22 May 2019Patents

SMEs filing IP more likely to have high growth: EPO and EUIPO

Small and medium-sized enterprises (SMEs) that have applied for at least one type of IP right in Europe are 17% more likely to become a high-growth firm than those that have not, according to a new study released yesterday, May 21.

For the purpose of the “Study on high-growth firms and IP rights”, released by the European Patent Office (EPO) and the European Union Intellectual Property Office (EUIPO), high-growth firms are those which had an average growth rate of more than 20% per year over three consecutive years and have had at least ten employees at the beginning of the growth period.

The study found that, in manufacturing industries, SMEs that have filed at least one patent application globally are 22% more likely to experience a subsequent growth period than those that have not. The figure is even higher for manufacturing SMEs that have filed for a patent in Europe: they are 34% more likely to grow.

In technology industries, the figure increases, with low-tech SMEs that have filed a European patent being 172% more likely to experience high growth than those that have not. In comparison, high-tech SMEs that have filed a European patent are 110% more likely to experience high growth than those that have not.

The study similarly reported that SMEs that have filed a European trademark application are more likely to experience high growth than those that have not.

For example, in consumer non-durable industries (such as recorded media, cosmetics, and pharmaceuticals), SMEs are 62% more likely to experience high growth if they have filed a European trademark.

In consumer durable industries (such as consumer electronics, furniture, and jewellery), SMEs that have filed a European trademark are 18% more likely to enjoy high growth.

The study also highlighted the benefit of owning multiple types of IP—it found that the chances of an SME becoming a high-growth firm increased by 33% when that SME uses a selection of IP (such as trademarks, patents, and designs) rather than just one type.

In particular, an IP portfolio which includes trademarks “systematically” outperforms comparable portfolios without trademarks, the study said, “suggesting that trademarks are the basic building block of effective IP bundles”.

Christian Archambeau, executive director of the EUIPO, said: “Our report clearly shows the relationship between IP rights and high-growth firms, in which trademarks, as well as other IP rights, have a crucial part to play.”

“A SME that has recently registered at least one trademark is 13% more likely to experience high-growth in the future,” he added.

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