Patent Hunters

Analyzing millions of patents granted by the USPTO between 1970 and 2020, we find a pattern where specific patents only rise to prominence after considerable time has passed. Amongst these late-blooming influential patents, we show that there are key players (patent hunters) who consistently identify and develop them. Although initially overlooked, these late-bloomer patents have significantly more influence on average than early recognized patents, and open significantly broader new markets and innovative spaces. For instance, they are associated with a 15.6% (t=29.1) increase in patenting in the late-bloomer's technology space. Patent hunters, as early detectors and adopters of these late-blooming patents, are also associated with significant positive rents. Their adoption of these overlooked patents is associated with a 22% rise in sales growth (t=6.55), a 3% increase in Tobin's Q (t=3.77), and a 4.8% increase in new product offerings (t=2.25). Interestingly, these rents associated with patent hunting on average exceed those of the original patent creators themselves. Patents hunted tend to be closer to the core technology of the hunters, more peripheral to the writers, and to be in less competitive spaces. Lastly, patent hunting appears to be a persistent firm characteristic and to have an inventor-level component as well.