Mosaid Technologies makes its living buying and selling ideas.

The company creates and licenses new technology for semiconductors and more. Mosaid also buys patents. It licenses its intellectual property to chipmakers and others.

In February, it bought a group of 300 patents from SercoNet. It also signed a pact about that time with memory maker Micron Technology (NYSE:MU - News), and gained rights to another 400 patents.

Those and other moves doubled the number of patents it holds. Today, is has nearly 1,800 patents and applications for patents.

With the new patents, the company expects revenue this fiscal year to jump 20% to $66 million. Mosaid counts NXP and Japan's Oki Semi among its chip licensees. Cell phone leader Nokia (NYSE:NOK - News) licenses some wireless IP from Mosaid.

Chief Executive John Lindgren recently spoke with IBD about plans to keep Mosaid on the growth path.

IBD: How did the acquisition of SercoNet's patents come about? Have you fully integrated the patents into your portfolio?

Lindgren: The rule of thumb is a licensing program will take 18 to 24 months on average from the time of pulling the trigger on an acquisition to when it can generate revenue. But we were able to quickly close a contract with (license patent technology to) a key player.

SercoNet was a company in Israel that was well known for power over ethernet (sending electric power and data over ethernet cable). They failed to make it. It was down to a shell company. Its only assets were 300 patents that covered a huge variety of power-over-ethernet technology.

IBD: What's the market like today for licensing patents?

Lindgren: The difference between our business and a services company or product company is the licensees we approach don't have a choice whether to sign with us. If we have valid infringed patents, this is more like asking to collect back rent than trying to sell a new service to a company. So the economy has less effect on us than on a company trying to sell new IT infrastructure to a company.

IBD: Did you adjust your strategy as a result of the recession?

Lindgren: We did. One thing we did was look at the creditworthiness of our licensees. We take credit insurance out on some companies that have contracts with us.

But our revenues are 70% booked as we go into a fiscal year. For example, the Micron deal we announced in January is a 10-year deal. We get a good visibility into our revenue stream.

At midyear, we raised our guidance. Business is going very well.

IBD: You've said you want to diversify your patent portfolio. How's that coming?

Lindgren: We've already diversified and will continue to.

Look at the global recession the last 18 months. Lots of companies were battening down the hatches. We used it as an opportunity to expand. We literally doubled the size of our patent portfolio.

We're looking to the future and for opportunities to grow. We have four licensing opportunities now. This business model -- with 40 employees -- generates $1.5 million-plus per employee. It's a very leveraged business model. We can continue to grow without adding overhead.

IBD: What are the legal aspects to patent licensing?

Lindgren: We try not to be in court a lot. But it is our biggest expense line item. We are talking to 100 companies about taking a patent license. A certain percentage of those will require litigation.

We've been fortunate. We have been in only four litigations in the company's history (it was founded in 1975). All of those settled, and for larger amounts than we asked for before we filed the suit.

IBD: In July, you sued IBM (NYSE:IBM - News), claiming it's infringing on six Mosaid patents relating to your DRAM memory chip technology.

Lindgren: It's always unfortunate when we have to resort to courts. With IBM, it just didn't work out. We talked to them for many years. The suit is in a very early stage. We haven't even had a case management meeting.

IBD: Won't it be expensive trying to fight IBM's big legal staff?

Lindgren: That's one reason we carry a healthy cash balance. We have been profitable for six years and do have significant resources (Mosaid had $52 million in cash at the end of July) to fight the battle to the conclusion.