How do you know if your company has an IP strategy? A basic IP strategy widely used by startup companies is “Critical Feature Denial”. In brief, this strategy requires that you identify at least one, and preferably several, critical features necessary for a competitor to compete with the company and then obtain IP that denies a competitor the opportunity of using these features.

Of course, IP strategies can be far more complex and interesting than this basic strategy. For some companies, this basic strategy is not very useful. However, most companies, if they do not even have this strategy in place, often have no strategy at all. An added benefit of focusing on this strategy is that many investors consider this to be “the” IP strategy.

The Critical Feature Denial strategy describes a conceptual chain that links the market, to the feature, to the criticality of the feature, to the IP “protecting” the feature and blocking any useful alternatives. Since IP is usually used together with other business moves, this basic IP strategy should also identify what other business moves work with the IP to achieve this denial. The chain must be solid:

(a) Any gap will be used by the competition to find a way into the market

(b) Worse – if a patent is filed and published, the competitor will use the teachings of the patent to find and penetrate the gap, perhaps with better overall results

The strategy statement

Here is the strategy condensed into one sentence:

“To succeed in market X you need Y. Our patent/application Z prevents others from doing Y because W and that has competitive value A because B. Z cooperates with process C that we are also doing (optional).”

Spread out into components:

  • The market is ____
  • ____ is a critical feature required to be competitive in any part of the market
  • We assert that doing the critical feature gives this value ___ relative to all the alternatives for reason ____
  • We assert that a patent (or other IP) on ___ prevents any reasonable way of providing the above feature or its alternative because you need to be able to do ___ and we stop you from doing that
  • We assert that the feature is made more critical because of some other thing ____ we do (optional)

Why is filling out this statement useful?

When you write out the statement you make certain assumptions explicit. More important, you also make clear the links in the chain, so the gaps are more visible. Be aware that this exercise may cause you to rethink your business strategy, or at least refine it, so it can take advantage of what IP can do for you and avoid a strategy with a fatal IP weakness.

Overview of the process of creating your personal IP statement

(a) Fill out the statement template, in order, by defining all the variables

(b) Identify gaps and places where you are vague – this is a job for a devil’s advocate, who can, for example, emulate the competitor (real or potential)

(c) Fix what needs to be fixed

(d) Repeat

It is important to stress that one must not be vague. One useful technique is to start with relatively narrow definitions (e.g., of the market) and after there is one working statement, expand. For startup companies, one can define the market as the “wedge” market the startup is planning on (if so). In fact, the most common mistake is defining the “market” in such broad terms that it is not possible to find IP that can be expected to block a critical feature in the market.

A toy example

Imagine you are the founder of an automotive technology company. You have developed a smart fuel injection pump. How do you link this invention to your business case? The following could be a starting point. Not an exciting statement, but as we iterate, it will improve.

“To succeed in the market for automobiles you need an internal combustion engine. Our patent/application #1234 prevents others from using an internal combustion engine because these require fuel pumps and our patent covers all types of fuel pumps and without a fuel pump there is no reasonable way to control the varying needs of fuel flow to the engine. Patent #1234 cooperates with the process of educating users to want fast-response accelerators (that we are also doing).”

A bit more detail

We can spread out the statement as follows:

  • The market is ____
    •  There needs to be a match between the specifics of the market and what you bring to the table – you may need to redefine the market – or your feature
    • Note: “market” is the client’s “job-to-be-done”, not your specific product
    • Is the market all automobiles? Also EVs?
  • ____ is a critical feature required to be competitive in any part of the market
    • Make sure investors and competitors agree it is “critical”
    • Do EVs have internal combustion engines? Need fuel pumps?
  • We assert that doing the critical feature gives this value ___ relative to all the alternatives for reason ____
    • Are alternatives satisfactory? Does the customer care?
    • Systems with pressurized fuel, might not need a fuel pump, but a valve
  • We assert that a patent (or other IP) on ___ prevents any reasonable way of providing the above feature or its alternative because you need to be able to do ___ and we stop you from doing that
    • Here you not only define the IP, you also explain how the IP does the denial
    • IP can also be non-patent IP, such as trade secrets
    • Some gaps here are clear – automobiles do not need internal combustion engines and then do not need fuel pumps
  • We assert that the feature is made more critical because of some other thing ____ we do (optional)
    • EVs have very fast response accelerators without fuel, so the other activities (marketing/pushing fast acceleration) might not be benefiting the protection we plan on getting from the IP

After filling it in – iterate!

An improved statement

Iterating, based on the above comments might lead to the following result:

“To succeed in the market for gasoline sports automobiles you need an internal combustion engine with a fast response. Our patent/application #1234 to fast feedback fuel pumps prevents others from providing a fast response because fast response requires fast changing of gas flow and feedback to avoid flooding and you need a feedback-responsive fuel pump for this. Patent #1234 cooperates with the process of educating users to want fast-response accelerators (that we are also doing).” (yes, fuel injection cars can also flood due to high pressure)

More details can be found in this presentation.

About the blogpost author:

Maier Fenster is the head of the medical device department at Ehrlich & Fenster, of the Ehrlich Group. He specializes in startup companies and multi-disciplinary inventions. His current IP passions are combined IP/business strategy and improving the state of IP understanding by business people. IP can be a great equalizer for the little guy and it is a pity it is not used more; he hopes to change this. Every other week he publishes on LinkedIn (and YouTube) a talk on an IP subject, as part of #IPTechTuesday. He is happy to talk about IP to any audience.

Formally, he is an Israeli patent attorney and a US patent agent with nearly 30 years experience in the field and holds degrees in Physics, Mathematics and Computer Science. As the Israeli market is relatively small, he has an international outlook when drafting and prosecuting. His credo is that the job of a patent attorney is to help the client understand what their invention might be, and, more important, figure out what IP can do to help their company succeed. He is also an inventor on 40+ patents.