Archive for the ‘IP’ Category:

Building An Idea Assembly Line

When we look at the history of technology successes, we are reminded time and time again they come from incubator areas.  Not from the artificial technology incubators that VCs might set up to house new start up companies, but from regions which are good at incubating companies.

What these regions have are some combination of:


Big Technology Companies

Research Labs

Now – the advantage of having these sorts of institutions are they put lots of bright people together, playing with technology.  And specifically, the people they put together playing, don’t have to be entrepreneurs – they are getting paid some sort of wage (good or bad) to come up with new things.

The typical VC approach is to wait until there are companies formed by the few of these people brave enough to sacrifice their working wage and go it alone.  The hope is that the best ideas have risen to the top, and have been picked up by people capable of running companies.

But, if you talk to a VC, a common issue which causes them not to back a start up, is the poor quality of the team, not the quality of the idea.  And many many companies wind up pivoting to follow a different idea from the reason they got together.  You need a combination of good ideas and good people throughout the start up’s life.  You need the idea generators to stay in the company.  And you need a strong business team to take on the best ideas.

I wonder if the solution is to come up with an artificial equivalent of the research lab in order to breed ideas, and form teams.  I call this the Idea Factory.

Imagine an office (perhaps a big, brightly coloured open plan office – or perhaps something different) where some number of bright people are employed.  Their job is to have ideas, to prototype them, and to demonstrate them to one another. They also spend some time on building reusable frameworks to make prototyping new ideas easier and easier.

The time spent on prototyping ideas should be short (perhaps measured in days), and we should be quick to drop ideas.  People should feel free to provide support to each other, in taking the ideas they like and adding to them, or improving on them.  Forking ideas, and using their own skills, or even just making suggestions for other people to fork.

Over time, teams would grow, and some ideas would rise above others.  These ideas can then be shown to the world.  At conferences.  In papers. On YouTube. Or by going live on the web.  The question becomes ‘what is the minimum needed to get this idea out there?”

And this is where the VCs come in.  VCs already know people who are good at forming businesses, people who know what to do next.  They can take a team with a good idea and match them up with the business skills they need to move one step on.

Now – the important point here is that, all the time people are working in the idea factory, they are being paid.  You want people in the factory with a range of experiences – from fresh hungry graduates, through to the world weary sorts who have seen everything and know how things really work.  So there are going to be a range of salaries. Perhaps, because the work environment is unusual, you might be able to get away with offering a lower salary then the market would usually require. The question of salaries is where the VCs take a risk – how much time and money will these people need per idea?  By the time the idea is being fitted out into a standalone start up, the risk should be much reduced, and the VCs should be happy about getting a higher rate of return.  [Also, one presumes that an idea factory would be a good source of patents, if one of the members were to be a patant lawyer]

Idea Factories might be the way to inspire entrepreneurial growth in towns currently lacking it, or for a small group of VCs to monopolise start ups (and get a better share of the equity then they might otherwise manage)

But wait – Idea Factories might not just be good for VCs.  Consider your big company – not quite a company the size of Google, but the sort of tech company which regularly takes over large convention centres to support their customer base.  These companies often need new ideas.  They could set up internal idea factories along the same lines, getting people to play with the sort of technologies they are interested in.  It would lower the risk of disruption, and – even if all the ideas came to nought – give them a way of showing they support innovation.

This is an idea which I think – based on rough estimates -  has legs and is worthy of further investigation.  Please contact me if you think you might want to play a part in bringing an Idea Factory to life – either as a venture investor, or within your company, because I would very much like to help.

Of Rights And Laws

There is a problem with some laws: they gradually make you think that your legal rights are in some sense moral rights, deriving not from the law book but rather something in nature. One set of laws I see people be living are moral rights over and over again are intellectual property, specifically

Copyright – the right of a creator to prevent the copying of his work, and the creation of derived works

Patents – the right of an innovator to hold a monopoly over a particularly innovative idea’s use (there are those who claim patent law is payment for adding to the sum of human knowledge, but if this is true, patents would have to be expressed in a far clearer way than the law presently requires – and there would be no need to penalize independent inventors who wish to add their own take on the idea.)

To consider copyright to be a moral right would seem to fly in the face of human behavior – both now when many people feel they can share media they enjoy and create both mash ups and fanfic based upon it, and in the past when riffing off preexisting works led to the output of Shakespeare and Marlowe, not to mention the Bible.

Patent law as a moral right is less defensible, as it suggests that should I have an idea – a really clever innovative idea – I may not act on that idea in the privacy of my own home if someone else happened to have that idea first.  Even if I am completely unaware of the fact someone else had the idea.  No, that is not moral, indeed it seems to be bordering on thought crime.

So if these laws are not derived from moral rights, why were they enacted, and why are they tolerated? The answer would seem to be that they provide a benefit.  Most often I hear that the benefit they provide is that copyright encourages people to create, while patents encourage innovation.  But these arguments are too simplistic – I know many creative people, and in general, creativity is something they have in abundance.  They cannot help but create. And generally they enjoy sharing their creations with others.  The same is true of innovators- those with innovative minds cannot stop innovating, and generally would love to see the world improved by their ideas. Copyright and Patent law do nothing to help such people.

What copyright and patent law do is protect the next stage of development of creative or innovative work, the boring or expensive parts -the things no one would do were it not for the potential of financial compensation.  So when we consider patent and copyright law, we should not worry about the value of the idea, but rather the cost of the idea’s implementation.

Consider, for instance, the process of writing a book.  The first draft is a hard slog.  Each rewrite more and more painful.  Copy editing and proof reading something akin to inserting nails through your eyeballs.  Thus a finished book is something that costs money to produce.  Consider on top of this the cost of printing, distributing and marketing the book.  These also cost money – though with the rise of electronic media, the printing and distribution costs are falling, and authors are increasingly responsible for their own publicity.  Moreover, they do not add value to the work – they add value to the work of the bookseller (the guy who makes it as easy as possible to find the book you will enjoy the most).  I would therefore argue that these costs do not need to be protected – or paid for – by copyright (as a bookseller would prefer to perform any marketing on the version of the book he can profit most from selling – without caring if the author gets a cut)

So the authors ideas – all of them – without the slog of putting words to paper, then endlessly fixing them, have no value.  Does the slog add to the value of the ideas?  My initial thought was yes – since one can perform all sorts of boring tasks which do not produce value.  The value comes from the fact the slog of writing encapsulates the ideas.  However, there are also many other kinds of slog which take skill, but do not require ideas in order to make an idea containing work more valuable.  Proofreading is an example.  Ultimately, creatives generate ideas for fun, and might even pay for the opportunity to generate ideas were ideation somehow restricted, in exactly the same way that you and I pay to watch TV.  The entire amount of work an author does is the slog involved in putting the ideas to paper.  That is what they need to be rewarded for.

The same is true for the inventor.  And the programmer.

The authors only argument against this is that they hold a monopoly over their ideas, and may charge what the like for them.  I am inclined to agree that this is true before they have distributed their work – but afterwords, the ideas have been transmitted  the author no longer has a monopoly on them – anyone could now take those ideas, and, given time and effort produce the same work.  If we ban people from thinking those thoughts the author has transmitted, we seem to have banned the reading of the book.

So an author could request a bounty before releasing his ideas, but cannot control their spread once he has done so.

As such, it seems once the ideas are released, we need only pay the author for their work in writing the book (and those who assist).  If I wish to distribute the book, I simply need to pay the author for his time in producing it.  And once I have done this, I would have the same level of rights to the work as the original author – it would be as if he were retrospectively my employee.  Judging this cost would  be, in theory, up to the author… but we could make assumptions based on a maximum fee per hour to determine a fair upper price (and even allow court cases where this could be challenged).  Once one person has paid off the author, they could then sell rights for the same price (Or lesser rights for less)

The same concept could base software reproduction rights on the cost of development (there would be no room for software patents), and mean patent law becomes replaced by the cost of development based on the patents (which would suit the pharmaceutical industry).  It would become much harder to lock up good ideas and prevent them from being used.  It would also kill business process patents – which seems the best thing to do with them.

This does create a new right – the right to be compensated for hard work.  I currently fail to see a way to encourage hard work without this right.  And also still gives you the right to not share an idea without compensation (but not to control the idea thereafter), which does seem, to me, to be a natural right.  But it takes away many of the non-natural rights and is my proposal for movement to a fairer system of idea creation and exchange.