Are Patent Trolls Scaring Off VCs?

MIT study finds correlation between patent litigation and decreased venture capital funding

A new MIT study, featuring Apps Alliance members X-Plane, Ditto, and Jump Rope, suggests patent trolls are killing startup funding. The study finds that between $8.1 billion and $41.8 billion of VC investment has been lost over the course of five years as a result of patent litigation from “frequent litigators.” 

“Frequent litigators” were defined as companies that filed twenty or more patent lawsuits. That number was intended to capture patent trolling behavior. 

The study presents concrete, empirical evidence that patent trolling is drying up VC investment in startups.  

The study is authored by by Catherine Tucker of MIT’s Sloan School of Management.

Read the study

Read more in Ars Technica