How to earn by filing Patents? (USPTO) [with calculations]

Patents are the biggest source of income for researchers/ inventors and many engineers are unaware of this. You can earn just by filing patents in the following ways:

  1. Join a Company and File Patents
  2. File Patents as a University Student
  3. File Patent independently and sell license

We will dive into the points deeper.

Join a Company and File Patents

In a Company, employees raise an Invention Disclosure for review. Invention Disclosures are reviewed and a decision is made to file it. If an employee's Invention Disclosure is filed as a patent, the employee receives a compensation from the Company.

A company pays its employee for a filed patent because patents are valuable for a company. When the valuation of a company is done suring acquisition, then patents play a major role.

See this: Example of Software Patents that are most profitable

Usual earnings:

  • On Filing a Patent: $1500
  • When Patent is published: $1500
  • If Patent finds significant use: $10,000
  • If Patent becomes a game changer: $25,000

Assume that a person A is a prolific inventor and has filed 100 patents and all are published. Of these, 5 find significant use and 1 becomes a game changer. This is reasonable and there are at least 1000 such inventors in USA.

In this case, the earnings of person A will be:

  1. Patent filing: 100 x $1500 = $150,000
  2. Patents Published: 100 x $1500 = $150,000
  3. Significant Patents: 5 x $10,000 = $50,000
  4. Game Changing Patent: 1 x $25,000 = $25,000
  5. Total earning: $375,000

Hence, by filing 100 patents, you can expect to earn $375,000. Filing 100 patents may take 4 to 7 years on average.

There are inventors who have over 800 patents. Based on our calculations, they may have earned over $3,000,000 = $3M.

Hence, if you want to earn $1M by filing patents while working at a company in USA, then you need to file 266 patents on average.

Indirect benefits of filing a patent through your company include:

  • Considered for promotions.
  • Considered as a researcher or active contributors in the company.
  • Better offers while switching companies.

File Patents as a University Student

As a University Student, if you file patents, you do not earn anything directly. If the patent is for a research work at your University, the patent will be owned by your University and you will be listed as an Inventor.

This was the case of Google.

Google founder, Larry Page invented the PageRank Algorithm during his PhD at Stanford University. Stanford University decided to patent the algorithm and later, Larry Page went on to launch the Google Search Engine using the algorithm.

Larry Page had to buy license for his own algorithm from Stanford University using $1.8M in stocks in 2000. Later in 2005, Stanford University sold the stocks for $338M. Hence, filing patents as an University Student is not feasible.

If you file patents through your University, your University will take care of application fee. Indirect benefits you may get include:

  • Patent considered as a contribution towards your PhD
  • An award for Patent (may include cash prize)
  • Patent filing will make you a notable student and get highlighted in placements.

You can file patents independently but this requires money for application fee and if you are unable to use the patent to earn money, your profit is in negative. This case is covered in our next point.

File Patent independently and sell license

If you file a patent independently, there are two paths:

  • File through a Patent attorney (Relatively easy process)
  • File on your own (Time consuming process)

Both paths require you to pay the application fee of filing a patent at USPTO (usually $2000). In the first path, you need to pay the attorney (usually $2500 to $5000) as well. So, you need to spend some money if you want to file a patent independently.

Once your patent is filed, there are some options you can take to earn money from it:

  • Sell the license to a Patenting Company
  • Sell the license to an interested company in the same market
  • Develop a product
  • Identify use of your Invention and get into a partnership

We will dive into the points further.

  • Sell the license to a Patenting Company

A Patenting Company buy license of large number of patented inventions and also, patent new inventions. They works toward identifying the use of the invention in commercial and open-source products. Once identified, the Patenting Company sues the Company that uses the invention in order to get money from fines or get into a monetary compromise outside court.

Such companies are controversial but is any easy way to earn some money for the Inventor. Depending on your patented invention, you can earn from $1000 to $50,000.

  • Sell the license to an interested company in the same market

The process is to identify companies that are likely to benefit from your invention, approach them and present your idea and how it can benefit them.

If everything works well, you can get into a partnership with the company.

  • Develop a product

The idea is to use your Invention and develop a commercial product. If it runs well, then you will earn profits and your company can be acquired by a large company in the market as well.

  • Identify use of your Invention and get into a partnership

This process is time-consuming and involves that you need to identify the product when your invention might be used. Once you are sure, you can approach the company to get into a possible partnership or sue the company to get money as fines.

These are time-consuming processes for an Inventor and the best way is to create a product using your patent.


There are several ways you can earn from patents even if your patents are ordinary. You need not have an extraordinary invention to earn from it.

With this article at OpenGenus, you must have a strong idea of this untapped resource of patenting for many. Go for it.