We are dependent on patents, which makes us keep an eye on the patent world. Here are four key finding from our most recent research
There has recently been some debate about patents on the Danish startup scene – are patents good or bad for innovation?
It’s no secret that we’re pro patents, as we see them as a valuable way to protect our assets. The debate nevertheless made us ask ourselves, if we had overlooked something.
We recently spend some time researching the state of patents, and while the arena is nowhere close to black and white (or easy to understand for that matter), we have a few finding, we want to share with you:
1) Patent sharks are not a problem. It seems.
Patents are on the rise in Denmark. In 2015 Danish companies applied for 9.453 patents – which equals to a 44% increase since 2007. Our main concern was, that a few, huge companies was applying for all the new patents.
A report from 2014 implies, that this doesn’t seem to be the case – that patents are fairly even split between companies of different sizes:
Size distribution among patent active companies in Denmark:
Big companies (250+ employees): 12%
Medium companies (50-249 employees): 24%
Small companies (10-49 employees): 26%
Micro companies (0-9 employees): 38%
NB! The numbers are from 2011, and they don’t take into account, if a company applied for 1 or 100 patent – just that they’ve applied.
Recent statistics aren’t available, and the numbers are very hard to get, as the patent applications are split between national-, regional- and global organs. But when we spoke to the Danish Patent and Trademark Office, they told us the numbers of patents granted are increasing, but they don’t have any reason to believe the patents are being accumulated in fewer, bigger companies.
2) Denmark is a very innovative country – at least patent-wise
This one might be most interesting for our Danish readers: Denmark is the fourth most innovative country in the EU compared to population when it comes to patents – only surpassed by Holland, Sweden and Finland.
Just from 2015 to 2016 there’s been an impressive growth in the number of patents granted to Danish companies: From 698 to 1033 – or a 48% increase. This is similar to the general trend within the European Patent Office, where the number of granted patents have increased by 40%.
3) China has exploded in the past decade
During the past decade China has been an increasingly important market for Danish patents: From 252 patents in 2005 to 1158 in 2015 – a 360% increase.
The Danish Patent and Trademark Office thinks the reason is, that Danish goods are highly appreciated by Chinese copyists, and therefore Danish companies has become increasingly aware of their IP in China.
4) Companies that own IP-rights are more profitable
Even though you’re small company – or maybe even because you’re a small – it’s important to protect your ideas.
Patents might not be the right way to protect yourself, but if it is, you should really prioritize to find the money for an application – even if it’s a hard and expensive pill to swallow for a small startup. It might very well be worth your time and money in the long run, as a EU-study from 2015 shows that companies with IP-rights are more profitable:
Difference in revenue per employee of IPR owners compared with non-owners of IPR:
Large companies: +4.0%
SMEs: +31.7%
Total: + 28.0%
Based on observations of a total of 130.555 firms.
