How Oculus Rift could transform Facebook (FB) into tech juggernaut

Rift presents some unique business opportunities that could transform Facebook’s core business away from advertising. Here’s how.

Facebook just dumped $2 billion ($400 million of it in cash) into its acquisition of virtual reality headset maker Oculus Rift. The news took some time to sink in for me. First, I thought about the possibilities. There are myriad applications for the device: gaming, education, shopping, communication and entertainment to name a few. Then, I thought about the business opportunity Rift presents and how it might impact Facebook’s stock price. A few things clicked:

1) Advertising is just one of many revenue opportunities. Sure, advertising will be possible: from commercials in the middle of immersive tv shows, sporting events and movies to in-game ads. I don’t think that’s key, though. Facebook already generates 90 percent of its revenue from advertising. Ultimately, the company views itself as a connection platform, not an ad agency.

2) Rift as a communication platform. Facebook CEO Mark Zuckerberg touts rift as a communications platform. That idea has potential, but it’s a long way off. After all, to use it as a communication platform you and the people you want to communicate with will need Rifts, too. It took a decade for cell phones to fully penetrate the developed world (from 18 percent adoption in 1997 to 97 percent adoption in 2007). I would guess that Rift-to-Rift communication is a long way off – at least five years.

Here’s where I really think Facebook could make money off Rift:

3) The Rift app store. Apple’s App Store generated $10 billion in revenue for Apple (AAPL) last year and made the company $1 billion in profit. Most of that money was generated by low-cost games and productivity apps. If Facebook enhances and helps develop Rift’s app store, I suspect it could quickly eclipse App Store sales (if not in the number of apps sold then definitely in the amount of revenue generated). The App Store models works so well for Apple that Microsoft (MSFT) copied it with the launch of its own app store in Windows 8. Droid has an App Store, Kindle’s got a store, xBox has a Marketplace, etc. A Rift app store would generate lots of cash, and, best of all, outsource the development of apps to others. If Rift apps catch on, Facebook’s $2 billion acquisition will look cheap in the years to come.

50 ways Microsoft’s (MSFT) new CEO can revolutionize the company and take down Apple (AAPL)

Here are 50 paths Microsoft could take to build revenue, delight customers and begin telling itself (and the world) a fresher, more fascinating story.

The best corporations tell themselves stories that are persistent and unyielding. They’re filled with twists and turns, but they move inexorably ahead toward a faraway goal.

I believe that Microsoft’s (MSFT) story has morphed into a tale of incremental improvements. Yes, the giant still marches the face of the earth slaying foes, but his steps have gotten heavy. His shoulders are sore and his eyes have drooped.

We must hoist up to him a 5-Hour Energy the size of an oil drum. We must drink with him to some spectacular new future where Microsoft takes a moonshot and succeeds; one where the company is rechristened as the greatest technology company on the face of the planet.

Here are 50 paths I’d love to see the company explore; 50 ways Microsoft might build revenue, delight customers and begin telling itself (and the world) a fresher, more fascinating story. Particularly radical ideas are in bold:

  1. Invest in lip-reading technology that could rival Siri and be used to compose emails and other text in a corporate setting.
  2. Build a spherical (omni-screen) gaming system; a ball-shaped 360-degree, ceiling-mounted pull-down screen that works in conjunction with two projectors and immerses the player in his or her gaming environment.
  3. Build the world’s first high-powered mobile IDE for developers with a cloud-based subscription model running on virtual machines.
  4. Build a flying Bluetooth-controlled camera that can take photos of it’s owner based on the location of his or her phone. The device could constantly record (similar to a head-mounted camera), and it would follow or travel in front of the owner in the air.
  5. Buy spotify to take on Apple (AAPL) as the king in mobile music. Partner with radio news apps (i.e. Stitcher) to cut into Apple’s stranglehold on the podcast market.
  6. Develop smart glasses, or, at the very least be aggressively developing apps for Google’s hardware.
  7. Develop apps for the iWatch with an emphasis on integration with Outlook.
  8. Make Outlook web-based, and expand its social networking, content delivery and calendar functionality.
  9. Integrate voice commands into all desktop applications. There’s the potential to use a freemium model for this service (10 free minutes a month, for example).
  10. Explore how to integrate gaming with live television. For example, Jeopardy viewers could be competing directly with the contestants on TV. Or Madden fans could be competing nationwide as they attempt to call plays in live games before they’re run. The most accurate play-callers would win.
  11. Embed Kinect in laptops and monitors to integrate gestures with core Microsoft software.
  12. Aggressively pursue Bloomberg’s audience in the financial data space. It’s time that world-class financial data get pumped out over the web — not on proprietary terminals. Investors have deep pockets (just check out Michael Bloomberg’s net worth).
  13. Push all of Microsoft’s flagship applications onto the cloud. If you don’t catch up with Google Docs and Google Spreadsheets, you’re going to lose serious revenue.
  14. Consider buying Adobe to deepen your stranglehold on development software. Adobe also has a nice cloud-based software-delivery system (though, eventually, programs like Photoshop will be running in the cloud, not on local machines).
  15. Re-imagine Excel as a web tool that can publish beautiful embeddable reports on the web with the click of a button. Currently you can make nice charts, but users should be able to make online, interactive data tables and charts just as easily. Excel’s data should be beautiful and highly interactive, even if you’re not a programmer.
  16. Buy Basecamp, Trello or another up-and-coming software collaboration site, then port that usability into TFS. Or at least give TFS a serious re-design that makes it faster to roll-out and test software.
  17. Expand virtual box services for software testing. Testing is extremely difficult now that developers have to support so many devices (tablets, desktops, phones, TVs, watches, glasses, etc.). The only – ONLY – way this is going to be doable is with virtual test environments. Developers will pay serious cash for serious emulators.
  18. Build a “business marketplace” where corporations can easily outsource things like testing, and integrate it with TFS (or the next iteration of TFS).
  19. Integrate Kinect and voice-to-text with smart glasses to destroy the smartphone.
  20. Build a Roku competitor that ships free with Microsoft computers. Make a deal to deliver premium sports content over the network. Any Roku competitor should be extremely easy to control with a laptop, tablet or phone, and it should allow users to run apps on the screen (especially social apps) while also watching TV.
  21. Make Word, PowerPoint and SharePoint themes much easier to install, and then create an online marketplace for buying/selling them.
  22. Build a theme marketplace for Microsoft’s OS, phones, tablets and Xbox.
  23. Buy Fitbit and integrate it into Microsoft’s cross-platform operating systems.
  24. Invest more in help documentation and tutorials to make coding on Microsoft’s platforms easier. Common functionality in Surface apps, for instance, should have drag-and-drop interfaces and very extensive code libraries.
  25. Stop being afraid to make a true Surface/laptop combo that ingrates touch screen with standard inputs.
  26. Create a simple interface for controlling drones. Allow consumers and small businesses to purchase and schedule drone usage time through a national network of Microsoft-branded drones.
  27. Capture and store user data across devices (phone, mobile and tablet), then feed that data back to users so they can see their activities over time and look for ways to increase their productivity.
  28. Release free, ad-supported mobile phones.
  29. Rollout Stackoverflow-style forums that are integrated with Microsoft’s core apps.
  30. Rollout an aggressive venture capital program to fund start-ups (and grab an equity stake in the process).
  31. Create a marketplace for resume templates in Word.
  32. Create a marketplace for code plugins.
  33. Develop easy-to-install circuits for home electrical appliances, and release apps to control them.
  34. Build a social network into windows 9, something that provides optionally shareable data on a user’s computer activity. This would be great for social and professional purposes (i.e. Microsoft-certified “Time in Application”). There’s so much activity that we do on our computers that’s never quantified or analyzed.
  35. Build a freemium-model API for voice-to-text services so programmers can integrate Siri-style services into Surface and xBox apps (and maybe some of them will even pursue programming conversational robots).
  36. Develop a holographic TV that works using Pepper’s Ghost. Theoretically, this could be done if video broadcasts shot two layers of film: background and foreground. For example, if a station were broadcasting a football game, the field would be sent as one layer (the background for Pepper’s Ghost), and the foreground layer would contain the 3D players.
  37. Improve Windows Phones so they can guess what you’re doing all day. It would work by asking you what you’re doing when it’s not sure. Each activity would leave a signature based on time of day, geo-location and movements. Then, this information could be sent back to users for analysis.
  38. Award grants for app development. The apps would then be exclusively developed for Windows for a predetermined amount of time.
  39. Build the worlds first mainstream 3D printer.
  40. Integrate face-time messages/recordings in Outlook.
  41. Create a premium newsletter feature (ala ConstantContact) that’s integrated in Outlook and allows users to broadcast messages to thousands.
  42. Rethink email. Static text emails should be a thing of the past. We need embedded polls, to-do lists, videos, text-to-voice readers that let you listen to emails on the go, etc. The messages would automatically downgrade for text devices (similar to responsive web design).
  43. Buy Dropbox to take SkyDrive mainstream.
  44. Integrate second screens in laptops or Surface keyboards that show metadata on open apps, alerts and/or give you the ability to quickly switch between open applications.
  45. Use SkyDrive to make publishing to the web easy for anyone. A Word doc that’s on SkyDrive should be elegant on any device (think of Amazon’s Reader, which can be used across platforms).
  46. Make an easy way for users to do repetitive tasks on a computer. In essence, the OS should have a “record button” I could use to teach my computer how to do a task or series of tasks.
  47. Build “Application Analytics” that run on the OS level and allow corporations to identify where employees are spending their time and how they can improve efficiency.
  48. Develop a smart-screen or smart-glass augmented reality gaming system that attaches to the wearer’s head and can integrate with the real world by overlaying opponents in your actual environment.
  49. Add NFC to future Microsoft phones.
  50. Create a secure payment-processing platform for Bitcoin.

Got any additional ideas for Microsoft?

Please add them to the comment section below, and I’ll repost them.

A new way to invest in private companies with CircleUp

A new way of investing: CircleUp could prove to be the leader in crowdfunding if the SEC gives it its blessing.

It’s tantalizing to imagine getting shares in a start-up that might go on to become the next Google. That’s part of what draws us to sites like Kickstarter.com where everyday people can pledge cash investments in start-up projects in exchange for recognition and swag.

Still, it’d be nice to get more than swag for laying hard-earned cash on the line. That’s the idea behind crowdfunding – fundraising for private companies in exchange for a stake in the company. Unfortunately, wide-scale crowdfunding is yet to materialize due to complex regulatory issues set by the SEC and other securities agencies.

At the moment, investing in private businesses is limited to what the SEC calls “accredited investors.” That includes banks, investment companies and wealthy investors. The idea is that since private companies don’t have to publicly disclose their earnings information, retail investors could get duped into dumping cash into a bottomless pit. By setting rules for accredited investors, the SEC limits investing in private companies to savvier investors and institutions since they should be more familiar with the unique risks that start-ups bring.

Whether or not that’s true, it seems like the onus should be on the buyer, not the government to tell us what we can and can’t investment in. Passage of the JOBS Act has crowdfunding fans hopeful things are about to change, too.

And there’s one company in particular that’s leading the charge: CircleUp.com. CircleUp vets consumer and retail start-ups that are looking to raise up to $1 million. If that start-up meets CircleUp’s criteria and has $1 to $5 million a year in revenue, CircleUp opens up investment opportunities in that company.

Right now, CircleUp is limited to accredited investors, but “the site may open to unaccredited investors,” per reports from AllThingsDigital. Expect a big surge in interest if that happens.

CircleUp’s model differs from that of competitors like SharesPost and SecondMarket in that it limits offerings to companies that are actually generating revenue. Companies listed on SharesPost and SecondMarket might not have made a dime in the past, and perhaps they won’t ever generate cash in the future.

“Private investments in small businesses are the next step in the evolution that began fifteen years ago with simple consumer transactions on eBay, and have continued with very personal matchmaking for housing and dating on sites like Craigslist and financial transactions through investment brokerage firms and online banking,” CircleUp said in a recent statement.

Gartner Research estimates that crowdfunding will be a $6.2 billion market by 2013. If things go well, expect CircleUp to capture a fair chunk of that pie.

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3 reasons to invest in a Kickstarter IPO

Kickstarter is moving from the geeky fringe into mainstream consciousness, and that has investors taking note. Here are three reasons to consider investing in a Kickstarter IPO if and when we see one.

It’s hard to walk a few steps at my office without hearing someone talking about the latest business idea they saw on Kickstarter.com. It’s a sign the site’s moving from the geeky fringe into mainstream consciousness. And it makes me wish I had the opportunity to buy Kickstarter stock. Here are three reasons to consider investing in a Kickstarter IPO (if and when we see one):

1) A built-in revenue stream. Cash flow is one of the biggest problems with tech start-ups. Couple a high-growth tech company with actual revenue, then, and you’ve got a hot commodity in the Silicon Valley.

Kickstarter has a simple way of raking in cash, too: it takes 5 percent of whatever gets raised. Now that we’ve seen a project pull in more than $6 million in days, Kickstarter’s generating real greenbacks.

2) Phenomenal growth. Kickstarter helped fund 3,910 projects in 2010. That was good for $27,638,318 dollars pledged, and a project success rate of 43 percent (per Kickstarter’s blog). One year later in 2011, Kickstarter funded 46 percent of its posted projects for a total of 11,836 projects worth $99,344,381. Kickstarter’s cut in 2011? $4.97 million.

Per VentureBeat, “Kickstarter is on pace to raise around $300 million this year, triple what it did in 2011.” $15 million of that would go straight to Kickstarter.

3) Investor interest. Deep-pocketed venture capitalists are excited about Kickstarter. When asked what private companies he was eyeing now that Facebook’s going public, Jason Jones, managing partner of High Step Capital, named three companies: Kickstarter, Etsy and Quora (per InsideIPO).

Kickstarter shares aren’t yet available on Secondmarket – a site where wealthy investors can buy and sell shares in private companies – but investors are excited for them to arrive. Interest in Kickstarter shares grew by more than 93 percent in 2011, Secondmarket says.

All that said, the only thing better than a Kickerstarter IPO might be an announcement that the company’s turning itself into a non-profit. That would keep costs down and goodwill up in the years to come. If we don’t get that, though, I’ll take the next best thing: Kickstarter stock.

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How to get rich: Lessons from Africa

There’s this tendency to believe we need a revolutionary idea to get rich. The fact is, most of the world’s millionaires (and billionaires) got rich off of industries we probably thumb our noses at.

This post is part of our long-running “How to get rich” series. Click see all the posts.

There’s this tendency to believe we need a revolutionary idea in order to get rich. The fact is, most of the world’s millionaires (and billionaires) got rich off of industries we probably thumb our noses at: fertilizer companies, trailer parks, and lawncare franchises work just as well as founding the next Zynga, Twitter or Facebook.

A recent article in Forbes drove home this fact when they profiled the Top 3 richest people in Africa. All three of them made their cash off industrial businesses:

1) Aliko Dangote, $10.1 billion in market cap in his cement company Dangote Cement. Also mills flour and refines sugar.

2) Nicky Oppenheimer, $6.5 billion from selling his stake in diamond company DeBeers. Also owns 2 percent of mining giant Anglo American.

3) Nassef Sawiris, $4.75 billion as head of Egypt’s biggest public company, Orascom Construction. Also building a fertilizer plant in Brazil.

There’s no shame in founding a company that does the sort of work no one else wants to do. Commercial cleaning franchises, for instance, often make Entrepreneur magazine’s list of the top franchising companies in the country. Copying an idea that’s proven to work and steadily growing your earnings year after year is the surest way to getting rich. And starting a franchise (rather than going off on your own) should help you avoid the pitfalls most rookies make (see our list of the Top Five Cheap Franchises to start $10,000 or less for some ideas).

One other thing to note: the richest men in Africa (and I can say men because there are no women who made the “top 40” list) are old. They have an average age of 61, according to Forbes. That’s another aspect to getting rich that a lot of people don’t want to admit: it takes a hell of a lot of work and a hell of a lot of time.

One of my high school friends recently left his cozy corporate job to start a software company. It’s doing well, but he’s hardly sleeping. I get emails from his at 4 a.m. He thinks he’s getting an ulcer and his back hurts from “sitting all the time.”

Some weeks, he bills his clients more than 100 hours. That’s 14 hours a day, seven days a week. I ask him why he’s doing it, and he says “I have a plan. I’m going to trash my body for six months and make this work.”

“What if it doesn’t?” I ask.

“Then, I’m going to close down the business and go back to corporate America.”

At least, he’s trying, and that’s what separates him from almost everyone else I know. He’s willing to put in the hours that it takes to reach a goal – even at the expense of a social life and perhaps his health! It’s a tough trade-off, and it’s probably a pretty extreme example, but I think it’s the key to making lots of money.

It’s hard work, and it’s doing the things no one else can or wants to do.

Photo Credit: Nbauer.

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How to get rich: Move to Bismarck, ND, and work in the Bakken oil reserve

Jobs on the Bakken reserve oilfield are paying unskilled workers as much as $120,000 a year. Even a local McDonald’s is paying $20 an hour.

This post is part of our long-running “How to get rich” series. Click see all the posts.

Hindsight is 20/20. I could have went to college and studied programming for mobile phones. I could have been a mid- to senior-level programmer by 2007 when the first-generation iPhone came out. I could have founded a mobile game development company and, well, started driving a Bentley.

No such luck. But I tell that what-if story to illustrate the point that we often identify trends in business long before that trend goes worldwide. But most of us don’t do a damn thing about it. A prime example of this is the newspaper industry. They reported on the Internet every day, while at the same time clinging to a print-first mentality that let younger, more nimble news start-ups steal eyeballs from them on the Web.

Like Wayne Gretzky skating to where the puck is going, we need to identify trends and get on the leading edge of them. This doesn’t mean we need to go to college and learn how to program applications for iPads. Getting on the leading edge of a trend could be as simple as an unemployed person in a town with high unemployment moving to a city where there are lots of high-paying jobs to be had.

Let’s take Bismarck, N.D. for instance. Forbes columnist Rich Karlgaard points out that the discovery of a major oilfield (the Bakken reserve) has lead to a surging job market where “unskilled laborers can make up to $120,000 a year.” The work’s 12 hours a day, seven days a week, two weeks on, two weeks off (and you might have to live in a barracks-like “man camp”), but there’s money to be had. Even a McDonald’s in the town of Williston is paying $20 an hour for counter help.

The whole thing sounds too good to be true. So I got on some job boards and starting looking for oilfield jobs in North Dakota. Lo and behold, I found at least one that’s willing to pay people with no experience up to $80,000 a year. You just have to be able to lift 50 pounds and stay alert for 12 hours in a row. Here’s the posting (and here’s a PDF screenshot of the posting for posterity in case the posting is ever taken down). The pay range is listed in the right-hand column at $50,000-$80,000 a year.

The world belongs to those who see opportunities and find ways to exploit them. It doesn’t matter if those opportunities are in our backyards or 2,000 miles away.

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Five MORE cheap franchises to start with less than $10,000

We can all take a shot at starting our own businesses, and it doesn’t have to cost a lot. Here are five businesses you could launch with very little in the way of capital investment.

This is a follow-up to one of the most popular blog posts on this site: Five cheap franchises to start with less than $10,000. Here are five MORE businesses you could launch with very little in the way of capital investment:

1) Stroller Strides. Stroller Strides offers fitness programs for new moms and their babies. Since the business serves new mothers, it makes sense to have mothers run the company’s franchised outlets. Currently, Stroller Strides boasts of more than 1,200 locations in 44 states. Start-up costs range from $4,000 to $18,000 (per Entrepreneur). www.strollerstrides.com.

2) GarageExperts. GarageExperts helps consumers “unclutter their worlds” by redesigning their garages to maximize storage and cleanliness. The company offers cabinets, floor coatings, racks and more. Start-up costs range from $4,600 to $20,500 (per Entrepreneur). www.garageexperts.com.

3) Buildingstars. A commercial cleaning company based in St. Louis, Buildingstars added 34 new franchisees in 2011. The company’s emphasis on “green cleaning” could be a part of that as it not only lowers costs for businesses, but protects the environment, too. Start-up costs range from $2,200 to $52,800 (per Entrepreneur). www.buildingstars.com.

4) Jazzercise. Jazzercise offers cardio classes that fuse jazz music, Pilates, yoga, and kickboxing for a one-hour workout that burns up to 600 calories. The company now has nearly 8,200 locations across the country. Start-up costs range from $2,980 to $76,500 (per Entrepreneur). www.jazzercise.com.

5) Fairway Divorce Solutions. A company that helps its clients agree on the best financial and custodial options during a divorce, Fairway serves as a mediator during the often-painful process of splitting up. The company added eight locations in 2011. Start-up costs range from $10,000 to 35,000 (per Entrepreneur). www.fairwaydivorcefranchise.com.

Other low-cost franchises include In Home Pet Services ($7k+) and restroom deodorizing company Aerowest/Westair Deodorizing Services ($8.5K+).

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How to start a B Corporation

Certifying your company as a B Corporation isn’t a walk in the park. You’ll have to submit to random audits, pay annual fees and alter the legal structure of your company. But there are a lot of instances where it makes sense.

While you don’t get any special tax benefits (unless you happen to be based in Philadelphia), certifying your business as a B Corporation demonstrates to the world that you company is committed to solving social and environmental problems. I also suspect that in the future, consumers as well as local, state and the federal government will start showing B Corporations preferential treatment (and that means earning the designation could be good for your bottom line AND for the wider world).

Before you run out and sign up, though, realize that becoming a B Corporation isn’t as simple as filling out a registration form and paying an annual due. If you meet B Lab’s requirements for earning the designation, you’ll probably have to modify your company’s legal structure to limit management’s ability to bypass B Corporation values. That means giving a lot more power to your shareholders AND your stakeholders. You’ll also have to agree to random audits designed to verify your adherence to B Corporation standards.

If you’re committed to running a company that doesn’t just make you money but makes the world a better place in the process, here are the steps to earning a B Corporation designation:

1) Register for a B Impact Assessment. Since every industry has different social and environmental impacts, you’ve first got to submit information regarding your industry, business size, revenues, employee hours and more to B Lab (the certifying body for B Corporations). After you’ve submitted this information, your company will receive a specific B Impact Assessment form to complete. You can register to receive the appropriate B Impact Assessment form here.

2) Complete your B Impact Assessment. After completing your registration, you’ll be sent a custom username and password that you can use to complete your industry and business size’s specific B Impact Assessment. Before beginning, you may want to assess how transparent you’d like to be with your business practices. B Impact Assessment’s are freely available to the public.

3) Review your survey with a B Lab staff member. You’ll need to walk through all of your Impact Assessment answers with a representative from B Lab so he or she can be sure you correctly answered all the questions on the form.

4) Supply documentation verifying your assessment answers. To get certified, your company will have to supply B Lab with documentation verifying roughly 20 percent of your answers to the survey questions. If you can’t verify key questions on the survey, your certification will be denied.

5) Modify your company’s legal structure. If the results of your survey are approved, you’ll have to modify your company’s legal structure to institutionalize stakeholder interests in your business. B Lab provides a legal roadmap to help you do just that. Visit the page linked above to select the type of corporation you run and the state where you’re incorporated. B Lab will provide you with reference language to help you update your company’s legal structure.

6) Sign your new B Corporation documents. If your company is approved as a B Corporation, you’ll have to sign a term sheet specific to the state where you’re incorporated.

7) Set aside funds to cover your company’s B Corporation certification. Fees for B Certifications vary based on the annual revenue at your company. The cost ranges from $500 a year for a company with less than $2 million a year in sales to $25,000 a year for companies with more than $100 million in sales.

8) Be prepared for random audits. One in five B Corporations (20 percent) are randomly selected for audits every two years. Should your company be audited, you’ll be expected to verify all of the information you submitted while filling out your B Impact Assessment survey. If you fail the audit, your company runs the risk of being publicly de-certified (and no one wants that!).

How much does it cost to become a B Corporation?

At the time of this writing, fees for B Corporation certification are based on your annual sales as follows:

Annual Net Sales Annual Fee
$0 – $1,999,999 $500
$2 M – $4,999,999 $1,000
$5 M – $9,999,999 $2,500
$10 M – $19,999,999 $5,000
$20 M – $99,999,999 $10,000
$100 M + $25,000

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How to file a patent

Here are eight tips on how to file a patent whether you choose to file on your own or by using a patent attorney.

Got a great idea you want to patent? Chances are, you’re thinking about the rewards that it will reap you. In an ideal world, your discovery is so revolutionary that a Fortune 500 company’s willing to license it, then sign and deliver checks to your mailbox every month. A patented idea can be as good as money in the bank if it’s something the marketplace genuinely needs.

The truth is quite a bit more sobering, though. Estimates range from one in every 500 to one in every 5,000 patents that actually end up becoming commercially successful (per InventionStatistics.com). Those aren’t good odds, and that makes it all the more important that you think through you decision to file a patent and fully commit to your idea before moving forward.

A recent article in Entrepreneur magazine estimates that the most basic patents cost anywhere from $7,000 to $15,000 in attorney fees, take hundreds of hours in paperwork and can take up to six years to get approved.

If you’re still committed to forging ahead, though, here are eight tips on how to file a patent:

1) Decide whether or not you really need a patent. In theory, you’d think filing a patent on your brand new idea is a no-brainer. In practice, though, there are plenty of reasons why you might not need or want to file a patent. Think about the following factors before deciding whether filing is really going to pay off:

  • Will your design still be relevant in three to six years? If your design applies to a fast-changing field like technology, odds are, it’ll be out-dated before the patent office even looks at your application.
  • Are you certain you can turn your idea into cash? If at all possible, prove that your idea has legs before taking on a second mortgage. Hire a web designer to build a site advertising a product that’s similar to your idea, then track the number of visits and social buzz it builds.
  • In my experience, plenty of great ideas fail, and plenty of terrible ideas succeed. It all has to do with the commitment and passion of the inventor. Assess whether you realistically have the time, energy and focus to devote to marketing, filling out forms and meticulously documenting your invention. On top of that, will you be able to market your idea, even if it’s rejected by the marketplace for months or years?

2) Choose your approach. Filing a patent is a difficult process – particularly for the uninitiated. If you’ve got the commitment and gumption to go it alone, the DIY route is doable. Entrepreneur says to budget at least 150 hours to file your patent over several months (and anticipate lots of additional work in the years to come). Based on some digging I’ve done online, it looks like you should be able to file your own patent for somewhere around $3,000, payable throughout different stages in the patent process.

3) Find a patent attorney. The United States Patent and Trademark Office maintains a list of registered patent attorneys by geographic region. Search the list by state to find several attorneys in your area. Call around to find one that specializes or at least has experience in your specific industry.

4) Determine the type of patent you’re going to file. Currently, they fall into three categories: 1) Utility applications for a “new and useful process, machine, article of manufacture, or compositions of matters, or any new useful improvement thereof”; 2) Design applications for a “new, original, and ornamental design for an article of manufacture”; and 3) Plant applications for “anyone who invents or discovers and asexually reproduces any distinct and new variety of plant.”

5) Research the process for your specific type of patent. The U.S. Patent Office’s web site is a treasure trove of information. Depending on the type of patent you plan to file, you can click on the links below to start reading through background information, download forms and get guidance on the next steps to patent your idea:

6) Electronically file your patent. Once you’ve put together all the drawings, written descriptions (aka “claims”) and filled out all the relevant forms, you can submit your patent application online at on the Patent Office’s EFS-Web site.

7) Wait for a response. You should hear back from the patent office somewhere between 18 and 36 months after you’ve submitted your patent application. In most cases, they will have rejected your patent (according to Douglas Baldwin) because of competing patents that have already been accepted. Don’t get discouraged. The Patent Office should give you specific reasons why your patent is too similar to those existing patents, though, and you’ll have three months to organize and file a detailed appeal.

8) Wait for the results of the appeal. In one to two years, you should get a final response to your appeal. If your patent was rejected, you can appeal yet again, but we’ve got our fingers crossed for you. Hopefully, you’ll be the proud owner of a patent. And then the real work truly begins.

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Three reasons to invest in the Square IPO (when it finally arrives)

Here are three reasons to invest in the Square IPO, even before we’ve gotten a chance to look at any financial documents.

One of the more exciting start-ups in the tech space comes in the form of a pocket-sized, half-inch plastic square. Said plastic square can be plugged into the audio jack on your iPhone, Andoid, iPod or iPad and transformed into a mobile credit card processor. That’s the premise behind Square – an inspiring start-up with 100 employees based in San Francisco. The IPO rumors haven’t started up yet, but there are lots of reasons to be excited about this small company (even before we’ve gotten a chance to look at any financial documents). Here are three reasons to invest in the Square IPO (when it finally arrives):

1) Leadership. Investing icon Warren Buffett argues that you shouldn’t invest in companies but rather people. “You can have the greatest goals in the world, but if you have the wrong people running it, it isn’t going to work,” he said recently. “On the other hand, if you’ve got the right person running it, almost anything is possible.”

Without question, Square’s got an excellent pedigree. One of the company’s co-founders, Jack Dorsey also co-founded Twitter, rising at one point to serve as CEO (he’s now a chairman working on product development and growth). That takes up a mere 8 to 10 hours of his day. After that, he ambles down the road to clock another 8 to 10 hours of work at Square.

“Most people have major positions at companies and they’re also raising families,” Dorsey told Fortune last week. “They have two-year-olds. I have it easy.”

Best of all, Dorsey seems to possess a sense of a wonder that he uses to inspire the developers working below him. He does that in part with his weekly “town square” meetings where he takes 15 minutes or so to talk values and aspirations with his employees.

In a recent town-square meeting, he compared what Square’s doing to building the Golden Gate Bridge: “Every single aspect of this is gorgeous,” he said (per TechCrunch). “So your homework this weekend is to cross this bridge, think about that, and also think about how we take those (design) lessons into doing what we do, which is carry every single transaction in the world.”

2) The volume game. Numbers aren’t readily available, but we do know that Square is “processing millions of dollars in mobile transactions every week,” according to NPR. Let’s conservatively say the site’s processing $2 million in transactions weekly. That’s good for more than $225,000 in revenue. Not bad for a company that just opened its doors to clients nine months ago. The key here is scale. By poaching a huge number of transactions and reaping 2.75 percent of every sale, the company needs to consistently grow it’s user base to move toward profitability. The numbers look good so far.

3) The writing on the wall. Your head is planted firmly in the sand if you’re not convinced that credit cards are going the way of the dodo bird. In fact, I’d argue that it’s not just your head that’s buried in sand; it’s your torso, midsection, legs and feet, too. The smartphone is transforming into a mobile wallet. Every major credit card company in the world has started forays into the mobile payment processing realm and few have made it as simple as Square.

Merchants get their card readers for free. They pay no monthly fees, and they can use it as little or as often as they like. In fact, we might even use it to give our friends a few bucks for the cab we’re sharing one day. If Square can keep gobbling up marketshare while PayPal, Visa, Mastercard and others are still scribbling on whiteboards, they’re either going to IPO or get bought out. And either scenario will likely be a boon for shareholders.

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