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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Holly,
This is great. I call it mix and match. You take two products from two different categories and combine them. A camera phone is an example of this. Or a screwdriver with a flashlight on it.
Then you license it to whomever would carry such a product.
Keep up the good work,
Stephen Key
Amy,
Great question. The answer is you never try to sell your idea on the phone. When you are calling companies, you are asking permission to send your sell sheet or sell sheet video, not trying to describe your product. That would be like trying to explain to someone how to tie their shoelaces over the phone. Never try to sell on the phone before they see your sell sheet.
RE: NDA’s – That would take 45 minutes to go into. I couldn’t fit it all in this little box. I do however teach what to do about NDA’s during our live webinars with our students.
Keep up the god work!
Kindest Regards,
Stephen Key
Jesse,
Check out our free radio show and webinars at http://www.inventRight.com
I think they will give you some direction.
Stephen Key
Kdan,
Part II is here
http://www.fourhourworkweek.com/blog/2007/11/27/how-to-rent-your-ideas-to-fortune-500-companies-part-ii-plus-hacking-japan-tips/
-Stephen
Hi Stephen,
I pre-ordered your book. Thanks for the informative Q&A that you did with Tim Ferris and the video about your spinner idea.
I have a lot of ideas that can make billions of dollars for companies smart enough to rent them from me.
One thing I don’t understand is this: If you’re a millionaire from your product selling and renting, why not just give away your book as a free e-book, and post your DVD set online for a small membership fee, or a one time fee, of $27 dollars. For someone as wealthy and successful as you are, why not just reduce the price or share the knowledge?
Yes!
Kris Kemp 🙂
I believe a Direct Response campaign would be the most successful launch of my idea, but all the info I dig up reiterates what I’ve seen and heard for years. You produce and air the infomercial, produce sufficient sales volume and we may be interested.
Skeptism aside, I’m going to move ahead. But skeptism rules when this product will surely end up being manufactured in China. Is there any protection provided by the PPA outside the US? Any protection from US distribution of my foreign produced idea? I know you don’t have legal advice to give, but have you ever gone the Direct Marketing route where first year sales could reach the millions like the “Snuggie”?
Steve Hudson,
Regarding direct response. Why not license to a company that does direct response. Let them take the financial risk.
A US PPA only covers you in the US, not overseas. Regarding foreign produced products. You can stop them at the docks if you have a US patent.
Stephen Key
Hello Kris,
Your welcome for the Q&A i did with Tim. I’m glad you enjoyed it.
I like your enthusiasm, but few ideas can make a billion dollars. I’ve always done licensing because it allows me to do what I’m passionate about which is coming up with new product ideas and then seeing people enjoying them.
Money is not my major motivator for either my students or myself. Yes, you can become rich licensing ideas. I’ve noticed that ideas are most of my students passion first and that money comes in second.
Kris, I think you will be more successful as a product developer if you are passionate about coming with ideas rather than being motivated just by money.
I see no need to give my $14.95 book away for free. I don’t think people take things as seriously when they are free. I can get my 30 years of experience out to more people by charging $14.95 for a book and getting it out into all the stores than i would if i gave it away as a free ebook.
My business partner Andrew Krauss and i have spent ten years honing our skills at teaching people new to this game how to license their ideas. I think that’s worth $14.95.
Regarding our course. We give a year of unlimited phone support to our students that buy our course. I’m not sure how we could give that away for free. Instead we have students that take their licensing endeavors seriously. We support them one one one over the phone and with weekly live webinars that keep them energized and moving forward.
I’ve gotten back ten time more than I’ve given over the years with my http://www.inventRight.com business. And I’m not talking about money.
It’s a great feeling to help people become the successful inventors they have dreamed of for so many years. I should be thanking my student for everything they have given me.
I wish you much success in all your invention related endeavors.
Stephen Key
Followup to my post on Oct. 25th.
Who should I approach to present my idea to in the Direct Response arena – the infomercial producers, the one stop [or so called] Direct Response companies, known contract manufacturerers in China???
Who has the authority to go after an idea; who would you approach?
Steve Hudson,
One of our students at inventRight just licensed to an infomercial company only a month and a half ago. Go visit our home page at http://www.inventRight.com and click on “How Timea Licensed Her Idea” on the right hand side of the page. The video is a full hour and it’s free.
No, you would never go to a contract manufacturer in China to license your idea. You go to the companies that sell and have distribution in the stores you want to be in.
Stephen Key
Thanks for your responses.
Stephen key
i had a look at your website and read some of your help sections when you say to talk to a manufacturer about your idea, isn’t that taking a big risk if they liike your idea and you dont have a short term patent on it can’t they easily steal it like what happened to the intermittent wipers guy.
i understand that you dont know whether you could actully sell it before you show your idea to a manufacturer but there’s gotta be a way to safeguard before you talk to them, please explain.
Nathan
Hi Stephen,
Love the straight forward clear presentation.
My question is who you look for/ ask for/ department… to contact when calling potential investing companies??
Thank you for time and giving knowledge.
-a young entrepreneur-
Dear Stephen,
I have read your website and blog which benefit for me ,please keep going,I appreciate it.
I’m a Taiwanese people in Taiwan and I don’t have “United States Permanent Resident Card”.
How could I licensing in America ? what’s your suggestions about me ?
Best Regards
Tony Lee
Nathan,
Companies don’t want to steal your ideas. Here are a few reasons.
* They are more afraid of you than you should be of them.
* Law suits
* Bad Publicity
* When you talk with companies you can and should create a paper trail.
* You’ve got your inventors notebook which is FREE.
* If you conduct yourself professionally and be reasonable, they will respect you and see that you know what you are doing. If a company was not ethical, they would decide it’s easier to pay you than to mess with you.
Now I’m not saying an Inventor can never get ripped off. It can and has happened, but you could also get killed in your car going to the grocery strore, but you still go don’t you?
In ten years of coaching inventors with my business partner Andrew Krauss I’ve never had a student get ripped off.
What’s much more likely is that an Inventor (not one of our students) rips themselves off by never making calls to sell their idea.
Stephen Key
Morgan,
I give a whole one hour lecture to my students on the topic of how to call companies to sell your idea.
I wouldn’t be helping you if i told you just who to call and not how to call. And of course i can’t go into all that in the comments section here.
I will say that Marketing and sales are the two best departments to call a lot of the time, however there are exceptions to that rule.
There are also specific techniques that i teach about what to say when you get a hold of a marketing or sales person.
Stephen Key
Tony,
It doesn’t matter where you live.
We have students in 30 countries. You can license from anywhere.
You will not be flying out to meet with these companies. Everything is done over the phone and via email.
Most of our International students use skype to call and the internet to do their research.
You can license from anywhere!
-Andrew
Thanks for your responses ^^
Hi Stephen
My idea is one for a different marketing channel for a certain sector of large businesses. I am hugely confident that this new channel would bring them lots of extra customers, but don’t think this kind of idea is something I could Patent…
Is there any way I could sell this idea to the large companies in question without them copying it as soon as I told them what it was?
I think this way of selling could make a very material impact on sales figures for the businesses in question.
Thanks!
Richard,
I’d do some research on “Business Method Patents”. They are being given a hard time in the courts these days, however it might be one way to protect yourself.
Stephen Key
Stephen,
I believe I have a great idea for a multi million pound company that can increase sales massively. I don’t know what is an acceptable price to ask for the initial fee foruse of my idea. Is £50,000 ridiculous to ask for?
Brandon
Hello Brandon,
It really depends. I’ve always found that front loading the deal and asking for a bunch of money up front when the manufacturer hasn’t made a dime yet, doesn’t work.
I like to get a royalty per unit for as long as the product sells.
You see, when you license ideas, you aren’t really selling them, you are renting the. You’ll make more money that way.
-Stephen
Hello Stephen,
I have a business plan for a new social network but I do not have the finances nor resources to have the website developed. Is it possible to sell a company a business plan or business idea.
Brandon,
You could license a social network technology or method of doing business.
Stephen Key
I’ve been reading up on patents in the Uk and people seem to think that is takes a long time (a couple of years) to obtain a patent, how is it possible to obtain a patent quickly and cheaply?
Brandon
Brandon,
I’m not a patent attorney, so i can’t offer you legal advice.
I can tell you what i do. I file a US provisional patent application. It’s only $110.
It would take to long to go into here, but there are around about ways to protect yourself in the UK by filling a US Provisional Patent Application.
We bring attorneys onto our inventRight student webinars to answer questions like this. I’m not an attorney and can’t directly answer your question.
What do you suggest is an appropriate percentage to ask for? Is 10% of the profits too much?
Thanks James
James,
Your royalty percentage can vary greatly. If they are selling a 10 million units a year you might ask for a lower percentage than if they are selling 5k units a year. It really depends on the situation.
Your royalty in most cases is based of the wholesale price. That’s the price the manufacturer sells to the retailer for. It’s easy to track the wholesale price. Retail sales are impossible to track unless the manufacturer is selling directly to the public.
5 to 10 percent is common for consumer products. This can add up to quite a bit of money if the company is selling a lot of units. On the other hand if your product is really a low volume idea, the money won’t be so great. That’s why higher volume ideas are better for licensing.
-Stephen
If I have an idea on how a web business could make a few small additions to their website and open up their market significantly. Would a PPA be appropriate in this situation?
Sorry, I should clarify after reading Richard’s post:
I know that this would probably fall under a “Business Method Patent,” but since a PPA is provisional, could it later be made into a BMP? Or is there a different patent available that is a Provisional Business Method Patent? My research on Business Method Patents are that they take a long time to go through…..
Kelli,
No there isn’t a separate PPA for business method patents. Yes, BMP are difficult to pull off and are getting challenged a lot in courts these days. If you have detailed patent questions like this, it’s always a good idea to seek legal advice.
-Stephen
Well, I guess my main question is that since my idea is technically a business method, would a PPA cover me? Could I still claim patent pending status with a PPA if my product is a method?
Mr. Stephen Key,
many thanks for the contributes you have provided to this (and other) community(ies) over the last 4 years.
I’ve some Intellectual Property doubts that I can’t seem to find an accurate answer for and, if you find the time, hope you may enlighten me.
First off all, I trully respect your ‘method’, I believe this is a great way to make a lot of cash with little individual involvement and upfront cash but only works if you can have several ideas. Thats my case, I’m clearly not an inventor. All I can think off has apparently been invented (btw: your spin label idea… I take my hat off sir, it’s so simple as powerful, congratulations). As I’m no inventor, I’ve to grab to all the little ideas I may have thus thinking that maybe 3% off retail may not suit my needs and try to go after the whole pot. I rather prefer and try the 4hww approach for lifestyle which is building a website, sell it yourself and automate. I think that, for ME, this is the method that will work.
Considering this, I’ve developed a new product idea (the only idea I’ve ever had…), I’ve searched over google products and it doesn’t exist (how is it possible?, I can see this idea rendering Millions… but maybe I should watch more of the ‘Dragons Den’ (Shark Tank in the US), wake up and smell the coffee). When I searched WIPO for patents on the item I’ve developed, I’ve come across a very (put VERY on that) rudimentary product of my idea. The following is a good example/comparision. Mr Ford developed the ‘car’ in 1900 and patented it. No more cars where invented over the last 111 years until I’ve invented the latest Ferrari looking car. Am I able to patent it? Would this be an ‘Improvement Patent’ (where I need the authorization of the inventor of the previous product in order to manufacture mine) or, as my patent is a ‘new product’ I can ‘just patent it’ and don’t need authorization from no one?.
I ask this because, they are both CARS, it’s true that my model have nicer colors, fine lines, more HorsePower, (more) technology, etc but it’s just STILL A CAR, it has 2 doors, 4 wheels a steering wheel, etc, etc, etc.
I wouldn’t know but it’s this what’s happening in the ‘Car world’ this days? Everyone is paying rights to Mr. Ford?
So, imagine that I fill the patent today, can I begin to manufacture and promote my invention as soon as I fill the patent? (I assume it becomes ‘patent pending’). What kind of problems (if any) this could bring?
If I’ve to license the previous invention ‘A’ in order to manufacture mine (‘B’) how is this processed?
Sorry if there’s something you didn’t understand clearly as I’m Portuguese 😉
Once again, thanks for your contributions.
Ze,
I can’t comment on your particular case unless i looked at the prior art. What i can say is that most inventions are just improvements to existing ideas. They are not completely new. You or your attorney need to determine if your idea violates any existing IP or patents.
I wish you much success with regardless if you choose to venture or license your ideas. Or both!
-Stephen
Hi Stephen,
My product is a combination of two non-unique ideas into a unique idea. I will exhibit at the National Stationery Show this May. I have a website and my product is in stores, so it is certainly not a secret.
A Hawaii products distributor offered me $1.25/unit if we produced them in China. But I philosophically want to manufacture in the USA. We agreed to $1.75/unit with me controlling manufacturing. Seems like I bought a lot of headache for only 50 cents more per unit! But I really want a Made In USA product.
Do you recommend having a PPA before the tradeshow May 15-18. Is it appropriate and is there time for me to pursue a PPA? The tradeshow will be a great place for me to pitch my product concept to manufacturers as well as buyers. Appreciate it if you looked over my website and gave some guidance as to licensing viability.
Hello Lindy,
RE: Working a tradeshow
We just did a radio show entitled …..”How To Win At Tradeshows” yesterday 04/13/1. It’s free. You can listen to it here.
http://www.inventright.com/inventright_invention_radio.shtml
——————
RE: PPA(Provisional Patent Application)
Yes, filing a PPA is a good idea. It’s only $110 and you can claim patent pending status.
-Stephen
Stephen –
Could you make your new book available for Kindle? Thanks.
– Travis
Travis,
Your in luck. My book IS available on the kindle.
The title of the book as you know is “One Simple Idea”.
The book covers my ten steps to selling your ideas and is available both on the kindle and as a hardback book.
Kindle link
http://www.amazon.com/One-Simple-Idea-Licensing-ebook/dp/B004H4XL8S/ref=kinw_dp_ke?ie=UTF8&m=AG56TWVU5XWC2
Hardback Link
http://www.amazon.com/One-Simple-Idea-Licensing-Goldmine/dp/0071756159/ref=sr_1_1?ie=UTF8&qid=1302796235&sr=8-1
-Stephen
Stephen,
I am looking in getting a PPA for a product that is already available but it’s not the product i want to patent it’s the process of how the product is made, is this possible?
Thanks Jon
Hello Jon,
Excellent!
What you are talking about is a “Method Of Manufacturing Patent”. It’s basically a utility patent, but on the method that is used to manufacture a product.
I have had over 13 patents on “the method of manufacturing” for my spin label Invention and have sold millions of labels due to the fact that i have protected my idea this way.
Please feel free to give me a call at 650-793-1477 and I’ll give you some advice on moving forward with your idea.
-Stephen
Hello Stephen
Could you tell me what my licensing contract should contain, I know it should contain a mimimum guarantee clause, performance clause and that the manufacturer is responsible for paying to upgrade the PPA in my name but what else?
Thanks James
I’ve got an idea for a new beverage that I want to license to a manufacturer. I have a recipe, though I feel like the manufacturer might need to tweak it a bit before it’s ready for consumers (maybe add a preservative, or some other mysterious ingredient from a food scientist). I also have an innovative packaging idea and a very detailed marketing plan.
I’m wondering if a PPA is right for me, if I need to get more than one. Also, I have been thinking that in order to safeguard the idea I should have the recipe exactly as necessary for production.
Finally, I’m a little intimidated by the beverage industry. Have you had any experience in licensing food or beverage products?
Thanks!
Clay
Hello James,
Here are two other major deal points…..
Your also going to have your royalty rate, territory covered ( for example USA or Worldwide).
Their are many other details that also need to be included that are to various to go into here.
-Stephen
Hello Clayton,
The beverage business and packaging business are two very different types of biz, so the advice would be different for each.
Yeah, the beverage biz can be a bit intimidating at times. I have some experience there. Give me a call at 650-793-1477 if you want some advice.
I have even more experience in the packaging biz. That’s a tough biz too, but the royalties can really add up because such huge volume is done there.
Yes, the PPA is a great tool and a good idea for your packaging idea. You need to decide what is right for you though.
You might also want to consider keeping things a trade secret for your beverage idea, although some beverage ideas can be patentable. You should also consider the use of NDA’s.
You really need to do your research and understand your options before taking any action. Please seek the services of an attorney if you need legal advice.
-Stephen
Hello Stephen:
I’d appreciate your assistance when you get a chance.
I was wondering what your take is on smart phone app ideas. Which choice below would you recommend? Why or why not?
1. Licensing you smart phone app idea and receiving about a 5% royalty on a product that costs $1
2. Incurring more cost by hiring a personal developer, but obtaining full ownership of the app
Also, can you get a PPA on a smart phone app idea?
Thanks again for all of your help. Look forward to hearing from you soon.
PJ
Hello PJ,
I think you could go either way with your app idea. Each has it’s upside and downside. It’s really what’s right for you.
It’s all about volume with licensing. 5% of a $1 app that only sells a limited amount of units will not add up to much money. Also, keep in mind that royalties for software are quite often much higher. I would ask for a higher royalty than 5%….. especially if your app is for a nitch.
If you only spend a week or two pitching an app idea and the software developer develops the app and pays you your royalty, risking their money in the investment and not yours, that’s not such a bad deal.
On the other hand, you could develop it yourself. However if you don’t know how to promote it, you may never even earn the money you invested, plus there’s all the time and hard work you put into the project.
Their are a million and one apps out their. You not only need to write a good app people like, but you also need to know how to promote it. An app manufacturer with experience in this area may be better equipped to do this than you.
So, again, take a look at what you like to do. Come up with ideas, sell them and move on? Or run an ongoing business.
One is not right or wrong. It’s what’s right for you.
-Stephen
Stephen,
Thanks for the great advice! I completely agree with you.
I’d be extremely grateful if you could answer a few more questions for me:
Is it possible to obtain a PPA on a smart phone app?
In other words, what is the best way to protect your app?
Will a copyright of your app suffice?
Thanks again, and I look forward to hearing from you.
Cheers,
PJ
Hello PJ,
Without having more specifics(which would not be appropriate for this forum since it is public) I can’t answer your question about what type of intellectual property you should seek. That’s the type of question you should ask a patent attorney since you are asking for legal advice.
-Stephen
Wow, I’ve found this post after a few years of buying the 4 hour work week. Me an my brother came up with a small, but good idea (we think) and I wanted to re-check this post.
Stephen – I can’t believe you’re still sticking so close to this post. That should speak volumes.
Also, has anybody had anything licensed after being motivated by this post alone?
Like many inventors I had an idea but felt powerless to pursue it. After reading this blog I thought I could pursue my idea. I did a patent search and found that the idea was already patented and had expired. I also found three or four high-end products that were already being sold. I had never heard of the products that’s why I re-invented it. I believe the idea could appeal to more people if it was cheaper and more widely known.
My question is, is there a way I could sell this idea to other companies who are either unaware of its existence and/or could mass produce it for less? I won’t have any patent protection but I feel the idea is worth something for bringing it to their attention.
-GTS
GTS,
Great question. I would never expect a company in a particular product category to not be aware of similar products in the same category. That would be a bad idea.
What i would recommend is to keep inventing. Come up with with that low priced version you talked about. Maybe to get it low priced, it would be done differently making it possible to get some patent protection.
Ryan,
I really enjoy teaching people how to license and sell their ideas.
Sometimes people ask me why i do it.
I tell them I’ve gotten ten time more back from teaching and mentoring than I’ve given and I’ve given a lot. It’s so rewarding to get people unstuck and moving forward with their projects. There is much more to life than money.
My business partner Andrew Krauss does a lot of our coaching and has commented that we keep people from “What If’ing” themselves into inaction. “What if” the manufacturer says this or “what if” they say that?
He’s also said “By making sure our students do and say the right things we take away the great uncertainty that many people with ideas have.”
Thank you for the kind feedback. I wish you and your brother much success with your idea.
Stephen,
It’s great to see that you are still responding to questions years after the original post. My question is this: how important is it to have drawings included in your provisional patent? I just got “down-sided” a week ago and decided to finally pursue one of my inventions, but I don’t have a lot of money to spend. It’s a pretty simple design which I hope will be the next big exercise fad. Do provisional patents need drawings to be accepted? And, if so, do you think I should try to draw them myself or hire someone to do them?
Thanks,
Adam
I meant to say “down-sized”
Adam,
The great thing about Provisional Patent Applications is that you don’t have to have formal drawings like you see in a Utility Patent. You can even include pictures if you like!
With that said, you want the drawings and the parts you are calling out to be clear. So just because you can include pictures doesn’t mean you should if they are not clear.
Another trick is to make a prototype of some sort(it may be really ugly) and then trace a picture of it to create a line drawing. You can do this by putting the picture on a glass table… shine a lamp up through the bottom and put a piece of paper on top to trace your photo. Or you could do this in Photoshop.
Stephen,
Wow. If my calculations are correct… you’re replying to this four year old post while on VACATION. Nobody can question your sincerity in helping people.
I bought your book, One Simple Idea, in July and when it arrived on my doorstep I read it cover to cover… taking all of your advice to heart – especially steps 1 and 2 (to study and innovate FOR the market). I’m doing that now while I set up my LLC so I can quickly send a professional looking sell sheet packet when I get the first interested manufacturer on the phone. I just have a couple questions:
#1 > You are well known for personally taking the phone calls of your students… even pre-students like me. When someone signs up for the inventRight course and they get ‘one year of personal coaching’… what happens after the year is up? Are we allowed to call you again?
#2 > Is there a follow on ‘year 2 plan’ and ‘year 3 plan’ at a reduced membership rate? Or a ‘lifetime student’ package?
Thx Stephen! I’m thoroughly enjoying your website’s 1-hour webinar interviews with those students who have successfully licensed their first products with your help… great motivation!!!
Dave in VA
Hello Dave,
Sounds like you are taking action. That’s fantastic! Keep up the good work.
Regarding your questions:
Question #1
“#1 > You are well known for personally taking the phone calls of your students… even pre-students like me. When someone signs up for the inventRight course and they get ‘one year of personal coaching’… what happens after the year is up? Are we allowed to call you again?”
Yes, I personally talk to any one of my students that wants some advice from me. I am proud that we don’t make it hard to get a hold of me. Anyone of my students can reach me anytime.
But, of course I don’t take all the support calls. I Co-Founded inventRight with Andrew Krauss 10 years ago and couldn’t run the business without him.
He’s the most patient guy I know and takes the vast majority of our support calls. Over 10 years, he and I have become very skilled at coaching our students. We honed our approach together. In addition to my own personal experiences, much of what you’ve read in the book “One Simple Idea” is based on the principals we’ve developed over the last 10 years of coaching our students.
After 10 years, i would hope that anyone would be great at what they do day in and day out. Andrew Krauss runs the business and is always there for our students when they need him. So, if you become a student, you would be wise to get help from him.
Yes, you can renew at a lower rate after year one if you like. However, the goal is to get you familiar with all aspects of licensing during your year with us, so that you don’t need us anymore.
Question #2
“#2 > Is there a follow on ‘year 2 plan’ and ‘year 3 plan’ at a reduced membership rate? Or a ‘lifetime student’ package?”
Yes, you can renew at a lower rate for year two and three if you wish. There is no lifetime plan. We’ve been doing inventRight for 10 years, and have no plans to stop, however I don’t see how we could commit to lifetime plan.
-Stephen
Stephen, I am currently in the process of reading your informative and intriguing book, One Simple Idea, and I must say, it has definitely enhanced my thirst for innovation. I am young, and I suppose age does not matter all that much, but possibly it does in terms of limited experiences in this realm. I have many ideas that are circulating in my brain at this moment, but one of my ideas, I feel, needs to get to the market as soon as possible. With that being said, I completed a benefit statement and am currently working on a selling sheet. However, I am now wondering if my idea would be applicable for filing a PPA. I know they are only possible for utility patents. A similar product is already in the market (to some degree), although the underlying concept and aesthetics is what differs. Basically, a modification to a pre-existing product. Does this idea seem to qualify under the branch of a utility patent? Thank you in advance for your help!
Hello Stephen
I have an invention that I want to licence and sell to a major company (lets use mc donalds as the example) how do I get them to take me seriously? And how do I get them to give me a chance to show them my idea?
Also how do I go about getting worldwide protection on my invention? I only want a provisional patent application but is there a way to get worldwide protection from this method of protecting my invention?
Can’t wait to hear back from you!!! I am from the UK is there an email where I can contact you directly?
Thank you so much
Brandon
Hello Stephen
I have an idea that I want to patent and sell to a large company (lets use mc donalds as the example) how do I get them to take me seriously? How do I get them to allow me to have some of their time and show them my invention?
Also I want worldwide protection on my idea but how do I go about that with only a provisional patent application?
Many thanks
Brandon
Brandon,
One trick to get into a really big company is to go through their advertising agency. They are responsible for coming up with new campaigns and showing them to their client. I’ve had some success with this approach.
With regards to your worldwide patent question, you can get temporary protection in many countries at once by filling a PCT. I don’t have the space to go into the details here. I suggest you look it up on the Internet or talk to your patent attorney to get more info.
-Stephen
Stephen, many thanks for generously answering all the questions on this blog. It’s much appreciated.
I’ve not even finished your book yet, so I’ll refrain from asking any of my own for now 🙂
Ed
Ed,
Enjoy the book !
I look forward to getting a question or two from you once you finish the book.
-Stephen
Stephen,
Have you or anyone else here tried filing a provisional patent using the USPTO’s EFS-Web? The whole process is just so frustrating. I get that you need to submit a Provisional Cover Sheet (SB16), but what other information is needed? How do you submit the rest of the information? Do I just put an abstract and description in an ASCII text file? How should it be formatted? Do I need to embed illustrations in a PDF to submit them?
Trying to sift through the mountain of garbage on the USPTO’s website to find the answers to these questions can drive a person mad. It shouldn’t be this hard.
I can find plenty of examples of existing patents, but where can I find examples of files to be submitted through EFS-Web to apply for a provisional patent? Or, if no one knows, is there a forum somewhere that I can ask?
Thanks,
Adam
Stephen, thank for your offer, here’s the first one: I have an idea which can make a particular class of consumer products much more attractive, but it involves REMOVING rather than adding something.
Is this kind of thing patentable? It’s a very simple idea, obviously doesn’t add to the cost, is pretty obvious, and has been used on different types of products for decades.
All I’m doing is suggesting it be used for a different class of products.
Maybe there’s a different way of protecting this idea?
Thanks in advance!
Ed,
I get questions like this all the time. There is no way i could know without looking at the product and also the prior art.
-Stephen
Fair enough, that makes sense. I’m talking with a few other licensing specialists, so I’ll follow up with them for now. Thanks again for replying.
Ed,
Feel free to book a one time free phone consult with my business partner Andrew Krauss.
You can book an appointment with him at http://www.inventRight.com/411 then call him at 650-793-1477 at the time you book.
We are not attorneys and can’t offer you legal advice, however Andrew may be able to give you some ideas as to what you might protect from an Inventors standpoint.
-Stephen
Thanks, Stephen, that’s very generous. I’ll call.
Hi, Mr. Tim
I am currently reading the expanded version of 4HWW and I’m in the verge of making a major turn around in my life. I have a prototype (Haha big name) for a product and I need ideas as far as where to go to get it manufactured. this is a beauty/ OTC product. I welcome any suggestions or ideas from advertising to website design. thank you all,
L
L.,
Pick up Stephen Key’s book, One Simple Idea, and follow the 10 step plan. In talking about looking for a manufacturer so you can advertise your new product company and website… you are about to slip over the side of your boat into dangerous and choppy waters. Don’t do it all yourself! Instead, save yourself a lot of money and frustration by simply “licensing” your idea… the Stephen Key way. Good luck to you during this exciting time!
Dave Duke
Jr. Product Developer
Port Royal, VA
Dave,
Thanks for the kind words about the book, “One Simple Idea”.
L Ricard,
Let me know if you have any questions about licensing.
-Stephen
Hello Stephen,
I’d appreciate your advice on situation I’m dealing with.
I have an invention/idea for a niche market which I would like to sell to a high-profiled company in this specific market.
My product can’t be protected by patent because at its core its an idea, and it does not fit into the patent categories.
Also, I have a prototype which I would like to use when I present my idea to these companies.
What is the proper way to approach these companies with my idea if the idea can not be protected by patent?
Having done some research it seems like copyrighting the product and using a non-disclosure agreement before disclosing the idea can help protect it. However, I have this concern that after I show a buyer my idea and we sign a non-disclosure agreement, the buyer can easily say “Oh we already thought of that idea before you showed us,” and then they just take my idea. How can I prevent this from happening?
I’d really appreciate any advice here, Stephen. Thanks for all your help.
P
P,
Yes, NDA’s are one way to protect your idea when you can’t get a Patent or a Provisional Patent.
Copyrights and trademarks will also work in some cases. It really depends on the idea.
In ten years of teaching our students how to license ideas, I’ve never had one of our students get ripped off. It’s possible and I’m sure it will happen one day. It’s just a numbers game.
However, I think the reason why none of our students have had an idea taken is because they are conducting themselves professionally when they talk to companies.
Conducting your self professionally and looking like you know what you are doing is actually one of your strongest forms of protection.
-Stephen
Stephen,
I have a product that was invented by my grandfather in the 1980s. He patented it and tried to sell it but had no luck. He passed away in 1985 and now the product’s patent has run out. What would be the best way to try to license this product?
The technology of it has been surpassed but I have come up with a new way of marketing it to new group of consumers.
Thanks for all your amazing work and generosity.
Ernie
Ernie,
First off ….. I think it’s great that you are trying to continue on your grandfathers idea.
If the technology has been surpassed and the patent has expired, your going to need to come up with a new way of implementing the idea.
Does this new way of marketing require you to change the product up and maybe give it a new patentable feature? If so, that would be the route to go.
-Stephen
Thanks Mr. Key.
Basically, the technology isn’t used much anymore but I have a new group to market it to. It could be modified to get the new patent, which is something that I learned a few years ago needed to be done when a patent runs out.
I think my grandfather would have done well to know a little more about licensing the way you do. I’m reading your book and it seems he did everything backwards.
I have a few other irons in the fire right now but I think I’m going to try out your course. Learning directly from you guys will help me out with my confidence both in approaching companies and with my confidence in this project.
Ernie,
I think your grandfather would be proud of you.
-Andrew
How would I go about presenting and protecting a website/marketing idea that is completely original and would produce massive appeal for the fashion industry? Is this possible to protect and if so, is it the standard Provisional Patent as noted above? Thanks-
Colleen,
Trademarks, trade secrets, copyrights and possibly business method patents.
-Stephen
Called Andrew and talked to him for about fifteen minutes. I’m amazed by the fact that he and Stephen find the time to talk to ordinary wannabees like me. Andrew was awesome to talk to, just an ordinary, nice guy with tremendous advice and solid, honest evaluation of my ideas.
Seriously, if you have an idea that you are not sure about just go onto the site, make an appointment, and make the call. I don’t know if I’ll get a licensing deal out of that fifteen minutes but it has definitely put me on the right track.
Thanks Mr. Key and Mr. Krauss. I appreciate it.
I have some good ideas,,,,,how do you find the right manufacturers? I have no idea who to get ahold of? kevin
Kevin,
First figure out where your product would sell. Then look around at the manufacturers selling at that retailer. Those are your potential licensees.
For example:
You have a hammer idea > Where do they sell hammers? > Home Depot, Lowes, Ace Hardware, Walmart, Target ect > Look who is selling hammers at these retail locations. > You know they are qualified because they have other products in some big retailers > DONE > You have your list!
-Stephen
Kevin,
When it comes to finding manufacturers, there are several ways to do it. One of the easiest is to just go to your favorite search engine (yahoo, google, bing, etc) and type in the main phrase of your idea plus the word “manufacturer”. That may seem obvious but I have had a lot of luck with that. Another method is to find brands of competitors for your idea or product idea. Odds are those brands have a common manufacturer or one that can do what you’re looking for. Once you find a brand, just do another search online for that brand’s manufacturer. I’ve found a bunch that way. Of course, if you can’t find the supplier of a specific brand, call up the brand themselves and ask someone who makes their product. Often times people will give that info out.
I know several people on here have mentioned Alibaba before and I’m sure it’s great but it seems very nebulous to someone who is just starting out.
When you do find a manufacturer, look for the “contact us” that is usually at the bottom of the page. Since you are going to need to call (not email) I always suggest using suppliers that are in your country just because there won’t be a language barrier. If it is your first time working with a manufacturer it can be a huge road block and you may not want to hire a translator at the onset of your business.
Hope this helps a little. 🙂
I recently stumbled upon this article and read the comments. There wealth of information amazes me.
I invented a product and have been using it in my company for a few months now. I recently took it to an industry convention. I had a small booth and did demonstrations showing the product and how it worked. The responses I recieved were a bit overwhelming. I received a very nice award for “Innovator of the Year” and almost every Distributor there wants to sell my product. Some want exclusives, one is offering financial assistance.
I have been manufacturing this product my self, and have received some quotes from other manufacturers. I have a provisional patent application on file with the USPTO.
I think I would like to try and license the product. Can I license it to more than one company and still offer it to smaller disrtibutors? It seems to me doing so would not be the best way, if it even can be done.
KevinP
KevinP,
Yes, you can license to multiple companies. You just need to think about overlap.
If you licensed to one company in Europe and another for US and Canadian distribution, that would work.
However, most of the time, it doesn’t make sense to license two two different companies selling in the same stores.
Maybe you have an industrial version and a consumer version. And two different companies with two different different distribution channels. That would make sense.
There are a million different scenarios. These are just a few examples. Just use common sense and you should be fine.
-Stephen
KevinP,
Congrats on all the interest you are getting. That’s fantastic!
Yes, you can license to multiple companies. You just need to think about overlap.
If you licensed to one company in Europe and another for US and Canadian distribution, that would work.
However, most of the time, it doesn’t make sense to license two two different companies selling in the same stores.
Maybe you have an industrial version and a consumer version. And two different companies with two different different distribution channels. That would make sense.
There are a million different scenarios. These are just a few examples. Just use common sense and you should be fine.
-Stephen
Stephen,
Just got your book last week and I’ve almost finished. Great information and I like how it builds and reviews everything. I have several ideas for products and 1 in particular I’m going to start with. i have a Provisional patent on it and I’m working on my market research still. I have a couple of questions.
How do I know how much it will cost the manufacturer to make it? I don’t know any industry experts to ask this.
When do you use a nondisclosure?
Thanks
Jason
Stephen,
My sincerest appreciation for your time and advice—I wish I had found this blog several years ago. Two of my closest friends and I have been working on a “newly revisited” product that we believe has tremendous potential. In its current state, it is used by everyone in the world. We have already produced a fully functional, aluminum prototype, acquired a Provisional Patent and have developed a “Promotional” website—geared at 12 of our favorite/hopeful manufactures.
We are currently in the final phase of personalizing a letter to the President/CEO of each company. which will be accompanied by a “Proposal to Sale” booklet….similar to the Single Sheet you’ve mentioned, but with just a few extra pages and a link to the website (these 12 companies will be the first to see it – as it’s aimed at inviting them to bid on the product – and closes on a certain date).
My question is—are we committing product suicide by opening up this idea to bid by competing manufacture/brands (perhaps coming across as “arrogant inventors” – assuming they would even enter into a bidding battle).
Or, if by chance, the idea were to be good enough—is it possible that we might receive and invitation to sell it out-right, which I think is what we would like (perhaps with some small royalty attached) Sorry, I know that sounds arrogant…but the existing market potential and current sales are well into the billions.
Thank you, in advance for your thoughts and comments.
-Steve
P.S. Great name by the way!
Steve,
When you pitch your product to companies, should never pit them against other companies. That is not the right approach.
Instead, just make a great sell sheet and see what their feedback is.
-Stephen
Jason,
One really easy way to figure out how much an idea will cost to make is to look at similar ideas in the marketplace.
Many times, you can make assumptions…….such as……
If they can sell THAT for $9.95, then i don’t see why they couldn’t make mine for around the same price. Look for similar products to guess if they can make yours. Quite often this is enough.
If the manufacturer likes your idea, they will let you know if they have manufacturing concerns.
If that doesn’t work for you, you can always go to a contract manufacturer like you find on http://www.mfg.com and get a price quote. Don’t tell them your an inventor. Tell them you are a designer and you have a client. This client needs THIS. Can you make it and for how much? Give them some big numbers to get an idea on price.
-Stephen
Gentlemen… How in the heck can you get an invention idea off the ground in 3 weeks…??? How can you get feed back from retailers on your invention without telling what it is..?? Especially a consumer product.
Can you approach potential manufacturers just after you sent your PPA in by U S Mail. Must you wait until you recieve your PPA Number?? Wouldn,t that be a waste of several weeks?
I am an 80 year old with a bx full of inventions. I can not memorize to well anymore. Should I not hire a licensing attorney to negotiate a deal for me??
I have never liscenced anything befor … Do you use a standard universal license agreement..?? Thanks for your time.
Best wishes;
Bob Garabedian pops12@netptc.net
Bob,
Usually it only takes two days or so to get a confirmation back from the patent office if you electronically file your PPA. No need to wait a couple weeks.
Three weeks is actually not unrealistic for a timeline to know if your ideas has legs.
For many ideas, you can get a good read if there is interest in your idea within three weeks of making your first calls.
No, there is no standard licensing agreement. Never use a template!
Andrew Krauss
inventRight Co-Founder
I am in the midst of filing my provisional patent application. Is there anything I should be aware of or lookout for specifically to protect my invention as comprehensively as possible? My idea could use several styles of one component. Should I state every possible configuration of this combination to be sure I am protected on all sides as well as every possible type of material this product can be manufactured with? Thanks-
Colleen,
You need to read up on Provisional Patents a bit. It would be hard to give a decent answer in a few paragraphs on a blog and do your question justice.
Our inventRight students use the patent software Patent Ease. Using patent software seems to go a long way as to guiding inventors along when filling a provisional patent application.
-Stephen
Stephen,
Hello, my name is Dean and i have a great idea and i want to know how do i get that idea or lisense it to a fourune 500 company.
And how do i sell it? I have no patton and i dont have a prototype and its a brilliant idea and i dont know how to get it in the market or how to get it on a commercial.
Please i need the right contact and the correct procces to go through to get my idea out there and to be succesful.
I need help and who should i contact first and what would be the best?
– Dean
Stephen,
There are so many sites out there that claim to know that big firms like Google will not listen to outside ideas.
I’m starting to believe them. Have you seen the Google page that allows you to give them your ideas free of charge:
http://www.google.com/support/contact/bin/request.py?hl=en&contact_type=bizdev&rd=1
You are one of the few encouraging voices on the Internet.
Does anyone list companies that are willing to look at ideas from the outside?
-Eric
Eric,
Yes, there are many companies that are open to outside ideas. We even started a free database of companies looking for ideas.
You can access it here.
http://www.inventright.com/links/
Of course, this is not a database of every company in the world looking for outside ideas, but it does illustrate that companies ARE looking for your ideas.
Really, the best way to make your list of companies for a particular idea is not to look for a list, but create your own list of the ideal companies that are right for the idea you are working on.
It’s as simple as going down to home depot for example if you are working on a new innovative hammer. Look around at who is selling hammers there and those are you potential licensees. Don’t worry if 11 out of the 12 companies you call aren’t interested. You only need one!
And don’t worry if a few don’t take outside ideas. It’s just a numbers game.
Andrew Krauss
inventRight Co-Founder
Hello Dean,
Your questions are a little to broad to go into here on a forum, however i will answer your question about where to start.
“Study The Marketplace” meaning look at all the other products out there in the same space as yours and compare the benefits and pricing of these products to yours. Be as objective as you can and figure out how your products fit’s in with what’s already out there.
-Stephen
Stephen,
You’re right. I didn’t mention my marketplace.
My product idea is for TV. It would be a great fit for companies like Google (who has GoogleTV), Verizon and Comcast.
I’ve researched the marketplace and there is no other idea like it.
As I posted earlier, Google won’t take ideas from the outside unless you donate them to their company. As if they are a non-profit!
Now that you know my marketplace, are there any lists of companies that accept ideas from the outside? I’ve already eliminated Google from the pack.
-Eric
Hi Stephen, I have invented a baby product that is unique in design and have been selling it on my website for the last 8 months (and have a Provisional Patent on it, but time is running out). I am now considering licensing it since (like you) I have discovered that I like inventing more than figuring out cash flow etc. My question is, can I license the brand name with the product or is it customary that they take the product on as whatever they want to call it. Also, (and this might sound naive) when you are talking about manufacturers in the market, are you talking about major brand names in the industry as the ones I should be researching and calling on? I guess my main concern with licensing this is that since it is in fashion (somewhat), if they would want to scale down my product using lesser quality fabrics etc and if so would I have say so over that? I plan on picking up your book to get a better handle on some things, but thought I would ask you yourself on these specific things regarding my product in the baby market.
Thanks so much!
Hi Tim; Invented a new product, launched the company in April 2011, been approached by companies for merger or other ventures, no takers yet. Billion dollar worldwide reusable bottle market. In over 70 Stores in USA and Canada, with reorders. http://www.pureglassbottle.com is like no product you have seen, if you break the glass bottle all glass and liquid stays within the clear BPA free coating. Here’s my problem, growth is slow but steady, I need a partner, licensing partner, or major marketing help. Willing to share in company.
Please look it over at http://www.pureglassbottle.com and watch the video under the tab;PURE Advantages to understand the product. Call me!
Mandi,
Yes, you would license to the companies with brand names.
And yes, you will loose some control. They may want to name your product something different or change the patterns or colors. However, you won’t need to run a company anymore or worry about cash flow since you’ll be receiving royalties.
Enjoy the book!
Andrew Krauss
inventRight Co-Founder
I co-founded inventRight with Stephen Key over 10 years ago
Walt,
Very cool!
A glass bottle without the breakage concern!
Yes, i agree. You need to find a potential licensee that can get it out there in a big way fast. Find several licensees that already have distribution where you want to be and license to them. We can show you how to do it if you like or you can do it on your own. Either way, i wish you much success.
Andrew Krauss
inventRight Co-Founder
co-founded inventRight with Stephen Key over 10 years ago
Stephen,
Hi my name is Mike. I have an idea on how to bring increased sales to one companies new product. It involves taking that product and renting it in a target market next to an other product by a different company. Is there a way to protect my idea even though it is just a marketing strategy? I am convinced there is a very small window before this is seen every where in this target market. Any advise would be greatly appreciated.
It sounds like only patentable ideas can be “rented” i.e. licensed.
Is it possible to rent an innovative idea to improve a company’s website eg. something that customers want improved and would attract them to buy more online, that no one else currently offers, or an app that does the same?
Cherie,
Yes, it’s possible, but it will depend on exactly what you are improving.
-Andrew
Mike,
We get that type of question often.
Is it possible to license a marketing idea?
Yes it is possible, however it’s definitely going to be more difficult than licensing a physical product. If they like your idea, it’s more likely that you could get a job as a consultant with the company rather than a royalty. If you were working at the company, you might get a promotion.
Andrew Krauss
inventRight Co-Founder
co-founded inventRight with Stephen Key over 10 years ago
Andrew,
Great, thanks for the response.
Are you saying it’s possible to do it without a provisional patent? If so, how?
Or are you saying that some website or app ideas are patentable?
An example would be that I have an idea for a way to hugely improve user flexibility for creating photo books online. One new company (and they alone, so far) recently took a half step towards my idea (without my help) and is now ranked #1, so that suggests that my idea could really make a huge difference.
Cherie,
I’m saying it’s possible to make an improvement to a web site or app and license it.
And yes, it is possible to patent an app.
However, without getting into the specifics, I’ll have to give you the answer patent attorneys always give…….”It depends”. Doesn’t that drive you nuts?
I can understand why they say that though. It’s because it depends on what has been done before and the prior art.
-Andrew
I have been most curious about this for a while now. HOW CAN YOU GET FEEDBACK FROM A MANUFACTURER WITH OUT TELLING HIM OR HER WHAT THE PRODUCT IS>>> ?? Also what should you do when most companies you contact even with your PPA … still want a patent..??
THANK YOU VERY MUCH FOR THIS SITE. I AM 80 AND STILL TRYING.
SINCERELY;
I.Bob Garabedian pops12@netptc.net
Hi Stephen and Andrew,
First off, I am very impressed that you take the time to respond to a 5 year old post. I don’t even respond to 2 day old Facebook posts and I’m not nearly as busy as you guys. Thanks for doing it I learned a lot.
I was wondering if you could please take a look at my idea, I did a pretty thorough product and Google patent search and it is original at least, hopefully good. I made a 1 min video of my prototype, short and sweet.
I sent the email to your inventright address I titled it “1 min Video” and my email is (hover over name for email). Thank you so much for your time.
Mahalo,
Albert Molina
Bob,
In most cases you wouldn’t want to try to get feedback from a manufacturers without telling them what it is. They don’t have time to play a guessing game with you.
However there might be instances where it would make sense. In that case, just tell them what the benefit of the idea is and see if they want more info, however at some point you will need to show them your idea.
A few companies insist on you having an issued patent and don’t like it if you have a PPA. I would just move on. Most companies are ok with a PPA.
Andrew Krauss
inventRight Co-Founder
co-founded inventRight with Stephen Key over 10 years ago
Hello Andrew and Mr. Key;
That old guy Bob Garabedian here. WOW,,, how neat. How I wish I met you guys 20 years ago. I am taking your advise and only going to try to go after the companies that are interested in my products. If they do not except a PPA … just go on to the next one. I really wanted the big guyz because they have all the marketing all set up already. BUT, some thing is far better than nothing. ALSO, because of your kindness to HELP us dummer guys I will send you free samples of my products when I get them licensed. I hope you can use 3 new trash cans. My next product will be the mechanics pocket wrench. THANKYOU.
Best wishes;
I. Bob Garabedian Friant, Calif
Albert,
Your welcome. Stephen and i really like what we do. It’s great to open peoples eyes to the possibility of licensing their ideas.
Absolutely Albert. I’ll take a look at your idea and the email you sent.
Andrew Krauss
inventRight Co-Founder
co-founded inventRight with Stephen Key over 10 years ago
Bob,
Your are welcome.
Keep up the good work. We look forward to the samples.
Andrew Krauss
inventRight Co-Founder
Hello Andrew;
I just drew up a drawing of a trash can I improved by adding tools to it . Can I still PPA that?
Thanks Andy.
Best wishes;
Bob Garabedian
Bob,
I’ll have to give you that very annoying answer that patent attorneys always give…. “It depends”.
I know, i don’t like it when patent attorneys say this either, but they are right.
It really depends on what’s been done before and what’s already been patented.
I’d suggest doing a google product search and a google patent search.
And then contacting a patent attorney to ask their opinion.
-Andrew
Stephen and Andrew,
Someone new to Tims blog I was pleased to find this post and have a few ideas that I will be pursuing in the direction of licensing rather than branding my own business. Thanks for the direction! In reading all of the Q and A, I had one follow up question. You mentioned becoming a consultant to a company.
How does one approach a company as large as say Amazon? I have an idea that would be VERY simple for a similar type of company to integrate into there current system.
And while I cannot provide exact figures to the company (they may be able to extrapolate these out) it is however, very easy to see that by implementing such a simple “tool” or “item” to their website/company there would be many benefits. These include increased customer frequency, increased closed sales, total revenue, increased customer satisfaction and therefore customer retention.
Any tips on pitchig or approaching a company with an idea to improve there business model while protecting my idea?
Luke,
You might be able to get a business method patent. It really depends on what your idea is.
Present the benefits of the idea with a sell sheet and/or video. Make it really clear what the benefits of the idea are in your one page sell sheet and in less than one minute for your video.
Andrew Krauss
inventRight Co-Founder
Hello Stephen, Andrew and Tim!
What timing that I discover this post and the work you do! I have only very recently been discussing an idea of mine with a large food manufacturer. I happen o know someone in a high position within the company and so had easy access to getting the idea to the right people. After many months it was decided that they didnt want to go down the route my product would take them and so it was suggested that I approach similar companies. Now im on my own and I am looking for some help…! Where do I go for advice? Can you suggest any resources to help me? Regards, John
John,
There is some great free advice on our website http://www.inventRight.com . We have a free radio show and interviews with past students that have licensed ideas.
You will also find links to our book “One Simple Idea” on our web site that would be a great help to you.
We also provide coaching.
Keep Inventing,
Andrew Krauss
Co-founded inventRight.com with Stephen Key 10 years ago to coach and mentor inventors through the licensing process