, cutting any potential for job creation short before it even begins.
But by ensuring that strong patent protections procedures are in place, not only will the start-up sector continue to thrive, but in the wake of its success, America will reap the benefits of lower unemployment, higher rates of job creation, and of course a much needed boost in confidence to our business sector.