Client case study Crunchfish – Proactive patent strategy with the world as market
Joachim Samuelsson, CEO and principal owner of the Nasdaq First North listed Crunchfish, talks enthusiastically about the company’s latest investment in offline payment and what lays the foundation for global success: a proactive patent strategy.
Today, when less than one in ten purchases in Sweden is made with cash, Sweden’s well-functioning IT infrastructure drives the marginalization of physical currency, which makes the Swedish payment market extremely sensitive to disruptions and downtime. Crunchfish has developed a patent-pending solution for offline payments and CEO Joachim Samuelsson explains why:
–Simplified, you can say that we have patented the technology for a robust and friction-free payment solution that works 24/7 and which also complements and can be integrated into all forms of digital payment solutions worldwide. In Sweden, we are spoiled with a good IT infrastructure and have become by far the best in the world to not pay with cash. This means a vulnerability in the event of disruptions and downtime, as fewer and fewer people carry cash with them, the only means of payment that is guaranteed to always work. In other parts of the world, such as India, cash payments still account for 80% of purchases, as digital payments cannot be trusted to always work there. Our offline solution works just like cash, but digitally. That insight drove us to invest in this invention.
Unique position through patented solutions
Today, Crunchfish’s portfolio contains both solutions that are very important commercially and others that are more peripheral.
–We have inventions from three generations of technology development, which has meant both a large and diverse patent portfolio. We have patents regarding gesture control, proximity-based interaction and most recently digital payment, which is our current focus. The fact that we have applied for a patent for the technical core behind offline payments means that we can confidently market the invention to the world’s payment services, says Joachim Samuelsson and his personal enthusiasm for patents is obvious.
– For us, it has been a conscious effort to always build a protected market position by patents. The patent process is often complex and can feel difficult to navigate. But I am triggered by what I believe in and want to protect what we develop and invest in. I am a technology pioneer myself and stand together with the company’s founder and CTO Paul Cronholm as inventor of more than half of our patents.
The interaction between inventor and patent attorney
Joachim Samuelsson joined Crunchfish in the autumn of 2012, as its first investor, and took initially on the role of working chairman of the board with responsibility for, among other things, the patent portfolio. With the company’s increased focus on mobile payments, Joachim instead became CEO at the beginning of 2020. The collaboration with Ström Gulliksson began even before Joachim’s investment in the company with a patentability study of the company’s technology and a so-called Freedom-to-Operate analysis, a relatively comprehensive evaluation to determine whether the scope of protection of other companies entailed any restrictions.
– I made it clear to the founders that I only wanted to invest in Crunchfish if they had patentable technology. I had prior good experience of Ström Gulliksson from a project where I invested in Biomain in 2008 and was its COO with, among other things, responsibility for the patent portfolio. It was an exciting journey with an exit 2012. The divestiture became a result of winning a case in the Stockholm Patent Court where we sued our competitors for patent infringement. We were represented by Rikard Roos together with Mikael Karlsson from Advokatbyrån Gulliksson During those legal proceedings, I realized that there can be a big difference between patent firms when it comes to competence. We won a clear victory and even got an immediate stop to the competition with an interim decision by the court.
– Crunchfish is a small company in terms of number of employees and financial muscle. Since we do not shy away from tackling major technical challenges that really need to be solved, I would feel much more threatened that the big tech companies would catch up with us once we have shown how to solve the problems if it were not for the fact that we have invested so heavily in patenting, says Joachim and proudly states:
– With over 25 unique inventions that have been granted patents, we have more patented inventions than employees! Our hit rate has been incredible.
An important part of the successful work with patents is the interaction between the company and the patent attorney, says Joachim:
– To work with Björn Andersson is to work with someone who possesses technical knowledge in our areas and is good at capturing our ideas. It happens that we more or less throw ideas at him. He is a genuinely curious soul who loves technology. He comes up with counter-arguments and is just as good at narrowing down ideas as he is at scaling them up. He also masters the craftsmanship required to write a good patent application that has been shown to be important in getting them all the way to approval with a wide range of protections. Then he is also damn nice and we like to go together and see Malmö FF win exciting soccer games.
Growing patent portfolio and the whole world as a market
The patent portfolio is growing continuously and the strategy is clear and aggressive: to protect the company’s technology in all geographic markets that are considered important. Crunchfish owns all of its patents and patent applications without limitation. During the third quarter of 2020, Crunchfish had 28 unique innovations that were granted patents. In total, Crunchfish had just over 90 active patents and patent applications, including all country-specific applications.
Björn Andersson, European patent attorney, agrees with Crunchfish that it takes more than good technology to succeed as a company today.
– Crunchfish is an excellent example of a Malmö-based company with the world as a potential market. They understood early on the importance and value of investing in patents. Step by step, they have strategically built up their patent portfolio, which forms the basis on which they create profitable business, at the same time as they are involved and drive development. As a customer of Ström & Gulliksson, they are an extremely exciting company to follow and collaborate with! Crunchfish has a proactive and business-driven strategy that has positioned them well for the future.
And the driving force for Crunchfish as a company? According to Joachim, it is crystal clear: the technology first, to identify patentable inventions, and then create profitable businesses through scalable products with global market potential.– I would say that we are pioneers who are based primarily on technology. We are driven by being out early and coming up with radical innovations in difficult problems that really need to be solved. Crunchfish’s founder and CTO Paul Cronholm embodies the idea that in combination with understanding how we can make the technology commercially scalable is our recipe for success.
This is Crunchfish
Since the start in 2010, Crunchfish has focused on human-machine interaction. The company’s gesture control technology from 2012 makes it possible to control smart AR glasses with hand gestures. In 2014, Crunchfish began patenting its proximity-based mobile technology, which is a groundbreaking way to discover and communicate with anything and everyone nearby.
Today, Crunchfish mainly focuses on digital payments that started to be patented in 2017. The unique offline solution makes payment services robust and friction-free because all risks of disruptions and downtime are eliminated. The solution can be integrated either in a mobile wallet or with the rails of the payment infrastructure, which creates great scalability globally.
The Crunchfish headquarter is in Malmö with operations also in India. Since 2016 the company is listed on Nasdaq First North. Crunchfish AB (publ) has two wholly owned operating subsidiaries, Crunchfish Gesture Interaction AB and Crunchfish Proximity AB. Crunchfish Proximity in turn owns Blippit AB in equal shares with ClearOn AB.