By Neil Thompson, Patent Agent & Writer
You have an invention idea and you apply for a patent application. But what if someone has already patented that idea? All your hard work has been in vain. You wouldn’t have had this problem if you had done a prior art search before filing the application, though.
A prior art search is a search for all patent applications and patents that are related to your invention idea. There are companies whose sole job is to do prior art searches. They have access to databases from around the world and can provide you with a list of patent applications and patents related to your invention. A patent practitioner can take that list and look through all the applications and patents and see what they claim. If he thinks that your invention can claim something that’s different from what’s claimed in the list, then your invention may be patentable.
There are some patent practitioners who do their own prior art searches. They most likely don’t have access to all the databases and tools prior art search companies have access to, though. Going through a company that routinely does prior art searches will likely give you a more comprehensive list. The bigger the list is, the less surprised you’ll be by the patent examiner looking over your application. The examiner will do his own prior art search and come up with his own list. You want your list to match his list as much as possible. By having access to more databases than a patent practitioner, a prior art search company is your best bet of your list matching up with the examiner’s list. You’ll be more prepared if the examiner issues a rejection of your application based on a document on his list.
If your application is likely to face rejection, wouldn’t you like to know that beforehand? Doing a prior art search before filing an application can save you a lot of money in patent practitioner fees, filing fees, and other fees. A typical prior art search can cost around $500, but don’t skimp on this step. $500 early on trumps thousands of dollars of fees later on.
This article was previously published at http://www.neilithompson.com/. Thank you to Neil Thompson, patent agent & writer, for sharing with our SDEE community.
San Diego Entrepreneurs Exchange is proud to co-host the Hera Venture Summit on September 17, 2016. This one day event will feature panel discussions, keynotes and interactive sessions to inform and connect female entrepreneurs and investors. Highlights will include tips from Barbara Bry (Blackbird Ventures), Kim Kovacs (Golden Seeds SoCal), Regina Bernal (USD School of Business Administration), Lorine Pendleton (Pipeline Angels), Tyler Jensen (The Startup Garage), Trish Costello (Portfolia), Felena Hanson (Hera Hub), and Silvia Mah (Hera Labs & Hera Fund),
Hera Venture Summit
When: Saturday, September 17, 2016 : 8:30 am - 7 pm
Where: University of San Diego, SoLES auditorium
Attendees: Entrepreneurs, Investors and aspiring angel investors who want to invest (resources, time and money) in women.
As a SDEE member, you will receive a $40 discount, just enter promo code SDEE40off when you register. For more details, please visit http://www.heraventuresummit.com/.
SDEE will be exhibiting at the Hera Venture Summit. Stop by our table to hear about our upcoming events and member news.
Hope to see you there!
June 23, 2016 Workshop: Perfect Pitch – For Creating and Delivering Winning Presentations
by Neil Thompson, Patent Agent & Writer
Does the idea of pitching an investor make you want to…abandon that idea? If so, you’re not alone. The pitch workshop, hosted by SDEE on June 23 at Hera Hub, was packed with people wanting to know how to perfect their pitch. Here are 10 tips from the experts. Specials thanks to our panelists Jeff Friedman (Tech Coast Angels), Larry Fromm (Achates Power), Diane West (2Connect), and Grace Chui-Miller (Correlation Ventures) for their nuggets of wisdom.
- Get the audience’s attention within the first minute (Larry says you have one minute to grab investors’ attention before they tune out. Facebook photos won’t scroll through themselves after all. Larry also says that if you have an hour for the pitch, do it in 20 minutes, leaving the rest of the time for Q&A.)
- Tell the audience a story (Diane understands that investors need data to make an informed decision about your company, but she implores people who are pitching to couch that data in stories. Kids like stories. Adults do, too.)
- Know your audience (According to Diane, the story that the pitch audience wants to hear will vary. The technology-minded will want to hear a technology story. The business-minded? A business story. Find out beforehand who will be in the audience to tailor the story to the audience.)
- Be honest about challenges (One of Jeff’s pet peeves is presenters that say they have no problems. There are always issues to overcome. Be honest about them. The investors, if they choose to take you on, may be able to help.)
- Focus on your strengths, not your competitors’ weaknesses (Larry is immediately turned off by pitch presenters who disparage the competition. Chances are the pitch audience knows your competitors and all their warts. Focus on the benefits of your product and how it addresses the problem you’re solving.)
- Don’t claim that you have no competitors (When she hears a pitch presenter say there is no competition, Grace thinks either the pitch presenter didn’t do his homework or is lying to make his product seem more novel. Acknowledge the competition. It makes you seem more knowledgeable of the market.)
- Don’t include financial models with dramatic increases (If you’re a pitch presenter, do you have a slide in your deck that resembles a hockey stick, rising uniformly over a 10 year period then leveling off? Ditch that slide. Grace believes that 2-3 year financial projections are the best a pitch presenter can reasonably estimate. 10 years? 15 years? No way.)
- Always have backup slides with more detailed information on hand (In Jeff’s group at Tech Coast Angels, the pitch audience is often mixed. For example, a scientist may have technology-related questions, so have slides available that would address them. Don’t present those slides unless asked, especially if the majority of the audience is not science or technology savvy.)
- Be confident, not arrogant (Diane’s view is that there’s a fine line between confidence and arrogance. The line consists of listening. Confidence is quiet. Arrogance is loud. Listen to learn the audience’s needs. Accept feedback.)
- Don’t try to get married on the first date (Larry is adamant that the purpose of a pitch is to start a conversation, not end it. Investors don’t typically write a check at the end of a pitch. The pitch is to get the pitch presenter to the next phase of the investors’ selection process. Hopefully, closing the deal will come soon enough!).
Neil Thompson is a writer, patent agent, and notary public among other things. You can read his musings on his blog “I’m not an expert. I’m just a guy who likes to think about stuff…” at neilithompson.com.
by Amy Duncan, Goldfish Consulting, Inc.
San Diego Startup week is an innovative weeklong conference that seeks to build an ecosystem of entrepreneurship in San Diego, provide resources for entrepreneurs, and amass a network of like-minded individuals to discuss common issues and share experiences. This year’s conference included a Bio/MedTech track with 15 events. I attended five of the Bio/MedTech sessions, held at the Sanford Consortium for Regenerative Medicine in La Jolla. Three of the sessions reverberated themes that included teams, partnerships, and licensing that I’ll cover in this blog.
Speakers and Panelists
Participants in “Starting a Biotech Company - JUST DO IT!!” included founders/CEOs Julio de Unamuno from LabFellows, Thomas Hitchcock from Xycrobe Therapeutics, Inc., Paul Laikind from ViaCyte, Zachary Zimmerman from Forge Therapeutics, Inc., Curt Becker from Molecular Assemblies, and Tim Mullen from Qusp Labs. Participants in “Licensing IP from UCSD and other Research Institutions” included Scott Forrest from BlackThorn Therapeutics, Paul Roben from UCSD, and Zachary Zimmerman. Participants in “Biotech Partnerships and Joint Ventures” included Greg Mckee from CONNECT, Jay Lichter from Avalon Ventures, Damien McDevitt from GSK, and Elizabeth Schwarzbach from Sanford Burnham Prebys Medical Discovery Institute. Participants in “What Biotech Investors Look For When Funding Startups” included Julio de Unamuno, Kara Bartone from JLABS, Stephen Connelly from BioMed Ventures, and Ron Shigeta from Indie.bio.
Building your Team
When de Unamuno asked whether the panelists preferred having loyal or independent team members, the founders unanimously agreed that loyalty and trust are fundamental. The panelists advised working your network to get recommendations for first hires, and that while having a rock star team member was clearly beneficial, they are difficult to lure. Founding team members are either senior level and in a financially secure position to take a pay cut and try something new, or desperately in need of a job. Once you build the lab and foundational data, you can leverage these assets to attract higher quality employees and prune those that don’t fit. The panelists underscored the value of people first, referencing the adage, “It’s about the jockey, not the horse.”
Bartone said one reason startups fail is when founders try to start a company part time, in off hours, or with no full-time employees. She said it’s hard to move a company forward this way. It was echoed throughout the track that few professors make it as a CEO straight out of the lab, and are typically unsuccessful at trying to be CEO and do the science at the same time. Panelists advise professors starting companies to find a business partner and maybe a post doc to run the science. Shigeta says his accelerator, Indie.bio, won’t invest in sole founders, citing that an entrepreneur needs to be able to talk at least one other person into joining them.
Being Coachable and the Ability to Pivot
In the early days of your startup, Shigeta says it’s common that no one knows anything about you, you have no track record, and you are your only asset. Investors look for “coachable” bright people who can take advice and step away from the science and be product focused. Shigeta encourages entrepreneurs to share their vulnerabilities and be open. Connelly underscored the importance for entrepreneurs to understand their technology as a product, where it fits, how it addresses an unmet need, and how it will move the needle. Bartone added that cheaper, me too, or slightly better won’t cut it. Shigeta said the product has to be spectacular. That being said, the final product probably won’t end up how it was initially envisioned. Being able to recognize when things aren’t going right and being able to pivot is critically important. All the panelists agreed that companies typically end up pivoting and pursuing different directions, further supporting the notion that you need a good, solid team to persevere.
Partnering with VCs and Biotechs
Typical VC firms are small with about four or five people. Getting time with a decision maker is hard to do. Lichter advises finding someone in the VC’s network and convince them to make the introduction. When you see a VC at a networking event, even if you’ve met before, Shigeta says the VC likely won’t remember who you are. Always be clear on who you are and be ready to deliver your quick pitch again.
The best way to establish a biotech partnership, according to McDevitt, is to talk to the people in business development at the company. Forrest and Bartone both raised the notion that you need to do your research on what areas and types of companies VCs and biotechs are interested in partnering with and investing in. For biotechs, they advised that you do your homework to understand their therapeutic focus areas and make sure your technology applies. Reinforce how your technology plays in their picture; indicate if it’s a new direction for them, a supplement or add on to an existing area, or how it grows one of their current franchises. Position your company on the role it will play for them, and how it will contribute to their growth, so they can pitch it internally. For VCs, know how much they are looking to fund. Know how much funding you need, based on the size of your team and phase of development.
Connelly says missing a good deal is what keeps VCs up at night. They don’t have a lot of time, so prepare a one-pager that describes your mission, the problem you are addressing, your proposed solution, how it’s different, how you plan to create value, the market size and non-obvious opportunities, and brief bios on the management team. Potential partners can look at the data later if they are interested. If there is interest, you’ll likely get invited to a follow on meeting covered by a non-disclosure agreement (NDA), but don’t feel pressured to reveal proprietary data. Even the VCs don’t want to open themselves up to liability.
If the investment community says “no” Connelly advises to be sure to understand why. Understand how each VC operates and what the motivations are. From a venture fund perspective, it’s all in the timing on how much money they raised and where they are in deploying the funding. If they just raised $100 million, they may want to fund an earlier/risky stage. If they’ve already deployed it and have some left over, they may not want to come in early and stay in the game long term. They may not have the money or buy in from their partners at that time. You may have to come back when the timing and funding is better, or when you have more data. But don’t stalk.
When it comes to universities and research institutions out-licensing technology Forrest and Roben said their strategy was to ensure their technology can succeed. Institutions wanting to safeguard their technology is the focus of the licensors’ program, not a small part that can be shelved or thrown away. They want to license to the partner “who’s going to love their baby the most.” The universities and research institutions are looking to partner with a team that has a plan, commitment and passion, and can execute. Forrest says it takes about 30 seconds to determine if the person is serious, experienced, and has a plan to take the IP forward.
Zimmerman noted that startups interested in licensing a technology typically want to test it out and see if it has legs, but can’t pay a lot of money for it, and investors aren’t interested in giving 5% to the university. To address this conundrum, he drafted up a letter of intent to obtain exclusive access to the university’s technology for 12 months. Zimmerman used the letter of intent as a tool to raise the seed round, which ultimately was used to pay the license fee, without giving away part of the company.
Finally, identifying the IP you want to license is not an exercise in simply reviewing a catalog of what’s available. Forrest said entrepreneurs need to either already know the professor behind the patent or be familiar with the area and understand its impact.
Words of Wisdom
Lichter said to plan for things not to go right, and that 95% of things we start will fail in this industry. Shigeta says that while you most likely will lose all of the investment, lose it responsibly and not painfully. Hitchcock said there will be anxiety starting a company, there’s no other way around it. The best way to diffuse stress, Mullen advised, is through talking about issues with the team. Laikind suggested that if an entrepreneur needs a support group, maybe that entrepreneur is not up for the task. Fortunately, there are conferences like San Diego Startup Week, organizations (SDEE, CONNECT and Biocom) and incubators/accelerators (JLABs, Indie.bio and Lichter’s COI Pharmaceuticals) to help entrepreneurs network, meet advisors, and establish a network of support to tap into along the way.
A Snapshot of the 10x Medical Device Conference
What do you get when you take medical device enthusiasts from across the country and abroad and place them in a scenic location for three days in sunny San Diego? The 10x Medical Device Conference. In its fourth year, 10x is the annual networking event of LinkedIn’s Medical Devices Group. The event, which took place May 2-4, 2016 at the Courtyard San Diego Airport, is the brainchild of Joe Hage, a medical device marketer with a penchant for bringing people together. On the first day of the event, conference goers were treated to workshops, a keynote speech, and the manufacturers’ showcase. In the morning, attendees heard from consultants Robert Packard, Nancy Knettell, and Maren Nelson about the intricacies of a 510(k) FDA submission. The 510(k), required for class II medical devices, shows that a medical device is safe and effective for human use. Knettell particularly spoke about software documentation requirements for a 510(k) submission. “Your software is a death dealing X-ray,” Knettell quipped, reiterating that even though software isn’t implanted in the body, its documentation is just as important as that of an implantable device.
Medical device reimbursement was another workshop topic. As insurance costs skyrocket and insurers become stricter on what they will cover, reimbursement is now more important than ever. Nicholas Anderson, an analyst at Intermountain Healthcare, explained that many product manufacturers do a poor job at showing clinical utility, which insurers require to pay for a medical procedure. Anderson explained that in the case of one product, only one in 58 patients benefits from the treatment. If the insurer pays $600/treatment, that’s almost $35000 in costs to the insurer!
During the afternoon session, attendees learned about neuro sales and marketing strategy. Mike Sperduti, the workshop’s facilitator, is a serial entrepreneur who has sold two companies. He teaches people how to approach potential customers to generate greater sales. Sperduti advised attendees to focus on customers’ communication styles. Visual, auditory, kinesthetic, and digital communicators must be approached differently to get their attention and sell to them. For instance, according to Sperduti, digital communicators want to see clinical data, independent reports, and white papers before making a sales decision. Auditory communicators are swayed by testimonials from those they trust. Sperduti even told the audience about language to use when addressing different communicators. For auditory communicators, he suggested using words that connote sound, like “I’ll talk to you later,” “Does that sound good to you?” and “I hear what you’re saying.” If you don’t know the communication style of the person you’re contacting, use all of them!Read more
An interview with Kimberly Davis King, co-director StartR and mystartupXX programs, Rady School of Management UCSD
by Amy Duncan, Goldfish Consulting
A veteran in the world of venture capital, Kimberly Davis King now focuses on investing and mentoring startups and high growth companies. With academic credentials that include a BS in industrial engineering from Stanford University and a MBA from the Harvard Business School, Ms. King is currently a lecturer at the Rady School of Management at University of California, San Diego (UCSD) where she also co-directs the student accelerator programs, StartR and mystartupXX, among other leadership roles and non-profit board positions she holds through the San Diego community.
The Rady School of Management is an ideal environment for Ms. King. While this graduate-level business school offers an MBA as well as other business degrees, the MBA curriculum places a special emphasis on issues faced by innovation-driven companies. Its signature program is called Lab to Market (L2M), a year-long course series that teaches students how to perform market research and feasibility studies, and develop a business plan and go-to-market strategy. “After that experience many of those students want to start their own companies,” said Ms. King. “But they are still going to school or working other jobs and often not able to get into traditional accelerator programs.” In 2013, a group of students identified this gap and suggested that the Rady School have their own accelerator program. The Dean asked Lada Rasochova, PhD, and Ms. King to help start StartR.
StartR is a free, non-profit accelerator program for Rady students and alumni designed to provide entrepreneurs tools to start and grow their businesses. The program includes workshops, mentoring, advice, and access to other resources for early-stage companies. At the conclusion of the six-month program, teams present their pitches at Demo Day, attended by investors and industry experts in the San Diego community.
“Every six months we have a cohort of six teams that go through the StartR program,” said Ms. King. “They come in with the idea, and we help them get their business off the ground. They incorporate the company, raise money, and many have generated revenue.”
Two stand-out companies that completed the StartR program are Aira.io and Alpine Labs. Aira.io uses Google glass-like technology worn by the blind that connects to remote agents who provide assistance in navigating the world around them. They’ve raised over $2.25 million in venture funding and have the product in beta-testing. The Alpine Labs product, Michron, allows affordable time-lapse photography using common DSLR cameras. The company has had three successful Kickstarter campaigns, recently raising $1.2 million, the highest amount any UCSD group has raised on Kickstarter.
The mystartupXX program was created by Dr. Rasochova and Rosibel Ochoa, PhD, from the von Liebig Entrepreneurism Center at UCSD. “They created mystartupXX to encourage female entrepreneurship in technology,” said Ms. King. “During the nine-month program, participants attend workshops on team building, leadership, market assessment, market research, creating a value proposition, validating business models, and understanding financing strategies needed to launch the business.”
One notable company that completed the mystartupXX program is Cypher Genomics, founded by Ashley Van Zeeland, PhD. Cypher Genomics enables scalable, automated genome interpretation of next generation sequencing data for diagnostics development and biomarker discovery. The company was acquired by Human Longevity in November 2015.
“We welcome SDEE members to become involved with StartR and mystartupXX,” said Ms. King. “Only one member of the management team needs to be a current Rady student or a Rady alumni to participate in StartR.” A great way to meet Rady students and entrepreneurs is to attend Demo Day on March 30, when the StartR teams present their pitches. Both programs have a competitive application process to select participants. The Spring 2016 StartR program closes on April 10th. The next application period for mystartupXX is the Fall 2016. To learn more about StartR and the Demo Day, click here. To learn more about mystartupXX, click here.
It’s that time of year again. Tax day (April 18) is approaching. Get your receipts ready and your tax preparer on speed dial! Want some tips to make your life a little easier? Here you go.
- If you're a solo entrepreneur with assets (house, car, etc.), consider changing your company’s designation from a solo proprietorship to an LLC or an S Corporation so that your personal assets are separated from your business ones, offering more protection for the former.
- If you are an LLC, consider filing your tax returns as an S Corp so that you can get some tax breaks. For instance, if you’re a shareholder of an LLC that files its taxes as an S Corporation, your distributions are not subject to employment tax.
- If you have hefty quarterly payments and are struggling to pay them, consider asking for a payment installment plan that you can handle.
- The IRS only goes back 3 years for tax audits. Keep your papers 5 years to be safe. Gone are the 7 years recommended in the past.
- You need to open a business banking account if for no other reason than to make an audit run more smoothly. You don’t want an auditor wading through your personal affairs to locate your business interests.
- If you travel anywhere with your vehicle for a business related purposes (networking event, conference, dinner, etc.), you can deduct the actual vehicle expenses or the standard rate per mile driven. For 2015 tax year, the standard rate is 57.5 cents per mile driven.
- When you expense meals and entertainment, write down on the receipt who was in attendance as well as the purpose of the event. Your tax preparer will thank you!
LabFellows recently announced the opening of Home Lab, an innovative approach to lab bench space for San Diego scientist entrepreneurs. Home Lab eliminates the burden of owning and running fully equipped labs by offering subscription-based packages. These packages pair lab bench space with pre-configured workflows (e.g. cell culture room, biosafety work areas), shared equipment and customized concierge-style services. This is an expansion of LabFellows’ ongoing commitment to provide ready-access resources for local science startups.
On a recent tour of the new facility, Julio de Unamuno IV, CEO, explained how Home Lab works: “A local start-up will first fill out a Request Guide which allows us to provide the best solution for that startup’s specific needs. Solutions range from hourly access to specific equipment to monthly subscriptions which includes wet lab space with modular workflow plans and on-site services. During the implementation phase, LabFellows outfits Home Lab with all the equipment, reagents and consumables your company needs, so the space will be turn-key and ready to start running experiments as soon as you step in!”.
LabFellows also helps with permitting, safety plans and other documentation needed to get you started. As a full-time or commuter user, LabFellows will provide a purchasing service, on-site shipping & delivery, waste disposal management, Wi-Fi, meeting rooms and 24/7 access with security.
What separates Home Lab apart from incubators and co-working style facilities, is a new concierge approach that helps entrepreneurial scientists build their teams and conduct research in a configurable, efficient environment. LabFellows strives to eliminate the lab operation headaches that pull scientists away from the bench. It believes scientists should not be limited in their abilities to advance their research simply because they do not have access to the necessary workflows.
The LabFellows Management Team includes seasoned San Diego entrepreneurs: Julio de Unamuno IV (CEO and co-Founder of LabFellows) and Tim Ryan (COO and co-Founder LabFellows and San Diego Startup Week). To learn more about Home Lab, please visit sdee.labfellows.com and receive special rates for being a registered SDEE member!
Featured Interview with Regina Bernal, USC Entrepreneurship & Experiential Learning
Regina Bernal leads entrepreneurship initiatives in the School of Business Administration at the University of San Diego (USD). As the entrepreneurship and experiential learning coordinator she empowers student entrepreneurs to turn their venture ideas into a reality through the V2 Pitch Competition, the Legacy Entrepreneurship Conference, and the year-long coaching and mentoring program.
“The goal of these initiatives is to help the next-generation of entrepreneurs go from an idea or inspiration to a venture concept, and maybe even launch their own business,” said Regina. “Regardless of the career path the students choose, they will learn the foundations of how to start up and move their ideas forward.” While the initiatives were born out of the School of Business Administration, they are open to students campus-wide—undergrad, MBA, and international.
What makes the initiatives unique is that they leverage the international theme of USD. “USD has had very close ties to Mexico, so we are initially focusing on the Cali-Baja mega region,” said Regina. With a USD track and a binational track, the initiatives provide resources for entrepreneurs on both sides of the border. Altogether the initiatives received more than 100 projects this year—55 for USD and 67 for binational.
The highlight event each year is the V2 Pitch Competition, which has tripled in entrants, prize money, and attendees since its first run three years ago. “This is basically academia meets the real world,” said Regina. The students work directly with angel investors who look at business proposals on a day-to-day basis. “V2 has been a huge success on the extracurricular side. Members of the community come to network with the angel investors and meet the student ventures. It’s a huge celebration for entrepreneurship in San Diego,” said Regina. “Our first event had 15 entrants and now we’re up to 55. The ventures are very diverse and include technology, digital apps, devices, and lifestyle brands.”
The V2 Pitch Competition offers credibility that young entrepreneurs don’t typically have early on. “Winning students can say they are the best company coming out of USD, and that they have already received investment,” Regina explained. “One company took $40,000 out of a $50,000 fund. Investors are now interested to talk to them and willing to accept meetings.” V2 winners have gone to raise more than a million dollars. One is part of 500 Startups in San Francisco, a leading global venture capital seed fund and startup accelerator. “At the same time, it’s about the learning experience. We’ve identified successful companies through V2, but we’re just as concerned about the other companies. Our job as an academic institution is to be that educational port for entrepreneurship,” said Regina.
The program relies on input from different organizations in the community such as CONNECT, EvoNexus, and HeraHub. “People from the community are the main coaches and mentors for the students,” said Regina. Angel investors such as Analytic Ventures, Tech Coast Angels, and The Startup Garage are an important part of the initiatives, volunteering their time and expertise to review projects and pitch decks. While the events are free and open to the community, the initiatives depend on sponsorship to raise the money for the student prizes. For example, Startup Garage provides in-kind support for prize money. “Startup Garage offered $4,000 in prize money for a student entrepreneur, which is huge for us,” said Regina.
In preparation for the V2 competition the program provides workshops to help students build their pitch deck and design their business model. “Our professors lead a lot of the workshops, but we like to bring in people from the outside to share their expertise,” said Regina. They are plenty of opportunities for SDEE members to get involved. “If there are SDEE members that have product-to-market know-how, want to make themselves available to students, and be part of this millennial generation, I would be more than happy to make the connection,” said Regina. There are opportunities in the coaching and mentoring initiative, as a speaker for the entrepreneurship club, or as part of the deciding panel for the V2 Pitch Competition or the Legacy Entrepreneur Conference. “It’s beyond volunteering because you make connections to future entrepreneurs,” said Regina. “It’s magic when communities and academia come together. These amazing synergies benefit everyone involved.”
To learn more about the initiatives, please visit http://usdentrepreneurship.com/.
(1) Need to know more? Click on this link to read an FAQ and