How to budget for patenting if you’re a startup or individual inventor

Why Budgeting for Patents Matters

Patents aren’t like filing a business license or trademark. They require highly technical legal work, multiple rounds of back-and-forth with patent examiners, and sometimes years of persistence.

If you don’t plan ahead:

• You risk running out of money mid-process, leaving your invention unprotected.

• You might settle for a weak, poorly drafted patent that fails when challenged.

• You could over-invest in patents that don’t align with your business strategy.

Budgeting gives you clarity. You know what’s coming, you can allocate resources wisely, and you avoid financial shocks later in the process.

The Major Cost Components of a Patent

Let’s break down where the money goes. Costs vary by country, technology, and complexity, but these are the typical building blocks:

1. Prior Art Search

Before filing, most inventors run a prior art search to see if their invention is truly new.

• DIY search: Free (but limited).

• Professional search: $1,000–$3,000.

A professional search often saves money in the long run by preventing weak or doomed applications.

2. Drafting the Patent Application

This is usually the biggest upfront cost. Patent attorneys spend hours crafting claims and descriptions to maximize protection.

• Simple mechanical inventions: $7,500–$10,000.

• Software or biotech: $12,000–$20,000+ (complex inventions need longer, more detailed drafting).

3. Filing Fees (USPTO or other offices)

• Provisional application: $75–$300 (USPTO small entity rates).

• Non-provisional application: $400–$800+ depending on entity size.

• Design patents: Cheaper (typically under $2,000 total).

4. Prosecution (Back-and-Forth with the Patent Office)

Few patents are granted on the first try. Each office action response may cost $1,500–$3,000 in attorney fees. Two to three responses are common.

5. Maintenance Fees

Once granted, U.S. patents require payments at 3.5, 7.5, and 11.5 years to stay in force. These range from $800–$7,400 depending on entity size.

Total Cost Estimate

So what’s the grand total? For a single U.S. utility patent, startups and inventors should budget:

• Low end: $10,000–$15,000 (simple inventions, fewer office actions).

• Typical: $15,000–$25,000.

• High end: $30,000+ (complex inventions, multiple rejections, appeals).

Design patents are far cheaper—often $2,000–$5,000 total—but they protect only appearance, not function.

Budgeting Strategies for Startups and Inventors

Here’s where planning makes all the difference:

1. Use a Provisional Application Wisely

A provisional application is inexpensive and holds your priority date for 12 months. This gives you time to:

• Test the market.

• Raise investor funds.

• Refine your invention.

Budget tip: File a provisional first, then raise money to fund the non-provisional.

2. Prioritize Your Core Inventions

Not every idea deserves a patent. Focus on:

• Products that drive your business revenue.

• Features competitors are most likely to copy.

• Inventions critical to fundraising or partnerships.

Budget tip: One strong, enforceable patent beats five weak ones.

3. Explore Small Entity and Micro-Entity Discounts

The USPTO offers steep fee discounts if you qualify:

• Small entity (50% discount): For businesses under 500 employees.

• Micro entity (75% discount): For individual inventors who meet income and filing limits.

Budget tip: Always check eligibility before paying full fees.

4. Plan for the Long Haul

Remember, patents aren’t just a one-time cost. Budget for:

• Prosecution over 2–4 years.

• Maintenance fees across the 20-year lifespan.

• International filings (if relevant).

Budget tip: Spread costs across years, not months. Treat patenting as a staged investment.

5. Consider Alternatives to Full Patents

Sometimes a full utility patent isn’t the best fit:

• Trade secrets: Keep your invention confidential (especially for processes).

• Design patents: Protect the look of your product more affordably.

• Copyright: Covers software code, manuals, or creative works.

Budget tip: Match your protection strategy to your business model, not just your invention.

Hidden Costs Startups Often Miss

Beyond attorney and filing fees, inventors should be aware of:

• Drawings: Professional patent drawings cost $100–$300 per sheet.

• Translations (for international filings): Can quickly add thousands.

• Foreign counsel: Each country requires local attorneys.

• Defensive searches (freedom-to-operate): Ensures you don’t infringe existing patents.

Ignoring these extras can blow up your budget unexpectedly.

Example Startup Budget: A Realistic Scenario

Imagine a startup with a new consumer gadget. They want one core U.S. utility patent. Here’s how the costs might look over time:

• Month 0: Prior art search — $2,000

• Month 2: Drafting provisional — $3,000

• Month 12: Drafting and filing non-provisional — $10,000

• Month 24: Office action response — $2,000

• Month 30: Second office action response — $2,000

• Year 3–4: Patent granted

Total over 3–4 years: ~$19,000.

By spreading costs across years, the burden becomes manageable.

Final Thoughts

For startups and inventors, the patent process is both a financial and strategic investment. Budgeting isn’t about finding the cheapest route—it’s about ensuring you get protection that holds up when it matters most.

With the right plan, you can:

• Secure early protection through provisional filings.

• Prioritize inventions that matter most to your business.

• Take advantage of fee discounts.

• Spread costs across the life of the patent process.

A well-budgeted patent strategy isn’t just a legal shield—it’s a growth tool that attracts investors, fends off competitors, and builds long-term value for your company.

Protecting your invention is worth the cost, but protecting your wallet along the way is just as important. 💡💸