Last week, Life360, the company I co-founded in 2008, raised $50 million in Series C financing and signed a strategic partnership with ADT Security Systems to partner on the connected home.
It was an exciting week for our scrappy team of 50, all of whom have been working hard for years to build a location and communication app used today by more than 33 million families around the world.
After the excitement of receiving substantial buzz in the media and industry, the dark side of the startup experience reared its ugly head. We received a request from a Florida-based entity, AGIS, to “discuss” a licensing agreement associated with a set of patents they say they own. Under their read, it seemed like the patents could impact any app that shows a location marker on a map.
I had never heard of this company before, so I looked into who they are. This is what I found out. AGIS has a phone number that goes to an anonymous voicemail. It has a headquarter address that links to a home in a residential neighborhood of Jupiter, Florida. I could not find any AGIS employees on LinkedIn. I couldn’t find anything that showed that AGIS still actually sold products or services at all. What I do know is we don’t compete with them, and they are nowhere on my radar.
The bottom line is that AGIS is engaging in a shakedown to take advantage of Life360’s success.
Unfortunately, this isn’t the first time I’ve received such a letter, and I know many of my colleagues can say the same. In the past, I’ve paid the “tax”, or what feels like one, and settled because it’s easier to write a check for $10,000 and get rid of problems that distract us from our business mission. To me, these people are patent trolls who do nothing but stall innovation.
Many start-ups simply do not have the resources to go to court, and risk losing the company or a huge chunk of capital if they take on these patent trolls. Patent trolls know this, and they prey on new targets again and again.
When I got AGIS’ request, my response wasn’t the usual legal-approved, cordial language. You can check out my Twitter feed (@ChrisHulls) if you’re interested in the specifics of how I aired my frustration, but suffice to say I’m tired of being bullied by companies like AGIS. We will no longer engage them or their meritless allegations. Over the past few days, as my response has circulated online, I have been blown away by the outpouring of support from my peers and others in the tech community. I think I struck a nerve in an entrepreneurial community that has had enough of the nonsense that entities like AGIS and troll-like behavior creates.
My primary reason for taking this public is to shine the spotlight on this issue and encourage other companies in similar positions to do the same. No one wants to willingly engage in costly litigation, but there comes a point where you have to stand up for what’s right, and do what’s best for your business and the ecosystem of innovation we are all a part of.
I’m also going take this fight one step further. If AGIS doesn’t agree to give a free license to this patent to all non-competing startups like Life360, I plan to bring in a legal team to invalidate not only the patent in question, but every other piece of intellectual property owned by the corporation and its founder, Malcom Beyer.
The reasoning for this strategy is simple: these types of companies expect a methodological and economically rational response to their claim; in fact they count on this. By taking an offensive approach, we break the calculus that is at the core of the “behave like a patent troll” equation. If, as a community, we all start going on the offensive, these bullies will have no option but to go away.
We’re still a long way off from legislative protection against trolls and true patent reform. In fact, earlier today patent reform took a hit when a bill meant to stop trolls was pulled because it was unlikely to make it through the Senate.
I am hoping that entrepreneurs everywhere support this effort because doing this won’t be easy and it won’t be cheap, but it is important for our community to send a message loud and clear that we aren’t going to take it anymore.
Patent trolls are not only parasites on the startup community, but to the American patent system as a whole. They try to exchange building national wealth, such as creation of new jobs and growing new companies and ecosystems, for their own personal gain.
As for AGIS, you now have my settlement terms.
To everyone who has offered their support in this case, you have my sincere thanks and appreciation. If by winning this case we cause even one company to give up their shakedown it will be worth it.
Many of you have reached out to me personally and offered your support and I’m now working with the broader industry to explore other ways to stop this behavior, so if you’d like to get involved you can join this cause at http://signup.startupsagainsttrolls.com.
Chris Hulls is the founder and CEO of Life360, an app for families and households.