PatSnap aims to take blood, sweat and tears out of R&D
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PatSnap aims to take blood, sweat and tears out of R&D

“Companies spend billions but the efficiency model is broken,” says Ray Chohan, VP of strategy at London-headquartered startup PatSnap. Chohan could be talking about any number of things but in fact his subject is research and development, that much-ballyhooed investment that is often used to separate the great and good that pile cash into discovering what might be Next Big Thing from the commoditised bad.

That’s food for thought: in tech, even vast, mature companies can spend up to 20 per cent of revenue on R&D; other sectors have their own risks, often governance-related and patent trolling is a ubiquitous, live challenge. But, Chohan says, there have never been good checks and balances, KPIs or ways to apply best practices. Sure, Sand Hill Road VCs can share knowledge on what’s advisable but a way to apply metrics and come up with hard answers as to whether your R&D spend is being directed down the right road is tougher.

“We put in guardrails, a framework to at least minimise some of the challenges companies have,” says Chohan, who worked for industry analyst Datamonitor before joining PatSnap to set up its London office and EMEA and North American sales operations. “Throughout the funnel, we chip away at risk factors.”

Founded in 2007, PatSnap’s is a polyglot history. Its commercial HQ is London but it has a large presence in China and its founder Jeffrey Tiong came from the National University of Singapore. Chohan met Tiong at an industry convention in Disneyland Anaheim of all places and he started London ops from his home in 2012, which is probably a step up from where Tiong started the company – a rented sea container. Such is the glamour of bootstrapped, startup life.

At the heart of PatSnap’s offer is a continually updated database of around 120 million different patents from all around the world, augmented with relevant ancillary information regarding litigation, economic data, valuations and so on. It provides customers including MIT, NASA, PricewaterhouseCoopers and Vodafone with valuable intelligence that helps them swerve copyright infringements, chart and course-correct strategies by seeing where others are spending their research dollars, and make smarter decisions on M&A.

Most customers are blue-chips spending more than $1bn on R&D annually although there are discounts for smaller ventures and there is surely a large market for an accessible way to avoid heartbreak for non-IP experts who spend years developing ideas only to face the hatchet-faced lawyers of giants. Life sciences, FMCG, chemicals and automotive markets are strong for PatSnap but the wider mind-set is “anybody who is touched by innovation” in a world that is “turning into software”. Customers pay a subscription to access the service which the company website describes as an IP analytics and management platform.

PatSnap has so far played its cards fairly close to its chest but the company inevitably got some buzz when it attracted total  investment north of $50m from firms including Sequoia.

“Companies have their own dashboards and systems everywhere else and they have their flight decks but with R&D they’re flying blind,” Chohan says. “There’s no Slack or Huddle where people can co-create.”

Chohan sees a particularly happy hunting ground in the area of hooking up enterprises with the academic community and open innovation, a relationship that can historically have something of the ‘oil and water’ about it. PatSnap is intended to offer a ground zero for sourcing and identifying talent and scouting what’s going on in tech, almost like a LinkedIn for R&D, I suggest, although Chohan prefers “Salesforce for R&D” or “Amazon for innovation”.

The company has 600 in staff, 150 of them in London and it describes itself as one of the “fastest-growing venture-backed companies in SaaS in London”.

PatSnap is mulling its options in consulting services (through delivering or partnering) and has bigger ambitions: to help business, academia and governments span east and west in a world that is globalising and where companies are heavily reliant on building a better mousetrap than rivals. Get that right and an IPO would not be out of the question in a few years’ time you feel.

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Martin Veitch

Martin Veitch is Editorial Consultant for IDG Connect

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