Basically, Shark Tank starts with a panel of entrepreneurs and business executives (e.g., Dallas Mavericks owner Mark Cuban) called “Sharks.” The Sharks then consider offers from different entrepreneurs who appear each week and seek investment from the Sharks for their business or product.
Fiction and truth can meet in strange places sometimes, and provide for good entertainment. IP lessons from the Shark Tank include:
1. Look before you leap. Entrepreneur (and contestant) Tiffany Krumis, who sells a children's medicine dispenser, says that the smartest thing she did before pitching her product was "[a] detailed patent search, to make sure I wasn't infringing on anyone else's intellectual property and ensuring I could patent it myself."
2. Patents can play a valuable role in a pitch. Pundits debate the extent to which snap business valuations may be made from the intellectual property assets of a business. But, as the Sharks demonstrate, there is no question that these assets can be a significant part of overall value. Mere pending patent applications can signal: (a) due diligence; (b) competitive acumen; (c) the prospect of exclusivity and market deterrence; and (d) possible diversity in business models through licensing, etc. Perfected rights in the form of issued patents may take you to the next level.
3. Focus on business objectives and value. As Mr. Cuban aptly tweets: "a patent does you no good if the application consumes all your cash/time." Focusing on the business objectives is the paramount goal. The role of a good intellectual property attorney is to help you with legal strategy that yields the most effective and value-returning options to achieve those business objectives through perfecting (or in some cases not perfecting) intellectual property rights.
4. Intellectual property can make Cuban go nuts! O.K., this is more fun than lesson. Check out this heated little video exchange between the Sharks and Idaho entrepreneur Scott Jordan [http://www.huffingtonpost.com/2012/03/08/scott-jordan-scottevest_n_1331680.html]. It raises several questions including:
- Is it important for entrepreneurs to demonstrate to investors where they are in the process of protecting intellectual property rights?
- What is the scope of claimed rights?
- Are the claimed rights strong and/or defensible? Have they been tested?
- What is the value of an intellectual property asset outside of its business model?
- Do lawyers really hate other lawyers? If so, does that hatred lead them to the greener pastures of clothing design?