Ideas need protection. Patents have long existed for this purpose, but they often involve long, arduous and financially draining journeys to legally protect an idea.
Around a year ago, Founder and CEO Eli Sheets quit his job as a patent attorney to form Durham-based IdeaBlock, which aims to change the game when it comes to protecting intellectual property (IP) by using blockchain technology.
In the early days of bitcoin and other blockchain technology, Sheets became quickly interested given his technology background through his undergraduate electrical engineering degree. Blockchain technology allows for the recording of transactions on a public, distributed and decentralized ledger that can’t be changed after the fact—it’s “immutable”—helping to avoid disputes and get rid of third parties.
“I kind of looked at it and thought, hey, this can be used as a time-stamping device or service that nobody can really argue,” Sheets said. “It’s so strong in its truth that I sometimes refer to it as ‘crowdsourced truth of time.’”
While IdeaBlock is not replacing patents or trademarks, it gives innovators some protection if they do not have the means to file a patent, which can cost around $60,000, or are stuck waiting for the up-to-several years that it can take to fully register a trademark, Sheets said.
“How are you supposed to work in a high-speed innovation business when you don’t even know if you have protection over this idea?” Sheets said. “We lower that bar in terms of understanding and in terms of time. So all you have to do is click a button and upload files that describe what you’re trying to protect, and we take care of it from there.”
IdeaBlock operates under a SaaS tiered subscription model. There is a free tier for solo inventors or artists who can then pay for more use after three free uploads. The middle tier is for businesses with 10-50 employees and costs $100 a month. The enterprise tier charges more per month for more customizable help in integrating IdeaBlock into a larger company’s existing IP management. Sheets said that while more traditional means of protecting IP are “offensive”—legally staking an official and often expensive claim with a governmental agency—IdeaBlock is defensive.
“We’re defensive in that the moment you put something on IdeaBlock or manage your idea on our kind of software suite,” Sheets said, “no one else can get that IP to block you in the future.”
With more than 10 customers, IdeaBlock is transitioning from beta to a full-feature public product coming out in a few weeks. The problem IdeaBlock hopes to solve—the high patent fees that prevent innovation—is one that Sheets saw the repercussions of every day as a patent lawyer. While these barriers might be good for lawyers and for the government, he said, it’s bad for business growth.
“Now we find ourselves in this position where now we’re limiting people’s access to social mobility just by virtue of the fact we have an expensive paradigm for protecting ideas,” Sheets said. “I don’t think that that’s ideal.”
Sheets said IdeaBlock is a first mover in tackling this issue in this way. IdeaBlock is looking for a next round of funding after its initial friends and family round of $500K.
Going forward, Sheets believes the technology is applicable to other specialized fields. For instance, he is tinkering with a version that would be exclusively for protecting commercial music, and also a general ability to prove that a specific electronic file—such as a will—exists at a certain time. But before this scaling, IdeaBlock is focusing on protecting innovation, the idea that led Sheets to launch the company last year.
“Just get out of the way and let people innovate and let people go after their dreams,” Sheets said, “instead of having to worry about pinching pennies to even get their idea protected.”