How patents can provide additional revenue streams for Houston innovators

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A patent is an asset — says this Texas-based intellectual property expert. Photo via Getty Images

Seeking patent protection can offer a substantial competitive advantage to startups looking to raise capital, especially during a venture capital downturn. Besides the protection patents can provide against intellectual property theft, they are also assets that can translate into expansion opportunities and additional revenue streams. These factors are important to institutions and individuals that invest in startups, as they may reduce downside risks to their investments and help outline a growth trajectory.

As Kathi Vidal, under secretary of commerce for intellectual property and director of the U.S. Patent and Trademark Office, said during a speech last year, “having a [patent] pending application helps secure funding, and it keeps potential competitors out of your space.”

The experience of Austin-based VoChill, a startup that created a new line of personal wine chillers, offers a case study of how filing for patent protection as early as possible can set up any startup for success, not only when seeking to raise capital, but also when working to expand its commercial relationships and distribution channels.

Filing for patents quickly gave VoChill’s founders a competitive advantage when approaching potential investors, as it demonstrated the management team’s high level of preparedness and business acumen. For investors who eventually committed capital to the startup, the filings signaled a safer bet on investing in VoChill.

There is plenty of evidence indicating that patents help attract capital and generate growth opportunities. A study conducted by professors from Harvard Business School and New York University’s Stern School of Business found that patent protection increased startups’ odds of receiving venture capital funding by 59 percent.

PitchBook data shows that startups seeking patents raise more capital than their non-patent-seeking peers. About 58 percent of venture capital went to startups with patents or with patent applications from 2011 to 2020, the research firm notes.

Patents can also help drive a startup’s expansion and grow sales. According to the National Bureau of Economic Research, or NBER, the approval of a startup’s first patent application increases its employee growth by 36 percent over the following five years. After five years, a new company with a patent increases its sales by a cumulative 80 percent more than companies that do not have a patent.

Patents can also increase a startup’s chances of obtaining distribution deals or, in the case of consumer products, partnerships with retailers. In VoChill’s experience, patent protection is a recurring theme in conversations not only with investors but also distributors and retailers.

Patents offer startups the possibility to pursue a licensing model as well. Licensing or selling the rights to a patent so that others may produce products or processes based on that patent can bring in ongoing revenue streams.

Down the line, having patent protection can lead to better exit opportunities, be it by going public or via a private divestiture.

According to the NBER, having patents more than doubles the probability that a startup is eventually listed on a stock exchange.

PitchBook data, meanwhile, shows that patent-seeking companies go public at a rate more than five times higher than non-patent-seeking companies (23.2 percent versus 4 percent).

In the case of exits via a sale of the startup, the median exit value for patent-holding companies is 154.9 percent higher than it is for companies without patents per year on average, according to PitchBook.

While the business case for seeking patent protection is clear, startups should keep a few considerations in mind when seeking to do so. Understanding time bars is crucial; for example, the United States generally allows only one year to file a patent application after an invention is publicly written about, shown, used, or otherwise disclosed, and overseas often no one-year “grace period exists.”

Still, other important predicates are finding out whether the innovation is truly new, identifying the most crucial components of a product or system, and thinking about what aspects competitors are likely to discover and copy.

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Chris Palermo is partner at Baker Botts where he specializes in intellectual property development. Lisa Pawlik is CEO of VoChill, a company that creates individual wine glass chillers.

From Your Site Articles
A patent is an asset — one with a price associated with it when it comes to procuring a loan for your business. Photo via Getty Images

Rice research: What innovations can be used to borrow against?

Houston voices

For companies and leaders, patents represent important assets. They’re a marker of innovation and tech development. But patents do so much more than protect intellectual property. Firms increasingly deploy them as collateral to secure loans. Between 1995 and 2013, the number of patents pledged as loan collateral increased from about 10,000 to nearly 50,000. Forty percent of U.S. patenting firms have used patents as collateral.

However, patents are intangible assets, and their liquidity and liquidation value are difficult to assess. To evaluate an individual patent, lenders must consider the invention space to which the patent belongs. A patent’s linkage to prior inventions can provide important information for lenders, as the linkage affects the extent to which the patent under consideration may be redeployed and potentially purchased by other firms in the case of loan default.

Rice Business professor Yan Anthea Zhang examined more closely how this market operates and how both lenders and borrowers can make more informed decisions on which patents make appealing collateral. In their paper, “Which patents to use as loan collateral? The role of newness of patents' external technology linkage,” Zhang, who specializes in strategic management, and her co-authors studied the data on 107,180 U.S. semiconductor patents owned by 436 U.S. firms. The team focused on semiconductor patents because the semiconductor industry involves intensive innovation, which leads to many patent applications and grants. The market for semiconductor patents is an active and well-functioning market, given specialization in different stages of the innovation process and the growing technological market. Information on whether a patent was used as loan collateral came from the USPTO Patent Assignments Database.

Zhang and her colleagues argue that lenders prefer patents linked to prior inventions that are relatively new because these patents are riding on recent technology waves and are less likely to become obsolete. As a result, such patents are likely to remain deployable to other firms in the future. However, patents that are based upon too new prior inventions might not prove to be commercially viable and carry higher risk for lenders.

As a result of this research, Zhang and her colleagues found an inverted U-shape relationship to demonstrate the likelihood that a patent will be used as loan collateral. On one end, patents based upon the newest prior inventions, on the other, patents based upon mature prior inventions. The curve of the U-shape represents the sweet spot for patent collateral—the patents’ technological base is new enough to be relevant and competitive with other firms in its invention space, but not so new that it has yet to prove market success.

Zhang’s team also found that the impact of external linkage also varies depending on borrower attributes, especially the borrowers’ expertise in the invention space. If a borrower is a technological leader in the invention space, the market tends to give the borrower credit, and as a result, even if its patents are based upon very new prior inventions, its patents are still likely to be accepted as collateral.

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This article originally ran on Rice Business Wisdom and was based on research from Yan Anthea Zhang, the Fayez Sarofim Vanguard Professor of Management at Rice Business.

Doris Taylor from the Texas Heart Institute has been named to the National Academy of Inventors.

Houston inventor receives national recognition for leading innovation

Leading lady

A Houston inventor is being recognized for her leadership within cardiovascular regenerative medicine. Doris A. Taylor from the Texas Heart Institute has been named among the National Academy of Inventors' 54 academic inventors to the spring 2019 class of NAI Senior Members.

Taylor's work involves finding alternatives for the current practices for organ transplants, including the whole organ decellularization/recellularization technologies she developed in 2008.

"Dr. Taylor's work has revolutionized the field by making it possible to bioengineer scaffolds that effectively mimic natural organs," says Dr. Darren Woodside, Texas Heart Institute's vice president for research, in a news release. "The three U.S. patents she currently holds have spun off 28 international patents, stimulating the worldwide tissue engineering industry. Her current research team is refining these technologies and developing others, potentially revolutionizing the transplantation industry and eliminating wait lists for life-saving transplantable organs."

NAI selects its honorees by identifying their impact on the welfare of society, the release reads, and have proven success with their patents, licensing, and commercialization.

NAI Senior Members are active faculty, scientists and administrators from its Member Institutions who have demonstrated remarkable innovation producing technologies that have brought, or aspire to bring, real impact on the welfare of society. They also have proven success in patents, licensing and commercialization.

An individual's nomination for the NAI Senior Member class by its supporting institution is a distinct honor and a significant way for the organization to publicly recognize its innovators on a national level.At their host institutions, Senior Members foster a spirit of innovation, while educating and mentoring the next generation of inventors.

The new class of NAI Senior Members includes representatives from 32 institutions. Texas A&M University has two researchers in the class — Robert Balog, an associate professor in the Department of Electrical and Computer Engineering, and Balakrishna Haridas, a professor of practice in the Department of Biomedical Engineering and executive director for technology commercialization and entrepreneurship for the Texas A&M Engineering Experiment Station.

This latest class of NAI Senior Members represents 32 research universities and government and non-profit research institutes. They are named inventors on over 860 issued U.S. patents. In February, two Houston inventors were named to the inaugural class of senior members.

"NAI Member Institutions support some of the most elite innovators on the horizon. With the NAI Senior Member award distinction, we are recognizing innovators that are rising stars in their fields," says Paul R. Sanberg, NAI president, in the release. "This new class is joining a prolific group of academic visionaries already defining tomorrow."

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Report: These 10 jobs earn the biggest salary premiums in Texas

A move to Texas bolsters earnings for some, and a new SmartAsset study has revealed the top professions where the median annual earnings in the Lone Star State exceed the national median.

The report, "When it Pays to Work in Texas — and When It Doesn’t," published in April, analyzed over 700 occupations to determine which have the biggest "Texas premium" — meaning jobs where the price-adjusted median annual pay in Texas most exceeds the national median for the same occupation — and which jobs have the biggest “Texas penalty,” where the statewide median annual pay falls furthest below the national median. Salaries were sourced from the U.S. Bureau of Labor Statistics (BLS) and adjusted for regional price parity.

According to the report's findings, geoscientists have the biggest "Texas premium" and make a $159,903 median annual salary. Texas' salary for geoscientists is 61 percent higher than the national median for the same position (after adjusting for regional price parity).

"Texas’s large petroleum industry helps explain why employers in the state retain so many geoscientists," the report's author wrote. "In fact, the Lone Star State is home to more geoscientists than any other state except California."

There are more than 3,600 geoscientists working in Texas, SmartAsset said.

These are the remaining top 10 occupations with the biggest "Texas premiums" (salaries are price-adjusted):

  • No. 2 – Commercial pilots: $167,727 median Texas earnings; 37 percent higher than the national median
  • No. 3 – Sailors: $67,614 median Texas earnings; 36 percent higher than the national median
  • No. 4 – Aircraft structure assemblers: $83,519 median Texas earnings; 35 percent higher than the national median
  • No. 5 – Ship captains: $108,905 median Texas earnings; 27 percent higher than the national median
  • No. 6 – Nursing instructors (postsecondary): $100,484 median Texas earnings; 26 percent higher than the national median
  • No. 7 – Tax preparers: $63,321 median Texas earnings; 25 percent higher than the national median
  • No. 8 – Chemists: $104,241 median Texas earnings; 24 percent higher than the national median
  • No. 9 – Health instructors (postsecondary): $128,680 median Texas earnings; 22 percent higher than the national median
  • No. 10 – Engineering instructors (postsecondary): $129,030 median Texas earnings; 22 percent higher than the national media

The careers where Texas workers earn less

SmartAsset said an editor is the Texas profession where workers earn the furthest below the median for the same occupation elsewhere in the U.S. Not to be confused with film and video editors, BLS defines editors as those who "plan, coordinate, revise, or edit written material" and "may review proposals and drafts for possible publication."

The study found editors make a price-adjusted median wage of $29,710, which is 61 percent lower than the national median for the same position, and there are nearly 8,200 editors in Texas.

It's worth noting that the salaries for editors may be skewed by the fact that there are not major publications in rural areas of Texas, and other professions may also have financial deviations for similar reasons.

Several healthcare jobs also appear to have the worst penalties in Texas compared to elsewhere in the country. Home health aides are the second-worst paying professions in the state, making a median wage of $24,161.

"More home health aides work in Texas than in nearly any other state, with only California and New York employing more," the report said. "However, the more than 300,000 Texans in this occupation earn median annual pay that is about 31 percent below the national median, after adjusting for regional price parity.

SmartAsset clarified that pay penalties are not consistent "across the board" for other healthcare occupations in Texas.

"For physical therapy assistants, occupational therapy assistants, and postsecondary nursing instructors, Texas may be an especially strong place to work, with these occupations offering 'Texas premiums' of between 17 percent and 26 percent," the study said.

These are the remaining top 10 occupations where median annual earnings in Texas fall furthest below the national median for the same occupation:

  • No. 3 – Cardiovascular technicians: $49,382 median Texas earnings; 27 percent lower than the national median
  • No. 4 – Semiconductor processing technicians: $38,295 median Texas earnings; 25 percent lower than the national median
  • No. 5 – Tutors: $30,060 median Texas earnings; 25 percent lower than the national median
  • No. 6 – Control and valve installers: $56,496 median Texas earnings; 24 percent lower than the national median
  • No. 7 – Mental health social workers: $46,109 median Texas earnings; 23 percent lower than the national median
  • No. 8 – Clinical psychologists: $74,449 median Texas earnings; 22 percent lower than the national median
  • No. 9 – Producers/directors: $65,267 median Texas earnings; 22 percent lower than the national median
  • No. 10 – Interpreters/translators: $46,953 median Texas earnings; 21 percent lower than the national median

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This article originally appeared on CultureMap.com.

Houston rises in 2026 ranking of best U.S. cities to start a business

Best for Biz

Houston has reaffirmed its commitment to a business-friendly environment and now ranks as the 26th best large U.S. city for starting a business in 2026. The city jumped up eight places after ranking 34th last year.

WalletHub's annual report compared 100 U.S. cities based on 19 relevant metrics across three key dimensions: business environment, access to resources, and costs. Factors that were analyzed include five-year business survival rates, job growth comparisons from 2020 and 2024, population growth of working-age individuals aged 16-64, office space affordability, and more.

Florida cities locked out the top five best places in America for starting a new business: Tampa, Orlando, Jacksonville, Hialeah, and St. Petersburg.

Houston's business environment ranked as the 19th best in the country, and the city ranked 51st in the "business costs" category. However, the city lagged behind in the "access to resources" ranking, coming in at No. 72 overall. This category examined metrics such as Houston's working-age population growth, the share of college-educated individuals, financing accessibility, the prevalence of investors, venture investment amounts per capita, and more.

"From the Gold Rush and the Industrial Revolution to the Internet Age, periods of innovation have shaped our economy and driven major societal progress," the report's author wrote. "However, the past few years have been particularly challenging for business owners in the U.S., due to factors such as the COVID-19 pandemic, the Great Resignation and high inflation."

Earlier this year, WalletHub declared Texas the third-best state for starting a business in 2026, and several Houston-area cities have seen robust growth after being recognized among the best career hotspots in the U.S. Entrepreneurial praise has also been extended to five local companies that were named the most innovative companies in the world, and six powerhouse female innovators that made Inc. Magazine's 2026 Female Founders 500 list.

Texas cities with strong environments for new businesses
Multiple cities in the Dallas-Fort Worth Metroplex can claim bragging rights as the best Texas locales for starting a new business. Dallas ranked highest overall — appearing 11th nationally — and Irving landed a few spots behind in the 16th spot. Arlington (No. 23), Fort Worth (No. 30), Plano, (No. 35), and Garland (No. 65) followed behind.

Only six other Texas cities earned spots in the report: Austin (No. 24), Lubbock (No. 36), Corpus Christi (No. 39), San Antonio (No. 64), El Paso (No. 67), and Laredo (No. 76).

Austin tied with Boise, Idaho and Fresno, California for the highest average growth in the number of small businesses nationally, while Corpus Christi and Laredo topped a separate list of the U.S. cities with the most accessible financing.

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This article originally appeared on CultureMap.com.

Houston humanoid robotics startup taps Amazon veteran to lead manufacturing

new hire

Persona AI, a Houston-based startup that’s developing AI-powered humanoid robots for manufacturers and other businesses, has hired Brian Davis as head of global manufacturing.

Davis previously guided teams at Amazon Robotics and Dell Technologies. During his tenure at Amazon Robotics and Dell, both companies saw major increases in manufacturing volumes within a four-year period. Davis oversaw manufacturing, supply chain, logistics, quality assurance and real estate.

“Davis steps into this role [at Persona AI] as industrial enterprises face an urgent and accelerating challenge: a structural shortage of capacity for welding, fabrication, and heavy maintenance in dynamic environments, precisely the high-value, high-risk tasks where humanoid robots can deliver the greatest impact,” according to a company news release.

Davis comes aboard as Persona AI, founded in 2024, seeks to meet demand generated by deals with HD Hyundai and POSCO Group to make humanoids for shipyards and steel plants, and by a pilot program with the State of Louisiana.

“Now is the perfect time to accelerate our production capabilities as we rapidly close the gap between what’s possible in the lab versus what’s driving real commercial value,” Davis says.

“Building industrial-rated humanoid robots and production-deployable AI is only one piece of the puzzle,” he adds. “Producing humanoids at scale will require systematic supply chain management, stringent quality control, and building the playbook for safe, high-volume manufacturing. That’s what I’m here to build.”

Last year, Persona AI raised more than more than $10 million in pre-seed funding. The company also named a new head of commercial strategy in March.
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