I first met Stephen Key in 2001. Two months later, I used a few recommendations of his — shared over the customary gin tonic — to help a friend double overseas sales in less than two weeks in New Zealand and Australia.
How? Licensing. It can be a beautifully elegant model.
Stephen is somewhat famous in inventing circles for two reasons. First, he consistently earns millions of dollars licensing his ideas to companies like Disney, Nestle, and Coca-Cola. Second, he is fast. It seldom takes him more than three weeks to go from idea to a signed deal.
He is not high-tech. There are no multi-year product development cycles. He specializes is creating simple products or improving upon existing products, often using nothing more than a single-sided drawing or photograph. Coupled with refined cold-calling skills, Stephen meets with some of the most influential marketing executives in the world. In this interview, we’ll explore how this advisor to American Inventor rents his ideas to Fortune 500 companies.
1- What exactly is licensing, and why is it a good option for people with ideas but little time or patience?
I think licensing is a bit of mystery to many people. It really doesn’t have to be.
Licensing is renting your idea to a manufacturer. The manufacturer handles the marketing, manufacturing, distribution and basically everything else required to bring the product to market.
Usually quarterly (four times a year), the manufacturer pays you a royalty on every unit they sell. This royalty—generally a percentage of the total wholesale price—is your payment for bringing them a new product idea that they can sell to their customers.
It’s an attractive low-risk alternative to manufacturing products and taking them to market yourself.
Using licensing, I can spend my time coming up with new product ideas instead of worrying about balance sheets, cash flow, employees and all the other hassles of running a company. I might pitch three ideas one month and no ideas for the next two months. You can have total flexibility with your work schedule.
Here’s one tip on how to make sure you get paid a certain amount four times a year.
Minimum Guarantees – So here’s why I use the term “renting” when describing licensing your idea to a manufacturer. It’s very important to make sure the manufacturer performs. You need a performance clause in the licensing contract. Without a performance clause, the manufacturer could just sit on the idea and do nothing with it. I’ve seen it happen.
Ensure you have a “Minimum Guarantee” clause in the contract. A minimum guarantee clause basically says the manufacturer needs to perform and sell a specified number of units every quarter or every year. Otherwise, you get your idea back and you can license your idea to another manufacturer.
It isn’t usually necessary to call in [enforce] the minimum guarantee clause. Most of the time you want to give the manufacturer a chance to perform. After all, you are partnering with them and they’ve spent big money on setting up their facilities to manufacture your new product.
Here’s another tip: Don’t front load the deal. I see many people with ideas doing this. They ask for large up front fees and make it to hard for the manufacturer to say yes to the deal. Instead ask only a small amount of money up front and scale up the minimum guarantees each quarter.
An example of minimum guarantees:
100,000 units quarter one
200,000 units quarter two
300,000 units quarter three
Let’s say the manufacturer sells 110,000 units quarter one. You would get paid a royalty on each of the 110,000 units sold.
Then let’s say the manufacturer only sells 190,000 units quarter two. The manufacturer can choose to pay you the royalty for the minimum 200,000 units they guaranteed you they would sell and they would retain the rights to manufacture your idea.
You should be OK with these “Minimum Guarantee” numbers since you set them up when you negotiated the contract. Set up numbers you think the manufacture can meet and that you’ll be OK with if the manufacture just meets the agreed upon “Minimum Guarantee”.
Of course you would prefer to earn royalties on 600,000 units every quarter, but you know you are guaranteed at least a certain “Minimum Guarantee” every quarter. This makes it nice when budgeting to buy that new sports car you’ve had your eye on.
2- I’ve heard you say that the most important thing you can do when licensing an idea is to spend as little time and money on the project before you get feedback from a manufacturer. Why?
Yes, that’s true. Unfortunately, it’s the exact opposite of what most people do. Most people go out and spend $3k to $20k or more on a patent and a few grand or more on a prototype first.
Time is the enemy in this process.
I’ve talked to inventors who have been contemplating or working on ideas for years. That’s not me. When I have an idea, it only takes me three days to three weeks to find out if the idea has legs.
On average, I recommend that my students take no longer than three weeks to three months before they make the decision to keep working on the project or dump the idea and move onto the next one.
Spend very little time or money on a project before you get feedback from manufacturers. The reason for this is simple: You’re not going to hit every idea out of the ballpark. Sometimes the benefits of the idea just aren’t intriguing enough. Maybe the idea has some manufacturing problems. Maybe the idea has been tried before and you didn’t find it with your research. There can be many reasons why manufacturers decide not to move forward with an idea.
You need to call a handful of potential manufacturers that might sell your idea. It takes very little time and next to no money to make the calls, and it’s the only way you’ll get the critical early-stage feedback.
File a provisional patent application ($100), create your sell sheet ($0-$80) and start making phone calls as soon as possible. That’s totally the opposite of what most people do. Most people dream or plan and research the idea to death.
The reality is that you will never be as knowledgeable about a particular industry as a manufacturer that been in the business for thirty years. They’ve seen everything imaginable in their product area. Their opinion is the only one that matters. Get your idea in front of them as soon as possible and get the feedback you need to pursue it or kill it.
Here’s a summary of my solution to the patent and prototype hang ups many people seem to have.
PATENTS:
PROBLEM (What most people do):
The majority of people I talk to think the first thing they need to do is go out and spend money to have an expensive patent filled by a patent attorney. Here’s why that’s wrong: Many times you’re going to get complaints from manufacturers that your idea needs to be fixed in one way or another. No problem. You’re creative and they aren’t. Go back to the drawing board and fix the problems the manufacturer presented.
The only problem is that if you’ve wasted $3k to $20k on a patent, now your going to need to file another patent covering the new features of your product. Another $3-20k? I don’t think so. There is a better way.
SOLUTION (My method for you):
Instead, spend $100 on a Provisional Patent Application (PPA). A PPA gives you one year to fish of the end of the pier to see if anyone is interested in your idea.
A PPA also allows you to say “patent pending.” It’s a huge benefit to the small guy! If you come up with a new version of your invention, just file another PPA with the additional features. With my approach, you should be able to get a “go” or “no go” in three weeks to three months.
Make sure to put another one to five months aside for negotiations and you’ll still have many months left on your twelve month PPA.
Then when you license your idea to a manufacturer, you’ll put in the contract that the manufacturer is responsible for paying your attorney to upgrade your PPA to a full patent and put it in your name! This is how I get multiple patents, in my name, paid for by manufacturers.
PROTOTYPES
PROBLEM (What most people do):
People think you need to have a polished and perfect prototype in order to sell an idea. I have sold many ideas with very simple prototypes and many without prototypes at all .
What people don’t understand is that you are not selling your prototype or your patent. I’ll say that again. You’re not selling your prototype or patent. You are selling the benefits of your idea.
SOLUTION (My method for you):
Create a sell sheet. What the heck is a “sell sheet”? It’s a regular 8 ½” x 11” piece of paper. It’s like an ad for your idea. It has the big benefit of your product in one sentence at the top, maybe a few sub benefits or features in bullets below and a picture or drawing of your idea. “Oh, but I have to build a prototype,” many will say. No, you don’t.
You don’t need a prototype until you get some interest. If you don’t get any interest, you haven’t wasted time on a prototype.
Your sell sheet should be like a billboard on the freeway. People should be able to glance at it for a few seconds and understand the benefit of buying your invention. They don’t need to understand every feature or hear you make clichéd statements like, “if we only sell this to 1% of all households in the country, this new idea will make millions”.
My one line benefit statement for one of my biggest ideas was, “I have a new label innovation that ads 75% more space to your container.” That’s it. I didn’t need to explain how when I called on the phone, they just wanted to know more.
Benefits, benefits. That’s what you are selling. Not your patent or prototype.
[Editor’s note: Though the following video is no longer available, you can still watch Stephen and his associates walk you through the ins and outs of licensing at https://www.youtube.com/c/inventRight/videos.]
Stephen in motion: Repurposing existing products in 5 minutes for a call sheet model or prototype…
[To be continued in Part II: negotiated royalty rates, who to call within companies, product idea criteria, what product categories to avoid, and more]
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[…] 26, 2007Taking Action Timothy Ferriss, author of 4 Hour Work Week, has an interview up with Stephen Kay, inventor. While they don't necessarily reflect the same market or […]
Awesome tips Tim. Reading this approach a big “bell” went off in my head – along with the sound of my inner voice saying “duh!” – this is so much smarter than trying to handle everything yourself. I see usefulness for this approach not just in patentable inventions but all other aspects of virtually any type of business. I am immediately changing the way I handle all of my entrepreneurial activities based on this advice.
As always, another great thought producing article .
Thanks
Thanks Tim – excellent interview.
I’ve been on Stephen Key’s mailing list since sometime, but haven’t bought his product yet. Maybe I should invest in it…
Tim,
Loved your book, which crystalized a number of things towards which I have been groping throughout my life as a micro-entrepreneur.
As a writer/publisher, I thought the best way to say “Thank you!” would be with a suggestion for a minor copyediting correction in the next printing:
The quote from Paul Theroux on page 248 should read, “It is fatal to know too much at the OUTSET . . .”
Now try to get your pubisher to fix it! ROFL.
Tim, I am not sure how you can have your hand in so many different pies at the same time , and be an expert at all of them … but this is amazing.
I have been stuck in this ‘patent-invention-marketing’ area for over 10 years. I have not found the financial resources needed to patent my ideas. Or I would find the cost of patents and patent searches too intimidating when I am not guaranteed anything for my time and expense….
But … after reading this blog today … I think I can finally move forward!! Thanks a million!!
Sorry to say that, but this kinda awakens the skeptic in me. If it’s really that easy, why is there a $400 course needed for this? And the “This is how I earned a brazillian dollars!” success stories don’t help much.
I’m not sayin that it’s snake oil, but as much business advice, it sounds a bit too repeatable, Charles Atlas-style.
Thank you for sharing! It’s wonderful to have found other people out there who show such a zest for learning and for life, and willing to share that with others. I’ve been toying with a patentable idea for a month or so now, so this is timely.
Now, it’s just a matter of making heads or tails of the provisional patent information on the UPTO site 😉
Thank you!
I bought your book “One simple Idea”. After reading it i knew I was at the point of making contact. So far I have made a few submissions but no replies. Should I keep calling until I get an answer or just simply move on.
Does it matter who licenses it or will any company be ok? I have IP for world wide coverage and a working protoype. Initial surveying shows 97% of people would buy the product. The cover letter and sell sheet are in place but no results. Any thing you can suggest will be appreciated. Thank you in advance.
Glen Hammond, (a person of interest), I am wondering if i can skip the 6 month process with Stephen key and his invent right website and just go straight into licensing. I’m only curious because i don’t have the funds saved to start his program, can you maybe help me figure out how i can start without having to purchase an entire coaching program?
Thank you very much!
No need, post on Elance and get someone to file it for you! I found an excellent patent attorney who did it fast and well for 300 USD.
how do i find these companies that rent ideas? i have a few and would liketo try a tleast one and see if this is real or a scam//ill use one that wont hurt if it fails [Moderator: phone number deleted] thanks
What are some examples of actual things Stephen has done/does? Examples of what he’s taken to specific manufacturers and licensed to them that we’d know about?
This sounds great and all, but I’m just not wrapping my head around coming up with a billion “ideas”, and turning around every few weeks and selling those “ideas” to somebody. Anyone can come up with hairbrained ideas….what makes this case so special?
Pardon my skepticism 🙂
Tim,
This is another great post. Super helpful.
I have been playing with a couple ideas for licensing and patents for a few years, but have not had the money to file them and risk the time and money to build a prototype and this post was like a huge weight lifted off my shoulders.
Awesome.
I have the ability to move forward and see what happens now without much risk. Thanks!
B
Tim, I appreciate you presenting this topic…
I am working in the field of character licensing with both new and niche market properties that definitely are not (yet) household names like Dora or SpongeBob.
This may be out of Stephen’s expertise, but can he speak to how his strategies might be modified to benefit artistic Intellectual Property? It seems that the pitch to manufacturers in character licensing is much more about “riding an already established wave” than taking a risk on an “unproven” market presence.
Does this mean that the Goliaths of the industry (Disney, Nickelodeon, etc.) will always have the advantage of sheer cash to throw around and impress potential partners? Or are there guerilla, “new rich” techniques that you and/or Stephen can suggest?
Thanks again for the covering licensing. I like forward to the rest of the series.
Tim, good suggestion about the provisional patent. From what my inventor friends tell me that’s the way to go. Not only protects your idea, but also makes companies more willing to deal with you because in a way it protects them too. You can of course only patent ideas for things that are functional, as opposed to aesthetic. For images and words you would get a copyright.
Hi Tim, I loved your book! Keep up the insightful work. I’ve never heard of this approach with patents and have been at a road block myself because of the filing costs.
Thanks Much, Melin
Tim,
Great post but two points:
1) While intrigued, I, too, am a bit skeptic. This seems too easy.
2) I think your readers (well, at least me) would love some information on selling one’s ideas to a company and how to avoid getting ripped-off.
That is, XYZ company sees your nifty invention, likes it. Creates something similar that it can patent and then runs with it, leaving you in dust and uncompensated for your hard work and inspiration.
I to would like to safeguard myself from the XYZ company who sees it’s a great idea and makes minor changes and leaves me with no recourse.
You can cover this by having a good patent application. Read the wording, ask an industry expert to read it, get an alternative patent lawyer to critisize it etc, amend. This is a question of validity/scope of meaning and quality control.
I feel like that is the point of patenting the entire idea of the product.
Pete wrote. . .
“What are some examples of actual things Stephen has done/does? Examples of what he’s taken to specific manufacturers and licensed to them that we’d know about?
This sounds great and all, but I’m just not wrapping my head around coming up with a billion “ideas”, and turning around every few weeks and selling those “ideas” to somebody. Anyone can come up with hairbrained ideas….what makes this case so special?
Pardon my skepticism :-)”
Hello Pete,
You can view many of the products I’ve licensed by visiting my website and viewing the projects on the right side of my home page.
Your right about coming up with ideas. It’s much easier to come up with ideas than to sell them.
I teach some techniques for coming up with ideas, but knowing how to sell those ideas is the part most people don’t understand and the part of the process that I really emphasize.
Knowing how to sell a new product is absolutely critical.If you don’t pick up the phone and call some manufacturers, the idea will just be in your head and it won’t go anywhere.
I’m doing a free tele-seminar (phone seminar) this Wednesday. It’s totally free and there will be no big sales pitch for my course.
It’s my way of helping out people who are new to the game.
You can sign up for the tele-seminar for free, just go to the news page on my website.
I wish you much success in all your invention related endeavors.
Stephen Key
Stacia wrote. . .
“Thank you for sharing! It’s wonderful to have found other people out there who show such a zest for learning and for life, and willing to share that with others. I’ve been toying with a patentable idea for a month or so now, so this is timely.
Now, it’s just a matter of making heads or tails of the provisional patent information on the UPTO site 😉
Thank you!”
Hello Stacia,
I love your positive attitude! Here are a few words of advice.
The patent office web site is great for doing patent searches, but won’t show you step by step how to file a provisional patent.
The book “Patent Pending In 24 Hours” on my web sites resource page will show you step by step in common English how to file a provisional patent application. It’s a great book. I have no self interest in promoting the book. You can buy it at any book store.
What the book won’t tell you is how to sell your ideas. 97% of all patents never make any more money for the inventor than the inventor spent on the patent.
This is because most people thing the first ting to do is file a patent. It’s most definitley not!
My advice is to do some solid research of the marketplace before you even spend the time to file a provisional patent. Patents don’t sell themselves.
I wish you much success with your projects.
Stephen Key
This IS the SOLUTION for us “IDEA GUYS”!
Awesome post Tim, thanks! I invented a residential illuminated address sign back in ’91. It was by far the best design on the market and could be manufactured at a great price. Because I was a perfectionist, I did the manufacturing and marketing all myself. Although I had started selling and earning a living only 2 years after concept, I wasn’t satisfied and wanted to take the product and marketing from 80% quality to 99%. That took 5 more years.
I ENDED UP BURNT-OUT AND BROKE so I sold the company. Some successful (Porsche & Ferrari driving) young entrepreneurs bought it for a royalty (with no minimums) then shelved the idea. Over the 2 following years they lead me on, I went bankrupt and split with my wife and two year old. Turns out the “young entrepreneurs” were actually lawyers! They finally sold the company for $100 and gave me my one-sixth share. That was 9 years of my life, over $100k in manufacturing equipment and patents for $16.66.
I HATE LAWYERS. I rented some trucks and thugs and went to the new company who bought my biz and reclaimed all my equipment. Then I visited my contact from the young lawyers. Actually I followed him to work and when he was stopped at an intersection, I took my tire iron, went over to his car, and SMASHED IN HIS DRIVER’S SIDE WINDOW, then dragged him out through it and expressed my feelings. I was very lucky to find a judge who was quite empathetic.
WHEN I GOT OUT OF JAIL, I was truly renewed. I started another business right away, this time bootstrapping it and test marketing it before investing any money. In just 6 months it was worth over $2 MILLION and I paid off my investors from the first biz.
Since then I’ve created an entrepreneur education program that teaches how to start any business from nothing using an initial promotion which not only test markets the concept, but if it’s successful, it can entirely finance your venture.
~Victory Darwin
p.s. I’m really looking forward to part 2 of the Steven Key story. Everything he says about the PPA and sell-sheet instead of prototype is right on and yet hardly anybody knows it. Dan Kennedy taught me the DIY method to starting a biz, which is to create a promo, send it out, and get orders. If you say “allow 4-6 weeks for delivery” you then have that window to get producing the product.
video isn’t working. “we’re sorry this video is no longer available”.
p.s. did you do the PR teleseminar yet? (the $125 one)
Licensing sounds like the ultimate form of outsourcing for idea guys like me. I was about to part with $399 for his program and I noticed his checkout has a coupon code!
so Mr. Ferriss can you give your bud Stephen Key a call and get us loyal 4hww readers a FERRISS50 ?
thanks!
V.
Right on.!
Implementing this strategy is going to be a lot tougher than he makes it sound. Inventors are likely to get taken to the cleaners by the big companies.
Any reasoning?
Hi there I just sent off my patent two days ago. it’s for a design patent. I don’t know if I should start, reading info on licensing, or should I wait to see if, the patent is approved?
Tim and Stephen,
Wonderful post.
Can you also please include in Part II manufacturer criteria? For instance, I am wondering if a contract manufacturer would automatically be eliminated as a prospect. This might be an obvious question – I just don’t know much about the world of manufacturing yet.
Thanks! Looking forward to the follow-up post and teleseminar Wednesday.
I will keep this short. This post is for everyone. There is not just one given way to make money and not all ways work for everyone. I think the level of excitement about a notion has a lot to do with the outcome. If you do something just to make money, the fire will burn out soon. These are principals that can be used to help increase your chances of something working out. There are NO guarantees, the only guarantee you have will be that if you don’t try something then it will Definitely not work. One should always consider the cost opportunity of doing one thing rather than another. All in all trying these methods seem harmless and who knows they may just make you a buck in the process.
Nice Post & Enjoy your Journey
Jose Castro Frenzel
# Varangy Wrote. . .
November 26th, 2007 at 2:03 pm
Tim,
Great post but two points:
1) While intrigued, I, too, am a bit skeptic. This seems too easy.
2) I think your readers (well, at least me) would love some information on selling one’s ideas to a company and how to avoid getting ripped-off.
That is, XYZ company sees your nifty invention, likes it. Creates something similar that it can patent and then runs with it, leaving you in dust and uncompensated for your hard work and inspiration.
REPLY
Hello Varangy,
RE: Being Skeptical
Great post! Being skeptical is good. Your right, it’s not a piece of cake and it DOES require work to close a deal.
Going through the steps the way I do is not hard in my opinion and the opinion of many of my students. Does that mean that you will close a deal every time. Of course not.
Licensing is a numbers game. I could wallpaper my house with rejection letters. You need to be willing to fail in order to succeed. Here’s one of the big differences with how I approach selling ideas . . .
I teach people how to play the licensing game affordably. So when you fail, you can easily move onto the next product idea. Using the methods I’ve developed, my students can often invest less than $300 in a provisional patent, sell sheet and the cost of their phone calls to pitch each of the their products. This is a much better way in my opinion than what the average Joe on the street with an idea does, which is run out and spend 10K on patent and 5k on a prototype and then hopes someone will beat a path to their door to buy their widget.
My inventRight approach is all about minimizing both you financial and time investment in each new product idea you come up with. It’s not right for everyone. I’m just sharing what I’ve learned over my 25 years of selling new product ideas.
RE: Getting Ripped Off
I’ve pitched hundreds of ideas over the years and only been ripped off a few times. Big companies don’t want the liability of ripping off the little guy. It does happen, but it’s rare. For $135 you can file a Provisional Patent Application and say patent pending for a year. How cool is that!
Kindest Regards,
Stephen Key
inventRight
# Fredrick Wrote. . .
November 26th, 2007 at 1:01 pm
Tim, I appreciate you presenting this topic…
I am working in the field of character licensing with both new and niche market properties that definitely are not (yet) household names like Dora or SpongeBob.
This may be out of Stephen’s expertise, but can he speak to how his strategies might be modified to benefit artistic Intellectual Property? It seems that the pitch to manufacturers in character licensing is much more about “riding an already established wave” than taking a risk on an “unproven” market presence.
Does this mean that the Goliaths of the industry (Disney, Nickelodeon, etc.) will always have the advantage of sheer cash to throw around and impress potential partners? Or are there guerilla, “new rich” techniques that you and/or Stephen can suggest?
Thanks again for the covering licensing. I like forward to the rest of the series.
REPLY
Hello Fredrick,
Great post!
I love riding that wave and piggybacking on another products success. My Spin Label invention has sold 100’s of millions of units by being used on vitamin products, liquor products, spices, toys and various other round containers. Use the big guys and ride their wave. It’s a positive, not a negative.
Kindest Regards,
Stephen Key
inventRight
# Billionaire Strategies Wrote. . .
November 26th, 2007 at 3:49 pm
Implementing this strategy is going to be a lot tougher than he makes it sound. Inventors are likely to get taken to the cleaners by the big companies.
REPLY
Hello,
I’ve only been ripped off a few times and I’ve submitted hundreds of new product ideas to some of the largest corporations in the world. Big companies don’t want the liability of ripping off the little guy.
Here’s a tip…
If you create a paper trail, you will reduce your risk in those rare case that a big corporation does decide to rip you off.
Big companies are very slow to move. Little guys like myself are much more agile and creative.
I believe the little guy with an idea has the upper hand in many respects. If you use the right approach and correct techniques, little guys like myself and you can license products to some of the largest corporations in the world.
I’ve done deals with Disney, Ohio Art, Nestle, and many others. I have licensed over 20 products in many diverse industries and I believe anyone can do the same.
It’s work. You have to want it and go after it.
I wish you much success in all your new product related endeavors.
Kindest Regards,
Stephen Key
inventRight.com
Wonder how well protected my idea is if I go this way? I have a recipe that sells, and I am worried about a manufacturer knocking me off if I approach them. They could vary the recipe slightly etc.
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Tim, right on, been wondering about licensing for a while. Especially w/my gym and the methods we use.
Were you planning on licensing that gym you opened in Taiwan?
Is my “idea” even licensable? Or must it be a physical product?
Thanks bruddah, hope all is well,
–Zach–
###
Hi Zach,
The gym chain in Taiwan, which was over before it started, was not a licensing deal. I was looking at either purchasing facilities or constructing them. Ill-fated on many levels!
Whether your idea is licensable or not is a better question for an intellectual property attorney or the US Patent and Trademark Office. If it can be patented, trademarked, or copyrighted, it can be licensed.
Good luck,
Tim
How do international patents work? It appears you don’t have to be a US citizen to get a “patent pending” in the US… but can’t someone in another country still rip off the idea?
Question for both TIm and Stephen, what do you both collectively suggest as a good starting point in doing these ideas/strategies.? Furthermore, Tim have you done this before and if so what products specifically have you had patented?
Stephen, what is the best way for one to do this if they currently are running their own company and wish not to risk it all. I am looking to see if there is something feasible that one can do while still traveling and enjoying mini retirements.
Look forward to hearing from you both…
Best
Jose Castro Frenzel
Interesting. I’m looking forward to part 2.
Jose Castro Wrote. .
Question for both TIm and Stephen, what do you both collectively suggest as a good starting point in doing these ideas/strategies.? Furthermore, Tim have you done this before and if so what products specifically have you had patented?
Stephen, what is the best way for one to do this if they currently are running their own company and wish not to risk it all. I am looking to see if there is something feasible that one can do while still traveling and enjoying mini retirements.
Look forward to hearing from you both…
Best
Jose Castro Frenzel
REPLY FROM STEPHEN KEY
Hello Jose,
RE: Starting Point
I suggest you go down to the marketplace and study the category your idea is in. If you have a new hammer that hits nails straight every time, then you need to go down to the hardware store and look at all the hammers and all the products around the hammers. Look at the prices, the benefits of each hammer, what they are made out of and who makes each one. That’s the best place to start.
RE:Licensing while running your business
You can without a doubt license a product in your spare time. I suggest you allot a few hours every week to working on your new product ideas. You can quite often work on each project for under $200, so money shouldn’t be a factor. You just need to set aside a litte time each week.
Hope this helps.
Kindest Regards,
Stephen Key
inventRight.com
I just came up with a product that Im working on inventing. I was thinking very hard about getting a lawyer to do the patenting for me. After I read all this posts I am now thinking to do it my self. Is there any thing to keep in mind when filling a PPA ? Is it simple or complicated? Is there anything that I need to know to make it more simple? Thank you, Costel
[…] And more about making money – A Beginner’s Guide: How To Rent Your Ideas to Fortune 500 Companies […]
I so enjoy watching geniuses at work…you, Tim, for always giving us ideas to “chew” on and you Stephen, for showing us some easy ways to get things done!
I’m not an inventor, and may never be one…but learning how to KISS is always a valuable way to approach any project/product.
Kudos!!!!
I like what you are doing. I invent for a hobby, but no success yet. Sometimes it’s hard to know where to begin when an idea comes to you. I have been doing research about inventing for about two years now, and I’m getting some what close to my goal. Just two days ago I met with a mechanical engineer professor and showed him a theory I had from three years back to clarify some things, and he told me my idea was good, but my theory was already in use in some of today’s hybrid cars (I was a few years behind). Pretty good for a novice without an engineering background, but I should think fifteen years ahead of time, and maybe even further.
I like what you’re doing. You covered the major things involved in licensing your ideas.
Later!!!
Jayson Zamora
[…] Renting ideas to Fortune 500 companies Really interesting post from Tim Ferriss about how you can license your ideas to large companies and collect royalties. Beats working, but you have to actually go out and think of useful stuff. […]
thanks for the stephen key articles. my boyfriend has had an idea for a product for a long time and had not pursued it, (for various reasons) but after reading all the information, we are ready to file the patent pending and get this show on the road. If we hadnt received this, I am sure he would not have been as inspired to run with it.
Will keep you posted how it turns out.
Thanks again.
Hi,
Wondering if a provisional patent can be filed in Canada?
[…] for those of you that don’t want to wait to start researching, read this fascinating interview that Tim Ferris (author of the Four Hour Work Week) did with invention guru Stephen Key and pay […]
In response to Matt. Why would you want to file a provisional in Canada?
– Ben
In response to Ben
Do we not need one in Canada? I don’t know the rules with this kind of stuff.
[…] compilation of news of the future. Kind of like Ziitrend, but more news than prediction. How to Rent your Ideas – Designers or Inventors read this before you get a prototype made. This could get you going. 10 […]
Some really great stuff here, so useful, thanks.
I firmly believe in “idea abundance” with regard to sharing one’s ideas with the big guys.
My reasoning is that the one idea you have isn’t going to be the only idea you have – there’re plenty more waiting in the pipeline in your head, and if you resist letting that idea into the ‘wild’, you’re clogging up the flow of other, possibly more compelling concepts.
The more free-flowing the idea stream is, the more opportunities there are for those new ideas to build on and connect with previous ideas.
Of course, one still needs to be sensible about looking after your IP rights, but not to be paralysed into inaction through fear of theft. If your idea does get stolen, well, get the next one out. You’ve lost nothing except potential opportunity, but gained experience for the NEXT idea.
Stephen,
Thank you for your reply. That’s excellent advice on protecting yourself.
Do we need to file a provisional in Canada? or is there something else we can do to protect the idea while we pitch to the manufacturer?
Wow, I could have used this stuff about 30 or more years ago!! I have been an aspiring inventor all my life and yet have nothing to show for it:-? The good news is this stuff is very valuable to me and I will study and want to know more about it. I have seen multiple incidents of MY ideas show up on the market YEARS after my conception of them. I have the ideas, but the biggest problem is taking the idea to market before the next one overtakes me with excitement, pushing the current one out of my central focus.
I am currently in Japan and plan to stay here, do you know of any relevant or different legal issues here, the Japanese equivalent to “patent pending”? I don’t have the time to read this right now but I had to comment. This information is or could be my holy grail, I have been inventing since EARLY childhood, but the legal stuff, money, inability to build a prototype and the next idea crowding out the current one have stopped me commercializing a single one. I dare not read it all now or I will be up all night excited and be exhausted and under slept for work tomorrow.
bfn Tim
Hello PJ,
Glad to hear bells are going off in your head. There is no greater compliment as far as I’m concerned.
If you want more info on licensing and thinking different. Check out our free tele-seminars we offer. It’s great info and we only spend about one minute out of 60 pitching our course. The rest is just straight forward advice on licensing and thinking different.
Kindest Regards, – Stephen Key http://www.inventright.com/news.html
Hi Tim,
The following is based on your advice, which strangely and happily is something i have been doing, yet not widely enough for a long time. As the saying goes there is more than one way to skin a cat, here’s my way, and why.
A) Since I am making the rules for this little piece of reality, here they are, Tim ( or the person you outsource this to…) I have ideas and time but a lack of money.
B) I KNOW I have knowledge and ideas that would be of sufficient value to you to make this a worth while investment of your time, and a meager amount of your money.
C) I have been an inventor for about 35 years plus despite being 40 now, so I have a lifetime of ideas MANY with commercial value and some that where commercialized years after my first conception of them.
D) I want you to buy and send me the inventright product in exchange for one of two things
one… a percentage of the first product license I land
or two…access to me and my ideas thoughts and reflections.
Sound arrogant? perhaps, but only you or your agent can decide whether this is rambling or a valuable offer, so it’s worth you saying YES (about 1/2 second of your time to have someone else find out that it IS a worth while half second or your time. Your ROI on this will ultimately be ridiculous.
In simple terms I make JUST enough money to meet living expenses, plus a small bit left over. At my current savings capacity it will take me at least two or three months to save the money necessary to get this course, unless someone with insight and a mind for profitable investments is willing to expedite this process for me.
I opted for this so that I could pursue my entrepreneurial endeavors which include jewelry design, environmental energy products.
This is the tip of my iceberg, that I have not been able to realized based on my limiting beliefs said I had to have serious cash to license a product without the manufacturer stealing it.
The truth is this offer is open to anyone who is willing to act on it immediately!
I am currently in Japan so unless you are resident here meeting face to face is a challenge, but this is an age of technology and I have internet. Contracts can be made over distance. I have a wealth of ideas, not one or two but many. If anyone wants to help you and I turn some of them into serious cash.
I need only someone with the confidence and cash to act and enough knowledge to recognize that my ideas are of value.
Someone’s future successful business partner Tim B. Green
I have a noteable name in the uk tv market. Thinking of launching my own jewellery range under my own name (my public name). Instead of taking up the manufacturing costs myself, I could license my name right or license the the name of my designs? Come up with the designs and offer it out as a licence? How do I find out what I should be charging per unit etc.. without asking around too close to home and the powers that be work out that i’m new to this licensing idea? Also can I offer the license of my own name/designs to more than one company?
Great website by the way.
[…] The Top 5 Reasons to Be a Jack of All Trades How to Learn (But Not Master) Any Language in 1 Hour A Beginner’s Guide: How to Rent Your Ideas to Fortune 500 Companies Lack of Seriousness – The Last Interview with Vonnegut The Magic of Groundhog […]
Thanks, Tim! This is just what I needed to hear….it ‘clicked’. ‘Preciate all the advice, and the links to InventRight. Peace.
Hello Danny,
I’m glad you liked the inventRight info I shared with you in this blog post. I wish you much success in all your invention related endeavors. Kindest Regards, Stephen Key inventRight
Hello. I love this website and the four hour work week book. I have a question for anyone who knows about property law. My Q is I am in the process of getting a PPA for my product, but an attorney that I talked to said it is most likely trademark-able not patent-able cause it is to obvious. I am taking Stephen Keys advice and getting a PPA and licensing my product, but can I get a PPA for my product if it is not patent-able but trademark-able? And if I make a deal with a licensee could they upgrade the PPA to a trademark? Thanks Cainen.
Hello,
I have a question for anyone who knows about property law. My Q is I was in the process of seeing if my product was patent-able or trademark-able, but an attorney that I talked to said my product is most likely trademark-able not patent-able cause it is to obvious. He advised me to get a Provisional patent and to see if it has a market. I have decided to license my product to a licensee but can I get a PPA for my product if it is only trademark-able? Can i just have (Patent pending) if i am not sure how it can be protected? Again i don’t know if it can be patented but it can be trademarked. And if I make a licensing deal with a licensee could they upgrade the PPA to a trademark after the PPA expires? Please let me know ASAP Thanks Cainen
Cainen,
A PPA and a trademark are two totally different things.
Provisional Patent Application
http://en.wikipedia.org/wiki/Provisional_patent_application
Trademark
http://en.wikipedia.org/wiki/Trademark
I wish you much success in all your invention related endeavors.
Kindest Regards,
Stephen Key
inventRight
Hello Time ..
I am over the moon with your words of wisdom. I have been coming up with simple small ideas for the last 10 years .. Most I gave away!
I ran away from home so have no skills in the education system. My education has been my enthusiasm to just know as much as I can.
I have a few ideas and have scribbled them up as you write here .. Howeverrrrah .. In sharing my ideas to a person .. he has had the bug of patenting and prototypes as you explain alot of people fall into .. I write music for fun .. I write poems for fun .. I keep coming up with ideas TOO.
Now I want to afford to get my TEETH done 🙂
Nobody has believed in me as yet that I can do anything as far as business goes. I’ve been saying for the last 2 yrs that there is no need to get greedy and over detailed get as much as you can .. just get it out there ..
I have one simple idea I am sitting right NOW .. and the person I told ‘similar to what you say here; is against the way I think .. You have FULLY re-enforced me.
I am going to get a Provisional Patent application .. and sell my idea to ‘Nestle!!’ and pitch the idea that it goes out on the market as a bonus to one of their ‘baby food products’
It’s a product that would be out there year in year out every year .. (patent design of course) ..
I would like to send it to you after I have got the patent pending year of service protection for myself 🙂 for you as ‘MY NEW MENTOR!!’
to look at and give me best guidance and whatever happens ..
I have learnt through my life of disfunctional abuse since small that if You don’t put your hand out and reach for heights you don’t get help .
so here you go. You haven’t made my day .. you have made my way of thinking worth fighting for.
Thank you …
Bee
Sorry .. It’s me again . Bee
I just have to say to you too Steven that you really know your stuff too .. and even though I get the feel that you and Tim are cool .. I get the feeling that you both have what I call the “real” class … not show pony class projection … meaning curtousy in life to everyone and now that I think of it .. I have this great chocolate idea I could sell the Cadbury TOO .. and it’s easy to get the picture across and they will LOVE it .. I didn’t think it was a good idea .. or dare I say .. I didn’t have enough confidence in myself .. You two have sparked TAHT one back up in em .. and no it ISN’T out there and all the kids will LOVE it and even I will eat it. I have a name for it too . and it’s still funny to me .. and save all the waste .. want not want not .. I wish I could blurt it out to you -:)
thanks and now I have to save to join the course and get the heavy help I will need as I will need it .. …
Bee
This reply is for BEE. You have touched my heart. I am 80 years old. I was an abused child. I am a decorated Marine from the Korean war and I was still afraid of people. I still talk like a 15 year old. I had about 50 invention ideas at one time. Several were stolen. I am not afraid of people today but I do fear communicating with large company bosses.Just Like Stephan talks about in his wonderful book… one of the greatest obstickles with us simple people. But, let me tell you… the books theory WORKS. I decided to start all over at my age . i even write scr5eenplays that have to be edited. I sent almost 400 emails out to producers. I recieved about 9 replys. One was …. judging by your grammer and punctuations, it,s a no. I tried hiring a invention marketing company for one of my inventions. They liked it but said no. I went to 2 hardwear chains and looked at products like mine. Looked up the name to one on the computer. Sent an email. the following morning 6:30 AM , I got a call from the product manager. They too bounced it. So I followed the advice from the book. I called another very big company and got to speak to the product manager. He asked to see the drawings of my product. I did get a provisional patent on it . Most of the big companies I want to use want me to have a patent. I hope I can license without one. SOoooo BEE,keep on going…. nothing ventured…. nothing gained.
Best wishes and GOD BLESS… Bobby G
Dear Stephen,
I think all this information is great for a product idea, but what about a concept. I have developed a concept that I would like to pitch to a large company but I am unsure how to go about this, and how to protect my idea. Please let me know if you can offer any advise on this topic.
Thank you,
Adrienne
[…] patents from outsides. I don’t want to sound to negative. If you want to pursue your idea further: A Beginner’s Guide: How to Rent Your Ideas to Fortune 500 Companies (Plus: Video) – The Blog o… is probably something that you should read. __________________ I am always open for feedback on my […]
Thank you for the excellent advice…it answered so many of my questions. So far, I am only out $750 in attorney fees for the cost of the Preliminary Patent Search. I was about to gulp and send the $10,000 check to move forward on the Patent. THANK GOODNESS I checked back at your site. This approach makes so much more sense.
[…] My goals lately are to get a patent on my invention. Since my last post I’ve spoken with the davison (davison.com) member over the phone and we discussed all the forms they send about everything they do to get your idea patented. It costs them between 8k – 16k to create your idea and present it to companies. Unfortunatly I don’t have that. Has anyone here backed a inventor? I was asking the davidson member and he said most inventors have a financial backer. I have a great Idea and if someone would be willing to speak with me and give opinions and possibly back me we could do a deal if the invention was purchased. Unfortunatly most patents dont ever get purchased by a company and it could be 16k down the tubes. Its alot of risk but could turn out a good profit and if not it doesn’t hurt to just talk about it and give opinions. Thanks! -Jae Kim aim and yahoo sn: preiudeh22a skype: unisom82379 You posted this on Sept. 6 and I am wondering how far have you gone with this ? I also contacted with Davison who makes your Dream come true.. But after getting the documents I researched and found that they have fatty law suit. They are sued for something like $16mil because they have done much scams with new inventors. It starts with the $495 payment. This payment is for the research. Research of what ? The existing patent what you can do by yourself on google.com/patents . Next payment is about $8000 where they will do product sample. After that for $8000 they will contact with manufacturers and try to close a deal. All this will take 2 years for you maybe more. All the money they have earned (and thats alot) is not through other peoples inventions on the market but through those payments. Most of the ideas won’t even reach to the manufacturer and people and scammed with more than $8000. Everything what Davison does can be done simply by you. Start with simpler ideas so you can do product sample by yourself. And if you think patent will cost you for $10k-$20k then you are wrong. You can aquire your patent for $100-$300 depends what the cost is at the moment and this patent is active for 1 year. So, you have 1 year to contact with the manufacturers and close the deal. Patent is called "Provisional Patent Application" The best tutorial from getting your idea to manufacturer is definitely on Tim Ferriss’ blog. Link: A Beginner?s Guide: How to Rent Your Ideas to Fortune 500 Companies (Plus: Video) – The Blog of Auth… […]
Hi,
Very interesting idea. I’ve been looking for Australian specific info and cant seem to find any. I have been looking in marketing law books (right place?). Could anybody point me in the right direction? Tim you said you helped a friend use this in Aust and NZ, do you know where i can learn more?
Thanks in advance for any help i would very much appreciate it.
Tom
I’ve found the below article helpful.
http://www.tenonline.org/art/0402.html
Jake, thank you for the link, but this is bad and old advice. Today’s world has changed. Even the large companies are adopting open innovation. Kraft, P&G and many other large companies are actively looking for new ideas. This is the old way and it does not work.
Stephen Key
I have been reading articles and books on what to do with your idea after protecting it with ppa and nothing comes close to explaining a faster, exciting, or profitable way as you do. I must have been looking for information in the wrong places. Thank you for answering a lot of my questions in an easy way to understand. Keep up your awsome work!
Thank’s for the kind words Mark. I do my best to teach what I have learned over the years. -Stephen Key
Hi Stephen, Thank you for the excellent advices. I have a question for you, I have an invention for which I already sent the PPA to the USPTO, now is the time to look for manufacturers; the main manufacturer of this line of products in the world is not based in US but in UK even though their products are widely sold in US and Canada as well; what would be the disadvantadges I will have in choosing this manufacturer vs other, smaller companies, based in North America?
This is great information for new product inventions, but what if you have an idea which is not patentable, such as an advertising campaign or retail business?
same question as “spamncheese” July 14th,2009 6:57pm. How to sell an idea which is not patentable, such as an advertising campaign or retail business? I also have one for a fortune 500 company.
Always remember you are selling benefits. Some industries require some type of intellectual property protection such as patents, trademarks and copyrights. I have found in 30 years of selling ideas that most of my ideas had no protection what so ever. Sometimes just having trade secrets in some industries is enough. Some industries because they are fashion industries just want to be first to market so they don’t care if you have any protection what so ever. In some industries having just a trademark or copyright is enough. If you have an advertising concept, is there anything that could be copyrighted? It’s a very affordable form of protection for $45. It’s not the best protection but it’s not bad. You could possibly even trademark the name of your concept. Walking into an ad agency and pitching an idea without some type of IP could be difficult. I would call a local advertising agency and represent yourself as a copyrighter/creative genius. Ask them if they take outside submissions.
If you would like more information you can always visit my website inventrightdotcom I am always giving free lectures, have a weekly radio show and a weekly newsletter.
We are also developing a new program. Thousands of companies are looking for new ideas through open innovation. Because most creative people/industrial designers and such do not have the skills to bring their ideas to market we are teaching classes on how to become a licensing expert/product scout so that people that have business skills can find these great ideas and bring these two groups together and benefit from it. I taught this class in Australia and it was very well received. You can learn more at Stephenkeydotcom If you have any other questions please let me know.
[…] in the business of funding entrepreneurs. The ideas are secondary, easy to find, not so important. Tim Ferriss is also worth reading on the subject. […]
I think that this was very interview was good. But I don’t know about the rest of you, but all anyone in the business seems to give is vague information. I never see list of companies that are willing to even listen to your idea. It’s like you only get enough of information to “tie” you over, but if you think about you never get any information that you can say o.k. now let me try these guys. Maybe it’s just me but it’s like they say “Yeah it was a long hard journey to get to the water, but I finally got there. But your still left wondering how did they get to the water? How did they travel? By train,plane or automobile?
Interesting information! I have an idea for a new APPLICATION of a small publicly-traded company’s product. I would use this company’s patented product and repackage it for the use I have for the product, which would expand this company’s product line. How could I learn if this company has ever considered my new application idea (without asking them)? Would I be advised to license this NEW APPLICATION of the company’s existing product line? I just want to be compensated for my idea. Thank you.
If I am not selling my prototype or patent, then why do you suggest getting a PPA?
Hello Suri,
A PPA (Provisional Patent Application) is only $110, you can file it yourself.
The PPA is a great tool. It gives you Patent Pending status for one year while you shop your idea around to see if anyone manufacturers are interested.
You are right though……..
You are not selling your patent or prototype. You are selling the benefits of your idea.
For Example:
Your “hammer that hits nails straight every time”
OR
Your “Kitty litter that doesn’t stick to your cat’s paws”
The PPA protects your idea while you sell the benefits.
Hello Suri,
A PPA (Provisional Patent Application) is only $110, you can file it yourself and it let’s you say Patent Pending.
The PPA is a great tool. It gives you Patent Pending status for one year while you shop your idea around to see if anyone manufacturers are interested.
You are right though……..
You are not selling your patent or prototype. You are selling the benefits of your idea. For Example: Your hammer that hits nails straight every time or your “Kitty litter that doesn’t stick to your cat’s paws”
The PPA protects your idea while you sell the benefits.
Hello “I need the important info” from a couple posts up,
I give away lot’s of detailed free info on my blog and via my web based radio show. Click on my name to visit my site in this post to visit my site and get the details you are seeking.
Randy,
I would approach the company with a sell sheet and pitch it to them.
Coming up with one idea for one company is not ideal, so i wouldn’t spend to much time on it because they may not be interested.
A better senario would be if you had six or seven potential licensees. One potential licensee reduces your chances of success. If you are going to take the time to create a presentation, you would be better off pitching an idea to multiple companies.
I just recently submitted a patent application and have patent pending status on an iphone accessory and am part of Oregon’s MIPOS Innovate 20 Program (which you will speak at in June). I want to learn about every steps in the process but am willing to pitch my idea to try to get it licensed asap. The top companies (Griffen & Belkin) I am looking at refuse to sign a non-disclosure form and take no responsibility for their actions once I send prototype to them. Should I be concerned with them taking my invention, tweaking it just enough, and throwing me away? I would like to think I can trust someone but… I greatly look forward to meeting you in June. Thank you
Roddy,
You are in for a hard road if you insist everyone sign your NDA ( Non-Disclosure Agreement)
I can only tell you what I do and don’t do. I focus on selling the benefits of my idea, not putting up a big legal brick wall or hurdle when i show my ideas.
Whatever protection i have (Inventors Notebook, Provisional Patent Application) is what i have and whatever they have is what they have. I almost never ask companies to sign NDA’s. There are exceptions, but I don’t have time to go into those here.
Why would a company sign your NDA when they don’t even know what you are going to show them? It’s like saying…. “you need to keep this secret and not tell anyone, but i won’t tell you till you sign this NDA binding yourself”.
What if it turns out they are working on something similar? Your PPA is your protection?
This is not legal advice and just the way I do things. I am not advising you to do the same. How you handle this is up to you. If you need legal advice, please seek the services of an attorney.
What are the regulations with an NDA?
This is what I have always thought. I have come up with two world changing ideas and I just cant do anything with them. EVERYONE i have ever talked to wants these products yesterday but i just dont know how to turn them into $$$. The first idea, i maxed out my credit cards, lost my job and borrowed money off my mother to get a PPA (i paid a patent attorney $3K for this how ripped off was i?) and built a prototype. still i could even get to talk to anyone. grrrrr. anyway now im too busy with my PhD and my rock band to folow up these billion dolar ideas. grrr again. look forward to hearing about who and how to contact the right person. i appreciate your point of view tim, so onto it.
Craig
Hello Pitching Manual,
I’m not sure what you mean by “Legal Regulations”.
I recommend having an attorney provide you with the proper NDA (Non-Disclosure Agreement) for your particular situation.
Hello Pitching Manual,
I’m not sure what you mean by “regulations”.
I recommend having an attorney provide you with the proper NDA (non-disclosure agreement) for your particular situation.
Hello Craig,
I understand your frustration. The solution is to not spend $3k with a patent attorney. I file my own Provisional Patents for $110, then make a list of companies that are a right match for my idea and call them.
Feel free to contact me through my website. You can click on my name in this post to visit my website. Email me through the site and I’ll help you out.
-Stephen
Hello Stephen;
I love your book. I am an 80 year old with many invention ideas. I did hire a company that promotes inventions. The worst was the Morrison agency. But I thought this company was suppose to be better. They bounced my invention but said it was a good idea. So, On a Saturday I contacted a company I found from Inventright. I really wanted some feedback. but this company back East called me at 6AM wanting to see it. Now, I have no PPA. I am very embarressed. I am almost ready to submit my application to the patent office. So, do I have to wait for my application number from the patent office befor I can try to license it?
Shall I contact this company and ask them to sign a non disclosure at this time? ALSO..>>> Do you not need a lawyer to make this contract.? Much to my surprise this law firm I used in the past has 18 lawyers and they said they could not help me.. Thanks for your time. God Bless.
Best wishes;
Bob Garabedian Friant, CA. 93626-0176
How do you make sure that you have done a good enough search before you file a Provisional Patent? When I have talked to a Patent attorney they say that I have to pay all this money for the search. What will happen if I didn’t search enough?
Great question Joan.
Yes, it’s a good idea to do a patent search. I have a professional patent searcher teach my students the techniques they need to know in order to do a good patent search on their own. Patent searches are very expensive. Quite often it doesn’t make sense to pay a professional patent searcher to do one.
If a patent search is really important for a particular idea. You may do one on your own, then share what you have found with a professional for them to see what else they can find. Doing this will save you quite a bit of money.
To be honest with you, I don’t worry about the patent search that much. I focus more on the market search, which is a search of what is and isn’t in the marketplace(stores, catalogs, internet ect).
The fact that someone got a patent on something doesn’t verify much of anything other than they spent the money to get a patent.
When you see other products in the marketplace with similar benefits to yours, that’s great confirmation that people want a product like yours. The product wouldn’t stay in the marketplace long if it wasn’t selling. Studying the Marketplace is way more important than searching for prior patents in my experience.
I hope this was helpful. You can get more tips like this on my internet radio show I do once a week here.
http://www.inventright.com/inventright_invention_radio.shtml
Keep Inventing,
Stephen Key
Hello Stephen,
I am a 21 year old college student who has had the dream of being an entrepreneur since i started selling computer products online at the age of 15. It is very easy for me to think of new business ideas that i think could potentially become a very profitable corporations with the right planning and funding. -There are a couple of ideas that i have written 20-40 page business plans for, but worry about receiving funding. I have been skeptical about selling ideas to and existing companies (Selfish Haha, Why let you make millions when i could do the same) and always wondered if it was possible to sell a business or a business idea that wasn’t already in existence, and while trying to find the answer i came across this blog entry.
I have Three worthy (I think) ideas that i am working with at the moment.
2 of ideas are pertaining to a social networking website with an advertisement feature that could make a company like twitter, google or microsoft billions.
And 1 is a Product that would be a little difficult to build a prototype for.
If you have some free time i would really appreciate if you could shed some light on this as i seek to find someone who could give me advice.
Also my personal email is
Bcmitchell2011@yahoo.com
Thanks,
Brandon Mitchell
Hello Brandon,
Yes, i have the same bug for Entrepreneurship. The only thing is i don’t like to deal with all the everyday things about a business that can be not so much fun like employee problems, cash flow, distribution, shipping problems, workmans compensation and eighty hour work weeks ect, ect.
I like to keep things simple. That’s why i license my ideas, collect royalties and let a manufacturer worry about all those things.
You can most definitely license a business method, but I would start with a physical product first. It’s going to be an easier place to get your feet wet, learn how to license ideas and receive royalties.
Feel free to call me at 1-800-701-7993 if you want some more advice. I’d be happy to give you 15 minutes of my time for free. There is no way i can teach you everything i know about licensing in 15 minutes, however I can help point you down the right road for you.
Hello Brandon,
Yes, i have the same bug for Entrepreneurship. The only thing is i don’t like to deal with all the everyday things about a business that can be not so much fun like employee problems, cash flow, distribution, shipping problems, workmans compensation and eighty hour work weeks ect, ect.
I like to keep things simple. That’s why i license my ideas, collect royalties and let a manufacturer worry about all those things.
You can most definitely license a business method, but I would start with a physical product first. It’s going to be an easier place to get your feet wet, learn how to license ideas and receive royalties.
Feel free to call me at 1-800-701-7993 if you want some more advice. I’d be happy to give you 15 minutes of my time for free. There is no way i can teach you everything i know about licensing in 15 minutes, however I can help point you down the right road for you.
-Stephen
I read the article and was fascinated to find out that I was doing everything wrong, just as you described! I have many prototypes and no sales. How do I find the manufacturers I need to pitch my ideas?
Linda Fitzpatrick
Danville, CA.
wildwife7@comcast.net
Hello Linda,
That’s step number 1 in my system.
You want to go down to the stores where you want your products to end up and make a list of manufacturers already selling similar products in those stores.
-Stephen
Stephen:
I have been sweating and dying over a provisional patent application for months but I really don’t know what to do. Any advice?
Thanks so much!
Kathlene
Stephan,
I have ~30-60 ideas with sell sheets for most.I have only been able to get in front of two companies with my concepts, though I have contacted many. Do you have any advice for getting the face time and getting the companies and possibly signing an NDA?
Thanks,
Dave
Hello Kathlene,
Sweating and dying! That doesn’t sound good.
Doing something new with no support or guidance can be very stressful, not to mention risky.
We do free 15 minute one-time consults for people new to the process. Feel free to book an appointment with my business partner and inventRight Co-Founder Andrew Krauss at http://www.inventRight.com/411
He’ll get you in the right frame of mind and help you out. He’s very helpful and is really patient with people new to the game of licensing.
-Stephen
Dave,
My advice is not to try to get face time. Instead contact companies over the phone. Face to face meetings are a waste of time and money.
Make lots and lot’s of calls. Works great for me!
Keep Inventing,
-Stephen
Hello Mr. Key,
I had purchased a couple of products of which one had something on it that was great, and would work perfect for the other product. I came to the conclusion, that this should be on the other product. Two different companies two different products. How can I take an idea from one company and sell it to another or multiple companies? Please advise.
pwrtogetwealth
lth
That will all depend on what your changing or if moving the idea over to another area changes something about the idea. If it does, it may be licensable.
I was wondering when you call these manufactures…what would you say without giving your idea away over the phone? since there is no NDA on the Phone?
You never try to pitch an idea on the phone. That’s like trying to explain how to tie your shoelaces over the phone. You want to get permission to send them a sell sheet which is a one page advertisement for your idea. Let your sell sheet do your selling for you.
That’s what we’ve been teach our inventRight students and it’s been working for the last 12 years. No one wants to listen to an inventor or product developer ramble on the phone. Be a pro and send a sell sheet!
Hello I have an idea about a company needing to change something, or have another updated company come in to help the other company. I am so confuse. Any advise??
Tim, when is part 2 coming out? Unless it’s already out and I can’t find it?
thankyou for your info
years back I had a black book and came up with dozens of ideas that are now in the market,
I want to do it again, but I want to license not patent, just license and come up with more, I see opportunities when I see products and needs.
how can I find someone that will work with me. and become partners with them, I just want to build a nice extra income.
thank you
Jesse R. Cano
omegafunding7-at-hotmail.com
10/06/2010
Jesse,
File a PPA (Provisional Patent Application). You can do it yourself and it’s only $65, then when a company show’s interest…. get them to pay for the patent. We show our inventRight students how to do this.
A PPA will give you a year to shop your idea around and say Patent Pending. You can file it in common english. Anyone can do it!
My name is Rehan Masih, i live in pakistan i have more new invention ideas in my mind and those i write down in my note book how can i rent my ideas i have ideas but not technical information please help me.