Technical Difficulty Rating: 3 out of 10
Which should you start with first, a patent or a prototype? The large majority of entrepreneurs start the process of bringing their product idea to market by either focusing on a patent or a prototype.
But should you really focus on either of these as your very first step for your product?
Actually, before I answer that question let’s first talk about patents, then we’ll discuss prototypes, and finally I’ll answer which should be your first priority.
Many entrepreneurs think that they should start by getting a patent for their product. This tells me they are focused on their idea and not the execution of that idea.
Keep in mind that patents are not cheap. A utility patent will cost you at least $10,000 and can take a year or more to complete. It’s quite a large investment of both time and money.
Only a very small percentage of patents make it to market, and only 3% of patents ever make any money. So why do so many patented ideas for products fail?
Failure happens when inventors over focus on their idea and how to protect it, without giving any thought to all the other steps required to get the product to market.
Getting a patent is one of the easiest things that you can do, and that is one of the reasons I think so many entrepreneurs make the mistake of placing to much importance on a patent. Most entrepreneurs (and especially inventors) would much prefer to focus on a patent than to focus on something like market research or making sales calls.
But if you haven’t thought about what comes after the patent, you will find yourself asking, now what? By now you are probably about a year into your project and have already spent close to $10k. Yet, all you have to show for it so far is a piece of paper. There are much better ways to spend that money.
Early on, your priority needs to be minimizing your financial risk and that means not spending money unless it’s necessary.
For most people $10,000 is a large amount of money and there are a lot of other ways that you can use that money more efficiently than spending it on a patent as your first step.
Patents should never be your first step and don’t over focus on protecting your idea.
Like I said most patents don’t make it to market. You need to think positive, but at the same time you need to operate under the assumption that your product will be a failure. Because the odds are statistically that it will be a failure.
Of course, no entrepreneurs wants to think their product will be a failure. Everyone wants to believe that their product will be a massive success, but odds are it won’t be. Just keep that in consideration.
Types of Patents
There are two different types of patents. Broadly speaking, a utility patent protects the operation, function or solution that you’ve come up with. A design patent, on the other hand, protects the appearance and aesthetics of a product.
What most people think of when they think of a “patent” is a utility patent. There are two categories of utility patents, a narrow patent and a broad patent.
A narrow patent only protects something very specific about the solution. Keep in mind, it can be easy for a competitor to work around a narrow patent.
Let’s say you have a great product idea but you’ve only patented one specific way of doing whatever it is your product does. If there are 10 other ways to make a product do the same thing, then a competitor can swoop in and easily work around your patent.
For this reason, narrow patents don’t have near the value of a broad patent.
A broad patent will protect the general concept of a solution, and this makes it more difficult for a competitor to work around versus a narrow patent.
In general, design patents and narrow utility patents are both easy to work around. Obviously, with a design patent you can just change the way something looks.
The advantage of these two types of patents is they tend to be much cheaper. A narrow utility patent will cost around $10,000, so it’s still quite expensive. You can get design patents for considerably less. They cost only a few thousand dollars.
Design patents are especially easy to work around in most cases but they do allow you to say your product is patented. From my experience, being able to say your product is patented or patent pending is actually more important than the patent itself.
Start with a low-cost provisional patent application which gives you one year of protection.
You’re probably not going to be in a situation where you have to go to court and defend your patent. But having a patent is helpful in other ways, like when you’re trying to sell to large retailers that require it.
Although design patents and narrow utility patents are lower cost options, they are still expensive and shouldn’t be your first step.
Instead, start with what is called in the US a provisional patent application. This only costs a few hundred dollars and it will protect your idea for one year. At the end of that year, you can decide if you want to pursue the full utility patent. This gives you a year to decide if your product is worth investing in.
The myth of stolen ideas
Keep in mind that in general, no one is going to steal your idea. That’s one of the biggest myths that many inventors and entrepreneurs believe in.
In fact, many entrepreneurs are so paralyzed with fear of someone stealing their product idea that they never share the idea with others. The one thing I can guarantee is that if your product idea never leaves your head it will never make it to market.
People simply do not steal ideas. I’m not going to say it never happens, but it is very rare. You may also be struck by lightning before your product reaches the market, but I don’t think anyone would make lightning avoidance a primary strategy for their startup.
Instead, what really gets “stolen” by other companies are successful products, not unproven ideas. They’re going to wait until you’ve made your product a massive success, proved there’s a market for it, and proved that people will buy it. These things are what gets their attention.
Every company has hundreds of ideas, but they can’t pursue them all because they know a lot of them will be failures. Executing on an idea and proving that it will be a success is what creates all of the value.
In general, keep in mind that patents focus on the idea. But to be successful you have to focus on the execution. Your idea is worthless without execution.
Everyone has ideas for new products. Many people dream of bringing one of their ideas to market. But execution is what separates the successful entrepreneurs from people that just want to dream.
Any real value comes from tons of hard, smart work, and not just the idea itself.
So, if a patent isn’t the best place to start, does that mean you should start with a prototype as your first step?
Well, not so fast. It’s not quite that simple.
Production prototypes are eventually required, but they should rarely be your first step.
Types of Prototypes
First, let me broadly define two types of prototypes you will work with: Proof-of-Concept (POC) prototypes, and production-quality prototypes.
A proof of concept prototype is to prove that your idea works using off-the-shelf components. For example, you might use an Arduino, along with various Arduino shields, and other off-the-shelf components.
A POC prototype is a lot different than a production prototype. The primary goal of a POC prototype is to prove the basic concept of the product. Rarely, is it feasible to bring a POC prototype to market. The manufacturing cost will be too high, or the product size will be too large, or it will be too power hungry.
A production prototype, on the other hand, uses the same technology and processes that will be used during mass manufacturing. For instance, you won’t use an Arduino and shields. Instead, you will use a custom printed circuit board design, and a custom plastic enclosure.
A POC prototype will be much cheaper to develop, but much higher to manufacture. Whereas, a production prototype will be much more expensive to develop, but have a much lower manufacturing cost.
Should You Start with a Prototype?
If you have very fundamental questions about your product’s functionality then a proof of concept prototype may be a good idea. If you have concerns if your solution really solves the intended problem, then starting with the proof of concept prototype makes a lot of sense.
It helps you prove and refine the basic concept of the idea.
If you’re a maker then a POC prototype may be a good early step depending on your product.
Are you a maker that’s already familiar with DIY electronic projects, and how to use development kits like an Arduino or Raspberry Pi? If so, a proof-of-concept prototype is likely a good place to start. If you can do most of the work yourself, you will learn a good amount without having to spend a lot of money.
So, if you’re a maker, or you have very fundamental questions about your product, then a proof of concept prototype can be a good way to start.
If you’re not a maker, or you don’t have any fundamental questions about your product, then a proof of concept prototype is not a good strategy. It’s not going to really give you anything useful and it’s just going to consume time unnecessarily.
Tech companies never start with a prototype. They first gather data and formulate a plan.
This is why big tech companies almost never build a proof of concept prototype. In fact, a lot of professional engineers scoff at the idea of proof of concept prototypes because they know an Arduino is so fundamentally different from a final product that there isn’t a lot of information they can gain from it.
It’s much faster for them to get to market if they instead start right away on a production prototype.
You will need a production-quality, custom prototype at some point, but it’s expensive and very time-consuming. It’s not usually the best way to start the process of bringing a product to market. It is too expensive, complex and time-consuming to start with that step.
What You Should Really Focus on First
Most entrepreneurs need to start with two steps – market research and creating a realistic plan forward. You can’t just “wing it” with product development and bringing a product to market.
The biggest mistake I see people make is they dive headfirst into either a patent, a full prototype, or both. They put all their focus, time, and money into the patent or prototype.
Instead, your first steps should be to understand the market for your product and to create a realistic plan forward.
There are many expenses and steps that need to happen to get a new product on the market, in fact more than most people ever imagine.
I’ve never known a single successful entrepreneur that has said “that was easier than I expected”. It’s always much harder than you initially think.
You need to know about these obstacles well ahead of time in order to have a chance at success with your product.
Also, these obstacles can vary significantly from product to product. Once you understand all of the obstacles for your specific product, you may discover you are better off pursuing a different product idea with less obstacles to overcome.
You have to collect all of this information in order to know if your idea is really worth pursuing. Otherwise, if you just jump in, you risk spending years of your life, and boatloads of money developing a product that you later discover isn’t profitable or is just too complicated to bring to market.
For example, if you need to sell the product for $99 yet you eventually discover it costs $75 to manufacture it, that is not a profitable product. In that case, the product should have never been pursued beyond the initial research stage.
If you’re taking all the risk of developing a new product, and you’re spending all that money, then you need to be able to make really good profit margins. The retail price will need to be at least 3-4 times the cost to manufacture it.
The other thing that happens with a lot of entrepreneurs is they don’t properly forecast how much money it’s going to take to get their product all the way to market. This means they will run out of money before they are able to get their product to market.
Don’t focus on a patent or on an expensive, production prototype. At least, not at first. A production prototype is essential of course, but it definitely shouldn’t be your first step.
Instead, focus on market research and understanding the steps and obstacles that lie ahead. Then you can decide if your specific product idea is worth the risk. You shouldn’t proceed until you understand all aspects of the risk.
After you fully understand the risks, then you can decide if it’s worth it.
If you decide it is worth it, then you need to formulate a realistic plan.
Without understanding all of the obstacles, and with no real plan to surpass them, you’re like a sailor crossing the Pacific Ocean without a map or weather forecasts. Unless you happen to be Polynesian I would not suggest you attempt that type of journey.
If you need help understanding all of the obstacles and costs that lie ahead for your specific product, and you need help creating a realistic plan forward, then check out my Predictable Hardware Report service.