A Very Special Episode: TV Takes On Patent Trolls

Next Story

Telefonica Opens Wayra Incubator In London, Plans More In Europe

While I find most reality TV abhorrent, last week’s Shark Tank brought a very interesting concept to the usual babble that is the modern “boss” show. In this episode, Scott Jordan, creator of ScottEVest, appeared in front of a motley crew of entrepreneurs including Mark Cuban and Kevin O’Leary to pitch his patent licensing business, Technology Enabled Clothing or TEC. You can watch the episode here if you’re a masochist.

I’m not about to defend any of the people on here except to say that they are successful in their own right and most of them are blowhards. Blowhards can and are often successful and interesting, but often not on their own terms (see also) and often to the detriment of their souls. But darned if they don’t make for some good TV.

The premise of the show is fairly simple. Entrepreneurs, usually some guys who have a widget to sell, come on the show to request a few hundred thou from these investors. Most important, Mark Burnett Productions, takes a percentage of each company, whether it receives funding or not, so it’s sort of a nice investment engine for ABC. The entrepreneurs get fifteen minutes in the spotlight, offering pitches that are one step up from a first-year MBA presentation, then the sharks get to tear into them. In the end, nobody goes home happy except maybe Mark Burnett.

So Scott comes on and wants to pitch TEC. TEC, for lack of a better term, is a licensing company, and for lack of a better epithet, it’s a patent troll. Rather than make anything, the company licenses the technology that is in ScottEVest clothing, ensuring the circle of litigation continues. Mark Cuban, in a bout of reasonableness, points out that this sort of company is what is wrong with the technology industry while Scott sticks to his guns saying that this is why the founding fathers built a patent system in the first place.

You’ll notice a few key phrases in that last paragraph: “reasonable,” “patent system,” “litigation.” Clearly this isn’t your Snooki’s reality TV.

The two got into it on Twitter with Cuban supporting a competing brand that, in a sense, infringes on Scott’s patent and Scott releasing wild-eyed videos and letters. In the end it degenerated into an exercise in self-promotion with Cuban coming out on top because he stopped caring after the show wrapped.

You get the idea.

If you’re still with me, there are two important lessons to take away from this. First is that entrepreneurship has now become popular entertainment. A decade ago, if you had an idea you had two options: you could try to sell it to a big company or you could hook up with one of those shady “invention” outfits who would try to license your patent, a la Intellectual Ventures. There really was no third way because there was no way to distribute your invention aside from putting a bunch of junk in your trunk and driving around the midwest like the dad in Gremlins.

All that has changed. Now there are pitch contests, Disrupts, hack-a-thons, FooBarCamps, Amsterdamstartup events, and trade shows galore. There are Kickstarters and Arduino boards and Chinese manufacturers lining up to build any piece of junk you can CAD. There are desktop, tabletop, and basement 3D printers and anyone with a mouse and a dream can code the next Path. It’s gotten so easy for people to build something that the competition to be good has been replaced with the competition to be first. And that race makes for good TV. No one wants to see some sad sack drive through Idaho trying to sell a smokeless ashtray but they love seeing two dudes get up trying to sell a pair of lip balms that mix to create different flavors because these guys have seen so many entrepreneurs do their little dance on stage that they think they have a chance.

The second lesson is that this show actually posited some very good points on patent law and the creative enterprise. Scott didn’t want to sell any part of his vest company because he knew it was a solid business. As odious as he seems on the show, he’s a smart guy and he knows he’s got a goose that lays hoodies. What he packaged for them, then, was a derivative. They were investing in future gains on lawsuits generated by his patents. If that isn’t the wildest television I’ve seen since Sammy Davis Jr. kissed Archie Bunker, I don’t know what is.

And Scott has no reason to be ashamed. Patent law works just as he described it. It protects him from copycats and clones for a certain period (and there are clones out there already, so it doesn’t work very well) and all of his posturing is business as usual in business. While Cuban is trying to be noble, Jordan is trying to be realistic.

So we get to the two most pernicious aspects of start-up life: the flip assumption that anyone can be a billionaire and the mercenary assumption that you should litigate any and all comers. Building a business is hard work. I’ve seen it done countless times and in the course of moving through TechCrunch I’ve done (some) of it. It’s not all elevator pitches and networking and seed money. It’s building a project in your spare time and then building another one and then building another one until you’re ready to ship. It’s building something on top of the real moneymaker in your organization – Instagram, for example, was a side project that became the main project – and then was spun off. It requires effort and intelligence, not jeans, a funny t-shirt, and a blazer.

Second, we have to agree with Cuban that patent law is broken and we have to agree with Jordan that his products must be protected. Patents are a slippery subject and too often they’re used as cudgels rather than sniper rifles. The more time spent putzing around with who infringed on who, the less time entrepreneurs have to make the next big thing. It’s a shame and it should change.

So there you have it: we learned something from reality TV. A real first. Hopefully Cam and Mitchell don’t decide to clone themselves, thereby raising a national debate on the legality of human chimaeras. I don’t think the public dialogue could handle it.