Knowing the value of intellectual property

Almost 300 years of development since the start of industrial revolution underlines there's no shortage of ideas in the UK; and, of course, they're a vital part of business evolution. Then, watch any episode of Dragon's Den and you can quickly see how hard it is to tell a good idea from a stinker.

So how can you tell if an idea or product is worth the (often huge) cost and resources needed to develop it and take to market. Even if that's clear, how do you make sure nobody rips your idea off and beats you at your own game?

The first step is to consider your intellectual property rights (IPR) scientist and ideas development specialist, Danny Connaughton, suggests. "Again, watch Dragon's Den and the first question they ask is 'have you got a patent?'"

The economic value of Intellectual Property Rights is in constant flux. Which makes it an important issue for many. So it's crucial to ask certain questions. Such as, is this idea cheap or expensive to produce? Can the investment in the R&D be recouped?

"There's no incentive if you aren't going to get anything back," states Danny. "You have to start by looking at market potential. But, only 20% of ideas ever work. There's a more than average failure rate. That's important to know."

His advice? "If there is a big potential for those products then protect your Intellectual Property (IP). If the market is small (less than £200,000 profit) then look more closely at the cost of maintaining the protection against the market potential [which is a more difficult thing to look at]."

Thankfully, there are places to seek advice and support.

At Connautech, Danny protects IPR by acquiring development funding. "We are a consultancy that supports new ideas particularly in the field of the radical innovation of new technology. I recently directed a bid from an SME for DTI Smart funding (now called GRAND) which allowed the SME to carry out an 18-month project in which significant IP was generated."

With development costs so high support is also needed from regional agencies. "A client had an idea for a compact plasma cutting machine to cut sheet metal," begins Danny. "We applied for a Smart award, ensuring it met all the requirements e.g. innovation, market potential etc. and they won £45k over 18 months to develop the concept. This allowed him to get on a Small Firm Loans Guarantee Scheme where he was loaned £60k."

Securing investment

The next step was to develop a high-profile presence, to attract customer or investor interest. "After two years at the Bolton Technical Innovation Centre they owned all the IP with the option of trading some of that for equity investment," says Danny.

The value of products lies in the amount of invention, innovation, research, design and testing involved. It gives you the right to prevent others from using your inventions, plus being able to negotiate payment in return for others using them.

Danny believes that if the UK is to compete with foreign economies it is vital that businesses protect these. "It's important if we want to compete abroad. We need to be at the front end. After all, innovation is developing new ideas and making them profitable."

If you want to find out more on IPR the links on the right lead to organisations which offer support.