What do you do if you’ve got a patent, little money, and want to see who out there in the rest of the big wide world would be interested in buying it or licensing it?
IPEXCHANGE is a Hong Kong-based startup with an international team that aims to connect patent owners worldwide with others looking for the solutions the patents offer.
Its founder and CEO Hidero (Hidi) Niioka describes its purpose as being a global exchange for monetising IP, and wants to bring it to the attention of independent patent holders and innovative SMEs in New Zealand.
At a first blush and following a conversation with the Japanese-born, German-raised, globally-educated Hidi, IPEXC seems like it could be an especially good fit for countries like New Zealand – that is, smaller patent portfolio-holders wanting to get their ideas in front of larger companies and entities.
The company has done its market research (and has no doubt also been assisted by a pretty impressive looking team of advisers).
Among some of the findings, which will be no surprise to many Kiwi patent holders, is that most IP brokers and law firms will only work on a contingency basis (i.e. a successful sale percentage fee) for portfolios that contain a large numbers of patents. In addition, most law firms want a retainer of US$10,000 – $15,000 upfront.
Equally, a single patent owner approaching a large company will usually find it isn’t interested either.
“Up till now there’s literally been no answer for the ‘small fish’ such as individual patent owners and innovative SMEs, those with limited resources, or none at all,” Niioka says.
So how does it work? The patent owner uploads as many patents as they want for free. Neither the patent number nor enough information is provided via IPEXC for someone interested in the idea to circumvent the site.
Under the site’s business model, potential commercialisation agents (IP brokers, law firms, interested technology companies etc.) who want access to more of the patent information, and to connect with its owner, have to pay a subscription fee (which itself comes at two levels.)
Patent holders pay a success fee only. If there is a successful sale or licence of the patent, IPEXC receives a commission, which varies from 4 percent – 12 percent.
The company is also actively marketing patents, using its own trademarked and US patent pending Crowdlicensing aggregator, and bundles like patents to provide critical mass.
“This grouping creates a patent portfolio that is more attractive to potential commercialisation agents and gives more leverage to the individual patents in the bundle,” Niioka says.
Commercialisation agents or subscribed technology companies can view, licence and/or buy on this basis.
Niioka has also been successful in attracting the attention of national patent offices (Swedish Patent Office, Danish Patent Office, and the Japanese Patent Office as examples) in a number of countries, and providing links to IPEXC from their home pages.
IPEXC has designed its system to give patent holders control over how their patents are sold or licensed.
“What we’ve created is an example of Web 3.0,” Niioka says. “Much of the discussion and transactions can take place across our interface, interactively. It also means the patent owner retains full control of the process.”
Having been involved in business and academia intellectual property, Niioka says the purpose of three-month old IPEXC is to “create something useful for everyone”.
For countries such as New Zealand (and so far people from 55 countries have checked the site out), IPEXC offers a legitimate and credible way to make money from a good idea he says.
“Also, our global reach and multi-language functionality means that patents can be viewed and accessed by agents from all over the world, increasing visibility and chances of a successful transaction.”
In January, Chicago-based Steven Steger said that New Zealand businesses are completely ignoring the option of selling or licensing patents overseas,despite the fact there's big money to be made in patents.
IPEXC offers one way to maybe remedy that.