Startups Party at the Patent Office

Software startups have traditionally avoided patenting their innovations, viewing it as an unneeded expense that can eat up $15,000 or so. “We thought about it, because there’s definitely some patentable stuff,” says Brett Martin, the chief executive officer of New York’s Sonar, which makes an app that helps people connect with strangers. “But we’re busy trying to build a business.”

Yet many who aspire to build the next Facebook are learning from the mistakes of their guru, Mark Zuckerberg. His company was unprepared for the battle that erupted when Yahoo! sued in March for infringing 10 patents. Soon after, Facebook purchased 750 patents from IBM and spent an additional half-billion dollars on part of the AOL patent portfolio recently bought by Microsoft. Meanwhile, Apple, Google, Oracle, and other tech giants are locked in patent lawsuits.