🧠 IP Truth Revealed: Speed Trumps Patents in Deeptech’s $1T Race—Unlock Your 10x Playbook Before 60% of Patents Fade
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I’m answering a question I hear all the time: How much should I care about intellectual property (IP) in early-stage deeptech? In deeptech—like AI, quantum computers, chips, or green tech—IP, such as patents, sounds like a big deal because it protects a startup’s ideas. But here’s the truth: while IP matters, moving fast and proving the tech works are way more important for making 5-10x profits in the $1 trillion deeptech market. As of April 20, 2025, I’ve got a clear answer with data to back it up, plus a simple plan to balance IP with speed for your investments. Let’s dive in!
Why IP Isn’t the Whole Story
IP—like patents or secret tech formulas—keeps a startup’s ideas safe from copycats. In deeptech, where building things like quantum security or eco-concrete costs millions, you want to know big companies can’t just steal the plan. But here’s the catch: 6 out of 10 deeptech patents lose their value in just 5 years because technology changes so fast (IEEE Spectrum, January 2025). That means getting customers, building the product, and growing quickly—called execution—are often more important than having a pile of patents.
I’ve seen startups with lots of patents fail because they couldn’t find buyers, and others with just a few patents succeed by moving fast. DeepL, an AI translation startup, raised $300 million at $2 billion with only 5 patents but had Siemens as a customer (TechCrunch, May 2024). Meanwhile, a quantum startup I skipped had 10 patents but no sales—it went bust. Data shows 8 out of 10 deeptech startups that raise big money at Series A focus on customer deals over just IP (PitchBook, January 2025).
When IP Really Matters
IP still counts in some cases—here’s when I pay attention:
Huge Markets: In markets worth $1 billion or more, like the $70 billion chip market, patents stop competitors. Etched.ai’s 3 patents protect its analog chips (USPTO, 2025).
Government Contracts: Military or NASA deals often require patents. QuSecure’s 5 patents helped win an Army contract for quantum-safe security (Crunchbase, July 2024).
Big Sales: When companies like Google buy startups, they want patents. CarbonCure’s 10 patents boosted its $80 million funding round (Crunchbase, August 2024).
But even weak IP isn’t a dealbreaker if the startup’s quick. XAI’s 10 patents are nice, but its SpaceX contract drove its $24 billion valuation (Crunchbase, May 2024).
Why You Should Care About This
Deeptech’s a $1 trillion market—AI ($207 billion), chips ($70 billion), quantum ($6 billion by 2028)—and early investments at $10-50 million valuations can bring huge profits (Statista, February 2025; BCG, February 2025). A $1 million investment could grow to $50-100 million if the startup hits a $500 million to $1 billion sale, like Anduril’s $14 billion deal (Bloomberg, December 20, 2024). But since 6 out of 10 startups fail (PitchBook, March 2025), knowing when IP matters and when speed wins helps you pick the right ones.
Startups Balancing IP and Speed
Here’s my list of startups with solid IP and fast growth:
CarbonCure: 10 patents, 700+ factory contracts for CO2 concrete (Crunchbase, August 2024).
QuSecure: 5 patents, Army contract for quantum security (Crunchbase, July 2024).
DeepL: 5 patents, Siemens deal for AI translation (TechCrunch, May 2024).
Etched.ai: 3 patents, Meta pilot for analog chips (Crunchbase, February 2025).
Mythic AI: 3 patents, drone tests for edge AI (Crunchbase, October 2023).
These are real deals—check Crunchbase or their websites for details.
Risks to Watch Out For
IP comes with some traps:
Quickly Outdated: 6 out of 10 patents lose value in 5 years—CarbonCure’s tech needs to stay cutting-edge (IEEE Spectrum, January 2025).
Legal Fights: 2 out of 10 startups face patent battles—QuSecure’s IP might need defending (PitchBook, March 2025).
Speed Over IP: Weak teams fail even with patents—DeepL’s fast growth was key (TechCrunch, May 2024).
Check uspto.gov or epo.org for patent strength and Crunchbase for customer deals to balance these risks.
My Game Plan for You
Here’s how to weigh IP when investing in deeptech:
Look for a Few Patents: Aim for 3 or more patents—Etched.ai’s 3 patents are enough (USPTO, 2025).
Focus on Speed: Customer contracts are more important than tons of patents—DeepL’s Siemens deal shows traction (TechCrunch, May 2024). Look on Crunchbase.
Invest Early: Put $5-10 million into startups valued at $10-50 million, like QuSecure’s $60 million valuation (Crunchbase, July 2024).
Target Big Markets: Go for markets worth $1 billion or more, like CarbonCure’s $50 billion green concrete market (BCG, January 2025).
Spread Your Bets: Mix startups with strong IP, like CarbonCure (10 patents), and fast-movers, like DeepL (Siemens deal), to lower risks.
IP matters, but speed wins in deeptech—5-10x profits are possible with QuSecure or DeepL.
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Stay sharp,
Eden Djanashvili
Author Invest Deeptech