How to Rent Your Ideas to Fortune 500 Companies: Part II (Plus: Hacking Japan Tips) 199 Comments

Written by Topics: Filling the Void


This bear scared me when I was little, but it made $1,000,000 per month in royalties for the inventor. Stephen worked on it.

This is a continuation of my previous Q&A with Stephen Key, who has licensed to companies ranging from Coca-Cola and Disney to Nestle. He was also involved with the design of both Teddy Ruxpin and Lazer Tag. This second and final part will cover royalty rates, negotiation, and how he calls into companies to sell his concepts (including actual call scripts).

Before we get started, here are a few other resources that I have in my licensing and product design library, which really focuses on deal making and arranging revenue splits:

Inventing Small Products (Stanley Mason, like Stephen, is a specialist at tweaking/combining existing products as a lucrative shortcut to successful deals)
Secrets from an Inventor’s Notebook (Maurice Kanbar, creator of Skyy Vodka, among many others)
How to License Your Million-Dollar Idea
The Inventor’s Bible: How to Market and License Your Brilliant Ideas (stick to the licensing recommendations)

Now, back to Stephen and his approach:

-How much money does it take to license your idea? How much time does it take?

In review, I spend $100 on a provisional patent application so I can legitimately claim “patent pending” status for a full year, $80 or less on a sell sheet that I have created by a graphic design college student. My third cost is the cost of making phone calls to manufacturers. So for many simple products your total costs are $200 to see if your idea has legs. Of course there are always exceptions. Some products will cost more, but you’d be surprised at how little you can spend to be “pitch ready.”

Sample Sell Sheet
mukkk1.jpg

-What is a typical royalty rate?

Royalty rates can range from .0001% to 25%. Royalties are usually based on the wholesale price. This is the price the manufacturer sells to the retailers for, or that they sell to a distributor for.

A very general rough way of figuring out the wholesale price of an item is to just cut the retail price in half. This doesn’t work for all industries or product categories, but it’s a nice way to get a rough estimate of what your royalty might be for your idea.

If you think your product is going to sell for $10 at a retail store. You half that, to get a wholesale price $5. Your royalty would be on this $5 wholesale price.

So why would you ever want a .0001% royalty rate? Well if your invention went of every bottle of Coca-Cola that sold worldwide. That might not be a bad royalty rate. Or if you had a software product that only aardvark researchers bought, 25% might be very fair, since the manufacturer isn’t going to sell many units.

In my experience a 5% royalty is most common for consumer goods. I usually ask for 7% and settle on 5%.

I’ve licensed many novelty products that have sold in stores for one or two years and then never sold again. That can be fun, and I wouldn’t discourage people from licensing novelties, but that’s not where I made my millions. I’ve made serious money by selling ideas that I knew could sell 100,000’s or millions of unit every year.

My advice is to pick a product area that does high unit volume. This way that 5% of the wholesale price on every unit can really add up.

To further illustrate my point, I’ll tell you a little story. I had a student that had already filed a patent when he came to us. My approach, as you know, is to use provisional patents that only cost $100, so you don’t need to spend a bunch of money in advance of selling the idea.

It was to late for this particular student. He’d already spent about $6,000 on a patent. His invention was a drum key that made tightening the thumbscrews on a drum easy, so drummers don’t have to hurt their thumbs to get their drums tuned up.

Drummers loved it. He took our inventRight course and licensed his idea to a musical instruments manufacturer. The manufacturer was already selling another drum key and gave him an idea of how many of his drum keys they thought they would sell each year.

So he did the numbers, then realized that it would take a year just to earn back in royalties what he had spent on the patent. It was a low volume product. The lesson – pick high volume products and you’ll make much, much more money.

Six thousand a year in royalties just isn’t worth the time for me. It takes almost the same amount of energy to license a small idea as it does a big one, so why not go for the big one?

In my prior life, I worked as a product designer at Worlds Of Wonder (a now defunct toy company). I watched the inventor of Teddy Ruxpin, the talking teddy bear popular back in the late 80’s, make $1,000,000 in royalties a month!

I know that’s a long winded response to your questions about what a typical royalty rate is, but I wanted to give your readers some solid advice and examples that they can take and use when licensing their ideas.

-What should people consider when working on their first idea?

Most inventions are just slight variations of existing ideas. I’ve found it easier to sell ideas that aren’t too radically different. The easier it is for people to understand the idea, the better.

I prefer simple ideas, but I’ve worked on a few tough ones also. My Michael Jordan wall ball was super simple [a basketball hoop attached to a cut out of Michael Jordan, all of which was attached to a door]. I licensed the idea almost overnight and received royalties for ten years. It was a great product for me to start off with because it was so simple, required very little research and the manufacturing was easy. My spin label invention is much more complicated and after many years and millions of labels, I’m still working on getting it to where I want it to be.

My best advice is to make your first idea a simple one, so you can go through the whole process of selling an idea. Then work on the harder ones after you’ve gotten a little experience under your belt.

-Who do you call at companies when you try to license a new idea?

Sales guys are great, but my first choice is the marketing manager of a product line at the company that would easily understand your invention. Avoid purchasing. [Note from Tim: Find the manufacturers' names by browsing the relevant categories in a department store, or online at a place like Amazon.]

For example, if you have a new comfortable grip hammer innovation, call and ask for the “marketing manager of the easy comfort grip hammer line” at Stanley. Use the product line name when you call. It’ll sound like you know exactly whom you are calling for. I think you get the idea. This is just one of many tricks I use to get into the decision makers at companies. If this doesn’t work, there are many other tricks you can use to get your idea in front of a decision maker.

[NOTE: For real scripts that Stephen has used in calling into companies, click here to download a PDF]

-What kinds of products can someone license?

You can license almost anything. You just need a new product benefit and some IP (Patent, Copyright or Trademark). In some industries like the toy industry, you don’t even need any IP.

However, I wouldn’t recommend licensing toys. It’s too competitive. You might have to show 200 ideas before you get interest in even one. I don’t like those numbers.

I prefer to sell ideas to industries that don’t see so many new ideas each year. I’m talking about industries that don’t currently have many innovative new products. The packaging industry is one of these industries.

I licensed my spin label invention to a packaging company. They thought I was a genius. I’m not a genius. I’m just more creative than they are, and they don’t see many new ideas.

I guess my little secret tip for you to contemplate is to consider coming up with new ideas in industries that may be a little stale. You won’t have much competition and they’ll think you are brilliant. [Note from Tim: a good method for examining industries is to browse categories or departments in a store like Wal-Mart and look for products that haven't changed in a long time, or those where most products are nearly identical. Can you reinvigorate a commodity with a small tweak?]

-Do you have any words of advice regarding negotiating for those new to licensing ideas?

The ability to hold back information and dole it out in small intriguing bits and pieces is a critical part of my approach. It works almost every time. And more importantly, it keeps the dialog going. Once the dialog stops, the deal slows down and fizzles out.

If you keep the dialog going with a manufacturer, you’re more likely to close the deal. So don’t give them all the information up front. The manufacturer has no reason to call you back if you give them everything up front.

This is one of the biggest mistakes I see inventors make. They give up to much to soon and don’t know how to keep a dialog going with a manufacturer. [Tim's note: Don't oversell. This is as true for PR as it is for licensing -- the goal isn't to sell in one call, it's to get a second conversation or spark questions that lead towards a deal.]

###

Odds and Ends: Hacking Japan and Living Like a Rockstar in Tokyo

A number of you have asked me to do a “How to Live Like a Rockstar in Tokyo” post like the how-to article I wrote for living large on little in Buenos Aires. Now you can get some of my top picks and tricks for Tokyo. I have a series of sidebars called “Tokyo Tips” in the debut issue of Everywhere magazine, which is out now. It’s a gorgeous magazine and one of the best I’ve seen in the travel genre. It should be available starting today in most bookstores.

Posted on November 27th, 2007

Leave a Comment or Question

Comment Rules: Remember what Fonzie was like? Cool. That’s how we’re gonna be — cool. Critical is fine, but if you’re rude, we’ll delete your stuff. Please do not put your URL in the comment text and please use your PERSONAL name or initials and not your business name, as the latter comes off like spam. Have fun and thanks for adding to the conversation! (Thanks to Brian Oberkirch for the inspiration)




199 Comments

  • Erik Cox — November 27th, 2007, 10:33 am

    Hi Tim,
    lots of good advice these last two posts, still trying to absorb it all. Also looking forward to your Tokyo article, I’ll go look for it today.

    Later,
    Erik

    Reply

  • Pete — November 27th, 2007, 11:43 am

    Another thought/question…how does licensing an idea to a co. relate to just contacting their customer support and offering a suggestion? Granted, my mindset is more in terms of software or maybe even technology hardware. But if something doesn’t do what I want it to, I think I’d be more apt to contact the company and offer the suggestion rather than patent the idea and sell it to them.

    Maybe I’m just not cutthroat enough. I’m still very much intrigued all the same, and will be putting my thinking cap on soon to see what I come up with.

    Reply

  • Stephen Key — November 27th, 2007, 12:17 pm

    Pete Wrote. . .

    “Another thought/question…how does licensing an idea to a co. relate to just contacting their customer support and offering a suggestion? Granted, my mindset is more in terms of software or maybe even technology hardware. But if something doesn’t do what I want it to, I think I’d be more apt to contact the company and offer the suggestion rather than patent the idea and sell it to them.

    Maybe I’m just not cutthroat enough. I’m still very much intrigued all the same, and will be putting my thinking cap on soon to see what I come up with.”

    REPLY FROM STEPHEN KEY

    Hello Pete,

    If you really like a company and it’s products, i could see calling in and suggesting a new feature for a product. But will anyone ever even look at your idea? Probably not.

    Submitting ideas through formal channels on a companies web site or over the phone to customer service will most likley go into a black hole. I’m speaking from my experience and the feedback I get from my student.

    Doing what I suggest in this blog post and getting in the back door with the right marketing manager or sales guy will be 1,000 times more effective.

    If you put the time in to contact the company, you deserve to get paid in my opinion. I teach my students how to set up the deal so you make sure you get paid for your new product ideas.

    It can be done with very little money invested in a provisional patent application, a sell sheet and the cost of your phone calls.

    Kindest Regards,
    Stephen Key
    inventRight.com

    Reply

  • RM — November 27th, 2007, 1:11 pm

    Thanks for the great interview. Before trying to rent your idea, is it advisable to first set up an LLC/corp to protect yourself? What happens if you somehow end up licensing an idea for a product that then (directly or indirectly) results in an injury or harm at a later time? Could you potentially be liable for that? Sorry if this is a dumb question and thanks in advance!

    Reply

  • John — November 27th, 2007, 1:23 pm

    Very informative.

    Reply

  • David — November 27th, 2007, 1:50 pm

    This is great stuff. I love the emphasis on minimizing startup costs. Very high upside, with almost no downside to this approach.

    Reply

  • Victory Darwin — November 27th, 2007, 1:56 pm

    Hey Pete… when you make your suggestion to customer service it goes on a slip of paper that nobody reads.

    when you make it to the right person, combined with your teaser sales pitch, you may see your improvement actually happen

    …and get paid!

    I think you’ve made a great point, it could be the very same idea, but it must be presented right and go to the right person. Nothing cutthroat about that.

    ~V

    Reply

  • Victory Darwin — November 27th, 2007, 2:03 pm

    Hey Tim, I’m negotiating to become a distributor of the Invent-Right program, so don’t worry about the FERRISS50 coupon code…

    I will offer my own discount to the loyal fans of 4HWW!

    I spoke with Andrew Krauss, the co-founder of Invent-Right and was amazed to find out that their $400 DVD program actually comes with 1 year of follow up support, where you can call in and Andrew or Stephen themselves will answer your question.

    This really is the ultimate 4HWW plan for inventors and idea guys.

    ~V

    Reply

  • Scott G. F. — November 27th, 2007, 2:44 pm

    So you go to a company with this idea that you put in a PPA. What would cause them to wait a year for the PPA to expire and then produce your idea cutting you out?

    What about overseas protection?

    Reply

  • Stephen Key — November 27th, 2007, 3:20 pm

    Scott G. F. Wrote. . .

    So you go to a company with this idea that you put in a PPA. What would cause them to wait a year for the PPA to expire and then produce your idea cutting you out?

    What about overseas protection?

    REPLY BY STEPHEN KEY

    Hello Scott,

    I get this question often. You don’t call just one company, you call five or eight or maybe even 10 or more companies.

    A year is plenty of time to see if an idea has legs if you start making calls the second you file your provisional. So don’t sit around feeling all warm and fuzzy that you can say patent pending. Start making calls ASAP after you’ve filled your PPA.

    Here’s a little trick. Subtly let the companies know that you have filled additional provisionals. They won’t know what is in them and they just might think you’ve made even more improvements.

    I won’t get into overseas protection in this comment. There are so many things to cover there. Maybe Tim can interview me about International patents for a future blog post.

    BTW- I’ve just started blogging on the mega business site http://www.AllBusiness.com . You can check out my new blog by visiting http://www.allbusiness.com/4969065.html

    Kindest Regards,
    Stephen Key
    inventRight.com

    Reply

  • Jim — November 27th, 2007, 3:44 pm

    Scott:

    I would assume, since you would then be shopping the idea to their competitors, they would not be able to wait you out if the idea has merit (i.e. a competitor could buy the idea and help you get the patent to cut out the company trying to wait your PPA out). I have no experience in the area, but that’s my guess.

    Jim

    Reply

  • Jose Castro — November 27th, 2007, 5:05 pm

    Great Question Scott,

    I have the same question. This is really something new to hit my brain. Almost an alternative to owning a company. I like this article and really want to thank Tim for his contribution to making society a more fun and enjoyable place to experience. He is by far one of the newest humanitarians. I would even go as far to say he is the next Bono. Look forward to the responses.

    Best

    Jose Castro

    Reply

  • zach even - esh — November 27th, 2007, 11:07 pm

    Tim – thanks for yesterday’s reply! I imagine your gym woulda been pretty bad ass! I think licensing my gym might be sorta as mentioned here, not enough profit, although I’ve seen a few guys do it, I don’t think they’re putting their kids through college on it.

    talk soon bruddah,

    lata!

    –z–

    Reply

  • Azzam — November 28th, 2007, 8:32 am

    We tried to promote a popular product (already developed and patented) in the US to the market in the UK. Although everyone found the product fascinating, innovative and useful. The hierarchy of approval was too lengthy! At times we would bounce emails and calls to whom would sound like the right person and then you get reshuffled to someone else. Now this may not be the case if the maximum exertion to develop and produce a product/item/implement solution is on the shoulders of the actual company pitched.

    Reply

  • Azzam — November 28th, 2007, 8:37 am

    The cold calling seems too simple :P

    But saying that I did actually come up with a brilliant idea to prevent Credit Card fraud and called it the CreditCard Firewall. I did get response from the right people but was looking at the angle of development throughout. Come to think of it, on several occasions I did this; it maybe time to pitch as an idea instead of as a product ?? So are you available for email or telephone discussion for a brief chat Steven? I think I missed the tele-seminar or we do not cross times as I am in the UK

    Reply

  • Scott G. F. — November 28th, 2007, 11:15 am

    Stephen,
    Thank you for the time you took to reply to my query. I already hold one patent 7080668 and have 5 others in the cue but it’s for the Co. I work for and I don’t realize the benefit.

    I do have ideas that do not apply to what I am working on and will try and use what you have suggested to see if I can do this.

    Thanks again.

    Reply

  • David — November 29th, 2007, 4:36 pm

    Hello
    I’m the founder of an online shop, and a reader of your book.
    I always have hundreds of ideas to invent and build stuff and it could be an option for me to patent/license those inventions. But I’m not sure if in France (where I am) it’s enough to show a sale sheet to patent an invention.
    Also if I have someone interested they’d like to see a prototype, how will you make it?

    Reply

    • Leah Q. — December 3rd, 2012, 11:21 pm

      Hi Andrew &Stephen,
      Thank you for all the help you’ve shared to inventors & product developers.For a while I felt so lost when I started my invention ,I did a lot of research but looking back I wish I could have been one of your student then my stress could have not been so overwhelming to me. Reading through your advices, I think I did not do bad. I have a utility patent pending on a medical device ( Class 1) I listed it with FDA , sampled them to hospitals , sold quite a few but since marketing seemed to be a struggle in the process . ,I have decided to submit it for licensing with positive response from a medical company . The IP market is vast ( US/WW ) . I wonder during the negotiation process if the licensee determines the figure first , I mean . The upfront & royalty. Kindly advice me in this aspect. Thank you . Best Regards.

      Reply

  • Matt — November 30th, 2007, 2:07 pm

    # RM Says:
    November 27th, 2007 at 1:11 pm

    Thanks for the great interview. Before trying to rent your idea, is it advisable to first set up an LLC/corp to protect yourself? What happens if you somehow end up licensing an idea for a product that then (directly or indirectly) results in an injury or harm at a later time? Could you potentially be liable for that? Sorry if this is a dumb question and thanks in advance!

    ——————–

    I’m actually interested in this as well. Anyone have any comments regarding the above?

    Tim & Stephen, great job. I’d love to see this series continue. Thanks!

    Reply

  • Phil B — December 1st, 2007, 3:40 pm

    Hey Tim,

    It seems that patent research is an elusive aspect of the inventing process that is also key to being successful with inventions. I don’t know how much experience you’ve had in this department, but you usually seem to have some website or trick up your sleeve – any tips regarding patents and patent research for newcomers to the licensing / inventing industry?

    Thanks!
    Phil

    Reply

  • Stephen Key — December 3rd, 2007, 10:51 am

    Azzam wrote. . .
    The cold calling seems too simple :P

    But saying that I did actually come up with a brilliant idea to prevent Credit Card fraud and called it the CreditCard Firewall. I did get response from the right people but was looking at the angle of development throughout. Come to think of it, on several occasions I did this; it maybe time to pitch as an idea instead of as a product ?? So are you available for email or telephone discussion for a brief chat Steven? I think I missed the tele-seminar or we do not cross times as I am in the UK

    STEPHEN KEY’S REPLY

    Yes, Azzam. I’m very reachable.

    Feel free to call me at 1-800-701-7993.

    Kindest Regards,
    Stephen Key
    http://www.inventRight.com

    Reply

  • Stephen Key — December 3rd, 2007, 11:06 am

    RM Wrote. . .
    November 27th, 2007 at 1:11 pm

    Thanks for the great interview. Before trying to rent your idea, is it advisable to first set up an LLC/corp to protect yourself? What happens if you somehow end up licensing an idea for a product that then (directly or indirectly) results in an injury or harm at a later time? Could you potentially be liable for that? Sorry if this is a dumb question and thanks in advance!

    ——————–

    I’m actually interested in this as well. Anyone have any comments regarding the above?

    Tim & Stephen, great job. I’d love to see this series continue. Thanks!

    STEPHEN KEY’S REPLY

    Hello RM,

    First off, I’m not an attorney and can’t offer you legal advice. I can only tell you what I do and what my experiences are.

    I have set up my company as an LLC and as everyone knows it does provide you with more legal insulation than a sole proprietorship or partnership.

    If i were starting from scratch with no money and I was new to licensning, would i run out and file an LLC before making some phone calls to sell my ideas?

    Heck no. It would be just one more thing on my “TO DO LIST” that would slow me down.

    Do i really need to worry about some consumer suing me for a product i licensed to a big corporation? Think about this. Who do people usually sue. The corporation manufacturing and marketing the product or the little inventor that licensed it to the corporation?

    With that said, you can get additional product liability insurance when you license a product. Heck, you can get insurance on almost anything.

    If you’re really determined to protect your millions. One thing you could do is just file an LLC a week or two before it looks like you are going to close your first licensing deal.

    I wish you much success in all your invention related endeavors.

    Kindest Regards,
    Stephen Key
    http://www.inventRight.com

    Reply

  • Stephen Key — December 3rd, 2007, 11:09 am

    Scott Wrote. . .
    Stephen,
    Thank you for the time you took to reply to my query. I already hold one patent 7080668 and have 5 others in the cue but it’s for the Co. I work for and I don’t realize the benefit.

    I do have ideas that do not apply to what I am working on and will try and use what you have suggested to see if I can do this.

    Thanks again.

    STEPHEN KEY’S REPLY

    Good luck Scott! Call me at 1-800-701-7993 if you ever have a question.

    I wish you much success in all your invention related endeavors.

    Kindest Regards,
    Stephen Key
    http://www.inventRight.com

    Reply

  • Cameron — December 3rd, 2007, 10:01 pm

    Stephen:
    I see you have done some work with WalMart in the past. I have an idea, but no one really seems to know how the marketing director even is. Also, my idea isn’t so much an idea that is a different way of doing things in their store. Since I’m not creating something, what licensing would address this issue?
    Thank you for your time sir.
    Cameron Benz

    Reply

  • Cameron — December 3rd, 2007, 10:27 pm

    should have said who* the marketing director is.

    Reply

  • Ryan — December 7th, 2007, 2:55 am

    Hi Tim,
    First things first, I love your book!
    Okay, I have an idea to bring the trend of designer apparel(fashion forward messenger bags, track jackets, etc) into a different industry. I know the styles I want to emulate but one problem… I’M NOT A DESIGNER! Would you reccommend I spend money on hiring an apparel designer to get sketches and specs? I’ve found none on elance and one on craigslist but am waiting on pricing.

    I talked to the buyer for a nationwide company who’s shown interest but needs pictures of the product to see if they’ll buy. It would be a HUGE account. I’ve already found a manufacturer who will send samples, but they need specs.

    I’m really amped on this idea and have no clue why it hasn’t been done but need some direction!

    Very Best Regards,
    Ryan

    Reply

  • Stephen Key — December 10th, 2007, 3:02 pm

    Ryan wrote. . .
    Hi Tim,
    First things first, I love your book!
    Okay, I have an idea to bring the trend of designer apparel(fashion forward messenger bags, track jackets, etc) into a different industry. I know the styles I want to emulate but one problem… I’M NOT A DESIGNER! Would you reccommend I spend money on hiring an apparel designer to get sketches and specs? I’ve found none on elance and one on craigslist but am waiting on pricing.

    I talked to the buyer for a nationwide company who’s shown interest but needs pictures of the product to see if they’ll buy. It would be a HUGE account. I’ve already found a manufacturer who will send samples, but they need specs.

    I’m really amped on this idea and have no clue why it hasn’t been done but need some direction!

    Very Best Regards,
    Ryan

    RESPONSE FROM STEPHEN KEY

    Hello Ryan,

    You are getting off to a great start. Taking a concept from one market and applying it to another is a great approach.

    Maybe you could try hiring a very capable fashion student at a local college. Call a professor and ask who their best fashion design students are and if they would like some extra work and an opportunity to build their portfolio. This will save you thousands!

    I wish you much success in all your invention related endeavors.

    Kindest Regards,
    Stephen Key
    inventRight.com

    Reply

  • Jennifer Mannion — December 11th, 2007, 3:56 pm

    Hi Tim & Stephen, Thanks for this series as an inventor this was interesting to me. I’ve done some things “wrong” according to this “given up too much info — too fast” and some things according to this like getting the provisional and NOT the patent quite yet and talking to the right people within companies. I do have a new product (cordless hair dryer) and while there are patents for this – none are like mine and none that I know of have a working prototype (I do). I’ve been told by BIG corps that any of their models are at least 2 years from being out here with their technology and mine has been working for me for over a year. The issue? Since it is so new I have been told while my next remake of the prototype needn’t have all the bells and whistles it SHOULD be changed significantly and be able to prove its power and that the changes I made are all functional. I’ve invested time, money, energy and am ready to sell this — give all my ideas for the new version (have had it researched) and move on. I LOVE this product — I want every household to have one but honestly my life has taken on a very different route from when I started. Do I spend the money to make my new prototype? DO I get the next virtual rendering done and make an advertising page like you suggested? What is the quickest way to “be done with this” license it for a royalty schedule and move on?

    I am now concentrating on helping people better their health by natural means. I have healed myself of several chronic illnesses and pain by studying the mind/body connection. I feel this is very important and maintain a blog on it. I know the invention would give me the resources to reach out to more people….. Any advice you can give me would be GREATLY appreciated! Thank you! BTW Tim — I have been referred to your blog about 10 times in the last 2 weeks by friends and LOVE it — thank you for your great content. Gratefully, Jenny

    Reply

  • Stephen Key — December 12th, 2007, 1:18 pm

    Cameron Wrote. . .
    I see you have done some work with WalMart in the past. I have an idea, but no one really seems to know who the marketing director even is. Also, my idea isn’t so much an idea that is a different way of doing things in their store. Since I’m not creating something, what licensing would address this issue?
    Thank you for your time sir.
    Cameron Benz

    Hello Cameron,

    Thanks for the questions.

    First off. Make sure you can make money with the idea. If you have an idea for their store, how many would you sell.

    If you got a 6% royalty on the wholesale value. How many would Wal-Mart use. How many stores do they have. Would you be happy with that amount of money for your efforts?

    You see, you need to license products that do large numbers to make money.

    Hope this helps .

    I wish you much success.

    Kindest Regards,
    Stephen Key
    inventRight.com

    Reply

  • Eric Dick — December 13th, 2007, 11:24 am

    Hi People,

    From my experience the home business industry is a great way to tap into a proven system and begin marketing. Be weary of the “automated systems” you will have to funnel lots people into these systems, so just b/c you dont have to talk to people, there are other big hurdles. People will never buy big ticket items with out some level of training and mentorship. The business I found allows me to earn a maximum of $14k per customer, and yes it is not uncommon for them to purchase all of my products at once. While there is a benefit to doing small testing, in the end there may not be a big pay off, and that time and energy could be better harnessed using an already existing model, that has big payouts. I am glad I did what I did, because my ideas are too niche and not mainstream enough. The best thing I could think of is an e-book on how to be a club DJ, but why market to an audience that loves pirating copyrighted material.

    Just my thoughts, Thanks Tim!

    Eric Dick

    Reply

  • greg — January 2nd, 2008, 4:41 am

    Hi Stephen,

    Don’t some (many?) companies just take your idea and run with it, expecting that you won’t have the resources to go after them?

    Reply

  • Rachel — January 3rd, 2008, 6:50 pm

    I have an idea for a series of childrens books that fit perfectly into the new “yoga” mommy, Baby Einstein mindset of educating small children. Being a young mother myself I have had plenty of opportunities to test the idea on other mother’s and children and they all love it. My question is because it’s a series of books should I try to start a small publishing company myself or is it possible to license the idea to a company. Is it even possible to license a book idea or is it harder because its not a typical invention?
    Thanks a lot.

    Reply

  • Terry Ashton — January 13th, 2008, 12:46 pm

    Hi

    I stumbled across this site last week and congratulate you on some very interesting articles.

    But I have a specific question. I have been thinking laterally and dreaming up ideas/fixes/solution etc to the point of severe frustration. In the 80′s I was in the computer games biz so have quite a bit of experience in licencing and in the 90′s I took out patents so I understand that side too.

    My question is: Not every idea is patentable. Nor can it have a registered design or copyright attached to it. So how does one approach a company (a potential licensor) with an idea that cant be protected, and how do you avoid being ‘ripped off’ by the company just ‘taking’ the idea.

    I would add I have done many many ‘confidientiality agreements’ etc etc but in reality any company with a half decent lawyer would have no problem circumventing these.

    So do you have a ‘simple’ flowchart for how each idea is ‘licensed’ dependant upon its level, if any, of protection

    Thanks

    Terry

    Reply

  • John — January 13th, 2008, 8:16 pm

    Hey Tim and gang!
    Quite a culture that has developed here based off the book! I love it! The book certainly opened up lots of perspectives on life I had always had in my head but am glad you, Tim, were able to bring it out onto written word. Makes me feel not so alone!
    My question is how do you feel about the network marketing industry? Have any companies approached you in the same respect they approached Robert Kiyosaki and his Rich Dad, Poor Dad? Are there any companies that you’ve had a chance to look over and have caught your eye?
    Thanks much!

    John

    ###

    Hi John,

    I haven’t explored this much and have turned down those that have made proposals thus far. I’m always open to proposals, but I can’t feel good endorsing most products I’ve had come my way.

    Hope that helps,

    Tim

    Reply

  • Leo — January 14th, 2008, 9:03 am

    Great, very informative site !!!

    I have a couple of questions to present to the table. One is what TERRY ASHTON posted, so can anyone answer those question presented by ASHTON.

    What if your idea is in a field that would take years of schooling, to actually come up with a prototype to sell. For example, LCD flat screen TV’s , I and I’m sure many, many others had this idea but how many of us can actually build a TV. How can an idealist sell a idea , like LCD TV’s but has no clue and would take years to get a clue about the product design, get a license ?

    Also, what if your idea doesn’t fall under ” improving on an existing invention ” ? What if your idea , is something that, if you worked for the company would get you a promotion but it’s nothing new, just hasn’t been done before ? For example (not my idea ), the person who had the idea to put team logos on towels probadly worked for the company not a Licensor . Or what if it’s just a remake, like bring back clear jelly sandals ? Can these ideas be licensed ?

    Can someone please answer these questions ? These question seem to never get answered in any forum ? Please help !! Thanks in advance for any response !!

    Reply

  • JEFF PLASTER — April 6th, 2008, 12:36 am

    Hey Tim.
    My question is this, what if I have some great ideas involving the automotive and construction feilds, but dont want the hassle of trying to sell them. Is it possible to get a more qualified individual to look at my ideas and drawings and sell them for say half the profits (if any)?

    Reply

  • Stephen Key — April 7th, 2008, 2:44 pm

    Hello Jeff,

    RE: your question

    Your idea is about 5%, protection(Patent,copyrights and trademarks) is about 5% and the remaining 90% is selling the idea. The more qualified individual that should review your idea is the manufacturers you are selling to. Manufacturers that have been in the business 10, 20 or 30 years are the best people to get advise from. Advise or opinions from people or companies that aren’t being asked to put up money are questionable at best.

    Keep Inventing,
    Stephen Key

    Reply

  • KC — April 9th, 2008, 5:24 pm

    Stephen-

    Just came up with an idea to exploit a product that is not really advertised and would be a no-risk proposition to companies that I’m targeting, especially since there wouldn’t be anything new to create or manufacture besides labeling for the product. It’s not private labeling, just a different way for the company or manufacturer to market the product. I would like to refine my sales and communicating skills before I start contacting the manufacturers and would be interested in your DVD’s, but I’m deaf, so they wouldn’t be much use. However, I’m still very interested in learning from your experiences and would be interested in any other offers you may have besides the DVD’s that would be of use for me. Thanks.

    -KC

    Reply

  • Stephen Key — April 10th, 2008, 11:18 am

    KC WROTE
    Just came up with an idea to exploit a product that is not really advertised and would be a no-risk proposition to companies that I’m targeting, especially since there wouldn’t be anything new to create or manufacture besides labeling for the product. It’s not private labeling, just a different way for the company or manufacturer to market the product. I would like to refine my sales and communicating skills before I start contacting the manufacturers and would be interested in your DVD’s, but I’m deaf, so they wouldn’t be much use. However, I’m still very interested in learning from your experiences and would be interested in any other offers you may have besides the DVD’s that would be of use for me. Thanks. -KC

    REPLY

    KC,
    Sounds like you may have something. You need to figure out what it is your getting IP(patent protection) on though. You might be able to protect your idea with a business method patent? However, business method patents can be a bit more tricky than a regular patent. I’ve done quite well with my SpinLabel invention. My spin label was not a new product but packaging that helped market the product it was on. I patented the method of applying my new label innovation to containers. So what I’m saying is that you need to think through what it is your protecting.

    With regards to my inventRight course, the course comes with an over 200 page workbook, so you don’t have to listen to the CD’s. Unlimited phone support is also included with our course, but using phone support may be difficult or expensive if you need an interpreter. I’d be happy to communicate with you via email instead if you decided to buy the course.

    Keep Inventing,
    Stephen Key
    inventRight

    Reply

  • David Ellis — August 21st, 2008, 5:36 pm

    Stephen,

    I am preparing to license my new product logo to a certain industry.
    I Love the idea about you using a provisional patent.
    Is there any way to do the same with a trademark?
    I have already filed for a TM, but if there is provisional trademark or something similar I will us it next time.

    David E.

    Reply

  • Stephen Key — August 22nd, 2008, 8:12 am

    I won’t go into detail since I’m not an attorney, but using “TM” is a trademark and it’s FREE. You just put it next to your mark and it costs you nothing.

    If you pay and file for a trademark with the United States Patent Office, you would use “R” which means it’s a registered trademark.

    Reply

  • Pete — September 23rd, 2008, 7:01 am

    I was just thinking about this thread recently as some things have been going on. What are some things to think about (or is it even possible?), to license a product or idea to your own employer?

    I work for a company that provides an Internet-based service (actually, the company I worked for was acquired, so now I work for megacorp). There is one aspect of our business niche that isn’t being met, and corporate has been lukewarm to pursuing it.

    I’m not happy with their business direction in general and their basically killing our (better) product, but I’m wondering if I were to put together a product on the side that met this niche, what I could do with it. I’m pretty sure their crappy non-compete would keep me from running it myself, so the thought of licensing it to them came up. Or releasing it into the wild as open source….but again I don’t know how much teeth the noncompete actually has. Any thoughts?

    Reply

  • Brian Marks — October 10th, 2008, 3:47 pm

    Stephen,

    I have been told by two different patent attorneys that a provisional patent will not give me enough protection to go public with my invention. I want to make sure that I will be covered when presenting my product to different companies. You mention that you have used many PPA in the past; have you ever had any problems with the security of your ideas. I have everything in place but am still wary of what type of patent I need to feel secure. I have so many inventions in the works and need to know my ideas will be safe.
    I have thought about starting a company with my partner Ryan Chester but dont have the money to get started. If our invention would interest investors where could we find that type of business invenstor that works with inventions/innovations?

    -your time is appreciated

    Brian Marks

    Reply

  • Stephen Key — October 13th, 2008, 9:17 am

    Brian,

    I would be happy to answer your questions. Let’s answer your first question about money. The nice thing about the way I license is that with a $105 Provisional Patent Application and a sell sheet that I create myself, I can sell my ideas. I have money, but I don’t need it or use it when I license most of my products. You see the manufacturer is going to invest their money in the idea and pay me a royalty. That’s what I love about licensing, you can do it with very little money.

    Regarding Provisional Patent Applications and having enough protection. PPA’s have always worked for me, but realized this . . . Licensing and business in general are not a game for people that want 100% assurance that everything is going to be ok. You need to take risks. I take very little risk “money wise” with most of my ideas. This way if things don’t work out, I can move onto my next idea. But I do take risks. You have to. Licensing is not a job, you aren’t guaranteed a paycheck every Friday. If you are passionate about your idea and want to get them licensed to a big company that can sell more than you ever could, then it’s a great game. I can’t tell you how wonderful it feels when I see one of my products on the store shelf.

    This is not legal advice, please consult a patent attorney if you want a legal opinion.

    Stephen Key

    Reply

  • JEFF — January 20th, 2009, 12:44 pm

    WHEN YOU SAY CALLING DIFFRENT MANUFACTUER DO YOU MEAN A COMPANY WHO MAKES THE PRODUCTS FOR EX: SONY . OR DO YOU MEAN SONY.

    Reply

  • Stephen Key — January 20th, 2009, 2:26 pm

    Jeff,

    You call the manufacturer that sells to a retailer. If you have a new hammer innovation. You call companies that sell hammers and already have distribution at for example. . . Home Depot, Lowes, Wal-Mart ect..

    And yes, sometimes you might license to a sub-contractor that then sells to a big company like Sony.

    Keep Inventing,
    Stephen Key

    Reply

  • Kevin — May 11th, 2009, 1:37 pm

    Is it OK to give the patent # or full details of your product to a large company- even if its on-line for the public from the US patent office?
    I even included in detail of the product is made from start to finish on my patent -pending product when I filed it……

    Reply

  • Stephen Key — October 1st, 2009, 3:53 pm

    Hello Kevin,

    One big advantage when you have a provisional patent or patent pending is that the licensee/manufacturer that your trying to sell you idea to doesn’t know what you have protected or what you haven’t protected. This is a great advantage.

    However if your patent has already issued and you have a patent number, this can be good also. If you have a patent number, that means that you’re patent has issued/been granted. The manufacturer doesn’t need to wonder if you patent will issue with the claims/protection you applied for.

    I would suggest that you not worry about someone seeing your issued patent. Instead, I’d focus on selling the benefits of your idea by using a sell sheet such as the one in this post.

    If you’d like to learn more about sell sheet and selling your invention, I have a free webinar coming up. Just click on the website link in this email to attend.

    Reply

  • Stephen Key — October 1st, 2009, 3:54 pm

    Hello Kevin,

    One big advantage when you have a provisional patent or patent pending is that the licensee/manufacturer that your trying to sell you idea to doesn’t know what you have protected or what you haven’t protected. This is a great advantage.

    However if your patent has already issued and you have a patent number, this can be good also. If you have a patent number, that means that you’re patent has issued/been granted. The manufacturer doesn’t need to wonder if you patent will issue with the claims/protection you applied for.

    I would suggest that you not worry about someone seeing your issued patent. Instead, I’d focus on selling the benefits of your idea by using a sell sheet such as the one in this post.

    If you’d like to learn more about sell sheet and selling your invention, I have a free webinar coming up. Just click on my name next to my picture in this post to attend.

    Reply

  • Stephen Key — October 1st, 2009, 3:56 pm

    Kevin,

    One big advantage when you have a provisional patent or patent pending is that the licensee/manufacturer that your trying to sell you idea to doesn’t know what you have protected or what you haven’t protected. This is a great advantage.

    However if your patent has already issued and you have a patent number, this can be good also. If you have a patent number, that means that you’re patent has issued/been granted. The manufacturer doesn’t need to wonder if you patent will issue with the claims/protection you applied for.

    I would suggest that you not worry about someone seeing your issued patent. Instead, I’d focus on selling the benefits of your idea by using a sell sheet such as the one in this post.

    If you’d like to learn more about sell sheet and selling your invention, I have a free webinar coming up. Just click on my name next to my picture in this post to attend.

    Reply

  • Rachel — December 6th, 2009, 2:08 pm

    Hello Stephen,

    I am really enjoying reading about your techniques for licensing (and Tim’s technique’s for overall life management).

    Just curious…have you adopted any of Tim’s techniques into your own business practices for licensing. If so, how and what exactly?

    For example…
    Can you/Do you outsource “cold calls”?
    Can you outsource the negotiating?
    At what point in the licensing process could you turn it over to someone else?
    What aspects of your methodology can you delegate to others?

    I would love to learn how to focus my time more creating good inventions and not selling/negotiating (Although I know that I must do some of this.).

    Am I dreaming an impossible dream?

    Thanks,
    Rachel

    Reply

  • Mond — December 8th, 2009, 12:04 am

    Dear Stephen,

    I have a few questions regarding the PPA:

    - Would there be a point in filing a PPA for a supplement formulation?
    - If an imitator changes the dosages of my formula slightly, would the PPA protect me?

    Thank you

    Reply

  • Stephen Key — December 8th, 2009, 10:07 am

    Rachel,

    Great questions!

    The biggest benefit of licensing is that once you license your product to a company, they handle everything.

    Here’s a list of just some of the things a manufacturer will take care of after you cut a deal with them.

    * The money (You will risk their money, not yours.)

    * Sales, (You don’t need to do any day to day sales. Their sales force will handle all the sales.)

    * Distribution, (A big mfg will have a HUGE distribution network that they can instantly plug your new product idea into.)

    * Advertising, (they pay not you)

    When you license a product to a company, most of the time you are handing it over to them. They take care of everything and pay you a royalty based on each unit sold.

    You now have the bandwidth to move on and license other products, because you are not spending your time running a company.

    Licensing is the ULTIMATE in outsourcing!

    Of course, you do need to do some initial work of course to make that sale(license) your product idea to the manufacturer. You just don’t need to do the back end work of running the company and that’s a huge plus.

    With regards to outsourcing and cutting this deal. I would give it a shot yourself first before you try to outsource this very important part of the process. It’s really not as hard as you think and no one is going to pitch your idea with more enthusiasm or know it better than you.

    Instead of having to call thousands of people to sell your product, which is what you have to do when you own your own company, you will create a targeted list of eight to twelve manufacturers to license your idea to. When you close this one sale, they will manufacture your product, run the company and pay you a royalty.

    So you only need one sale!

    I would give it a shot yourself before you try to outsource the cold calling and negotiating. It’s hard to manage someone implementing a process when you don’t have first hand experience with the process yourself.

    I’ve made my career licensing new product ideas. It give me the freedom to live my life the way i like without the commitment of running a company.

    Keep Inventing,
    Stephen Key

    Reply

  • Stephen Key — December 8th, 2009, 10:15 am

    Mond,

    I’ve been told that you can’t patent a combination of natural substances. For example a recipe.

    However you might be able to get a patent on a manufacturing technique to make your supplement. Or if your ingredients are not naturally occuring in nature, you might be able to get a patent on the ingredients.

    PPA(Provisional Patents Applications) are great. For $110 you can fish of the pier and see if anyone is interested in your idea. I highly reccomend them!

    Keep in mind that I’m not an attorney and this is not legal advice. Please seek the services of an attorney if you require legal advice.

    Keep Inventing,
    Stephen Key

    Reply

  • Johan Mattson — December 31st, 2009, 4:29 am

    Hello,

    I’m wondering if it’s possible to license a method of doing things, a website concept. I’ve noticed a certain website concept, an entire industry in fact, that hasn’t changed in a long time and I have a way of potentially improving it. Is it possible to license this idea, as it isn’t exactly a product.

    Any thoughts on this?

    Best regards,

    Johan

    Reply

  • Stephen Key — January 12th, 2010, 5:17 pm

    Johan,

    I would learn about business method patents. They’ve come under fire lately in court, but they are still a valid way of protecting a method of doing something.

    One of the most famous business method patents is “Amazon one click” checkout.

    Google it to find out more.

    -Stephen

    Reply

  • Alex — January 22nd, 2010, 2:19 pm

    I’m going to first say that finding this blog was like finding a diamond in the mountain of garbage information that is the internet… great info!

    This is my situation. I have my idea all thought out and all of its benefits written down. I have the sell sheet (I just so happen to be a graphic design student) all done. I have my $100 for the provisional (not submitted yet). My questions; How and when do I get my sell sheet into the hands of the right person at whatever manufacturer I contact? There are about 5 or 6 benefits to my concept… how do I not tell the manufacturer everything about my idea to get that second call but get them hooked enough to call me back?

    Reply

  • Marcel — January 26th, 2010, 1:01 am

    Hello Tim, Stephen,

    If you cannot get any protection for your idea, for example because it is a new service, how do you start discussions with the potential licensee?

    What you want to avoid is a very interested discussion, no revenue for the licensor and a licensee implementing a free of charge idea.

    So what commitment between the parties can be arranged prior any discussion?

    Thanks, Marcel

    Reply

  • Loïc — February 7th, 2010, 12:12 pm

    Hello Stephen and Tim,

    First a big thanks for all your advises (from both of you) it’s exactly what I needed to know !

    Second a question for Stephen, I have an idea about a product for Ikea ( and already have the sell sheet done, I have a master degree in digital arts so it helps me a lot ! ) but in this case they already have a design and product developpement team. So my question is do I have to contact this team or the marketing team to have more chances to succeed?

    Best regards,

    Loïc

    Ps : I’m not from Usa, I’m from Belgium and there is no patent pending here but there is an alternative to protect your ideas. For the person interested in it -from Belgium, Luxemburg and Netherlands- you can find info at this Url http://www.boip.int/fr/ideeen/introduction.html

    Reply

  • Stephen Key — March 16th, 2010, 8:08 am

    Alex,

    Your question is a great one about contacting companies. Pick the one big benefit that sounds intriguing on the phone. When you talk to someone on the phone give them this one sentence benefit statement and ask permission to email your sell sheet.

    On the sell sheet make sure you focus on one big benefit. You can have sub-benefits in bullet points, however make sure to have one big benefit as your emphasis. I know it’s hard, since you want to tell them everything.

    Your sell sheets need to be like a billboard when you are driving down the freeway. You don’t want to throw everything and the kitchen sink in there.

    Good luck and make sure to click on my name in this blog post to get access to more free advice through my internet radio show and blog.

    Reply

  • Stephen Key — March 16th, 2010, 8:11 am

    Marcel,

    Sometimes you can get a business method patent that may cover a service. I suggest you Google “Business Method Patent” to find out more.

    Trade Secrets is another way to protect your an un-patentable idea.

    Reply

  • Stephen Key — March 16th, 2010, 8:14 am

    Loic,

    It’s always best to have more than one potential licensee (manufacturer to sell your idea to).

    If you spend all that time to make your sell sheet and only have one potential company to sell it to, you are reducing your chances of success.

    You need to ask yourself if there are also other companies you could license this same idea to.

    Reply

  • Stephen Key — March 22nd, 2010, 8:13 am

    I made four posts just above one week ago. It looks like they are still awaiting moderation.

    I am the interviewee for this post and just wanted to make sure to get back to everyone.

    Kindest Regards,
    Stephen Key

    Reply

  • Joann — April 14th, 2010, 9:38 pm

    My idea is in the medical field. I don’t know who’s who. How would I find out what companies would be the best to call.
    Thanks

    Reply

  • Stephen Key — April 15th, 2010, 3:56 pm

    Hello Joann,

    First, you need to make your list of companies that are a good match. They should be producing products in the category of your idea and equally important, they should already have distribution in the stores you want your idea to end up in. Don’t bother with companies that don’t have the distribution you need. If you license you idea to a big company, you will get much larger royalty checks.

    Your product is a medical product, so it may not be found in a store. Maybe a catalog or medical supply house. Of course it depends on they type of medical product you have. You need to figure out where an idea like yours would sell.

    Then you need to know who to call in the companies. My business partner Andrew Krauss and I talk about these issues all the time on our free inventRight radio show. You can take a listen here if you like.

    http://www.inventright.com/inventright_invention_radio.shtml

    Keep Inventing,
    Stephen Key

    Reply

  • Siva — May 31st, 2010, 11:56 am

    Hi Mr. Stephen

    Good to see this article is still being answered even after 2.5 years since it was originally written. I appreciate your work and writing about inventions. I have over 30+ ideas that I have been writing in my inventions notepad. Alas I have not acted on them on time and I already have seen some of them have been brought to market by others.

    I have right now 3 ideas that are not out there as I checked them on the store shelves and talked to the store assistants. I would like to know where do I start. Is there a way someone will show my the way – holding my hands in every step.

    Any help is appreciated.

    Thanks and regards
    Siva

    Reply

  • Tyrone — June 14th, 2010, 9:24 pm

    Hi, Mr. Stephen Key

    I’m on my way on calling company now,I filed a PPA a few weeks ago and I also have a virtual website of my product and I’m using my website as a Sell Sheet.. So i was wondering Mr. Key, is it important for me to have companies to sign a Confidentiality Agreement before I invite them to the website. And if so where or how can i draw (format) an Agreement form up?

    Please help:::: I’m not 1 of your student but I feel like one, I’ve been following you and Andrew for months now on inventright wedinar, radio station, twitter and I THANK YOU both for all your experience and knowledge you two shared with the world………THX AGAIN!!!!

    Reply

  • Ken — June 28th, 2010, 10:19 pm

    Hello Stephen & Tim,

    Thank you Tim for giving me back my life, allowing me to be so much more “present” with my family, and impact the world community with profound good. Thanks Stephen for being responsive to so many questions, and doing so with such keen insights that you could so easily reserve for fees. Just one more reason why I’ve been such an evangelist of your book Tim (lost track of how many copies I’ve gotten sold), and have referred many to your site as well Stephen. I will give you both the most “over the top” plug ever seen on TV when I’m being interviewed on Oprah’s couch this time next year– seriously. Remember and store this blog entry!

    My questions are burning a hole in my pocket: (1) How and to whom do I rent a profound idea for a social networking site where the revenue will be from the advertisers it’s sure to attract? Most of the coverage I’ve seen so far has been on answering questions about products to be sold through traditional distribution channels and receiving a % thereof in royalties. I am seeking to sell a well-developed concept and receive residuals from the ads revenue that said very lucky company/investor is guaranteed to generate a ton of. Do you have insights that you can share here or offline (via my email) on how to structure a deal around intangible ideas that have huge upsides to the potential licensee? (2) Do you ever partner with people to pitch an idea for a % of the profits? (3) Are there ways to rent an idea to multiple licensees? If it’s been done, are there any rules I should consider? Following your advice, and Tim’s citing of Parkinson’s Law, I have set a 3-month window to sell this concept or launch it myself. Either way, I will be unleashed to live my 4HWW. Can’t wait to see your reply!!!

    Warmest regards,

    Ken

    Reply

  • Stephen Key — June 29th, 2010, 8:44 am

    Siva,

    “Studying The Marketplace” is the first step i teach my students.

    You need to figure out how the benefits of your product stack up to other products in the marketplace. You need to get out to the stores and search on the Internet. Google Product search is a great tool. http://www.google.com/products

    I have a free radio show where we talk about these issues ever week. You can check it out at http://www.inventright.com

    -Stephen

    Reply

  • Stephen Key — June 29th, 2010, 8:57 am

    Tyrone,

    Thanks for being a loyal listener of our Internet radio show. Andrew and I have a lot of fun doing the radio show and based on the feedback from our listeners, people seem to enjoy the show and appreciate the advice we give.

    I get this question about NDA’s all the time. It’s a common concern.

    Here’s the short answer……
    I have found that most companies will not sign an NDA. Your Inventors notebook, Provisional Patent Application or Patent is what i use as protection instead of an NDA.

    This doesn’t mean that i never use NDA’s. I just almost never use them when initially showing my ideas to companies. If they want more details later, I might ask them to sign one, but not usually. Instead, I focus on cutting the deal and getting everyone to move forward.

    -Stephen

    -Stephen

    This is not legal advice. Seek the services of an attorney if you need legal advice.

    Reply

  • Stephen Key — June 29th, 2010, 9:05 am

    Hello Ken,

    Thanks for being so kind with your praise.

    Here are some answers to your questions…..

    1)
    RE: Selling Intangible ideas

    Yes, that may take a while to go into. Feel free to email me at stephen@inventright.com

    2)
    RE: Do you ever partner with people to pitch an idea for a % of the profits?

    No, we stick to performing a “Teacher/Mentor” role and you keep 100% of the profits.

    3)
    RE: Are there ways to rent an idea to multiple licensees?

    Absolutely! The deals just need to make sense to all parties involved. You can break a deal out by geography, distribution, maybe you sell two slightly different versions. I have licensed my spin label invention and am receiving royalties from many licensees(manufacturers).

    -Stephen

    Reply

  • Kathlene Mullens — July 16th, 2010, 1:52 pm

    My kingdom for a provisional patent sample that is not so intimidating… ok, so not a kingdom, but a hearty thank you at any rate!

    Reply

  • Tyrone — July 20th, 2010, 9:17 am

    Hi Mr. Key

    I was told by a few companies that they
    would not look at my idea. Only if I had my own company and the product
    was up running. Can you explain why companies need the
    product to be in production already?

    Thank You

    Reply

  • Andrew Krauss — July 21st, 2010, 7:47 pm

    Hello Tyrone,

    Most companies do not require a that you have a company and that you are already selling the product in order to license it.

    Most companies just want a good idea. The companies you are talking to are the exception, not the rule.

    -Stephen Key

    Reply

  • Stephen Key — July 23rd, 2010, 9:11 am

    I have been contacted by the producers of a new prime-time show on the Discovery Channel.

    We were asked to help get the word out to our network of Inventors about this opportunity.

    Please read submission guidelines below and if you are interested, direct all submissions to
    Scott Michnick at scott@krakenpictures.com

    ——————
    New prime-time show the Discovery Channel is looking for inventors & entrepreneurs to showcase their creations. The program will feature two hosts (who are experts in invention/innovation/product development) who travel around the country meeting people who are working on “the next great idea”

    We’re looking for inventors who have…

    * Mechanical Masterpieces – Does your invention have lots of cool moving parts?

    * Does it aid in the transportation industry? (increase fuel efficiency, use alternative fuels?)

    * Does it feature green energy?

    * If not any of the above, can it be “tested/demonstrated” in interesting ways. The more creative the test, the better. Can we take it to the “mall/store/main street” and have people try it out? Could we give it to “the target market” and have them try it out for the day? Can our hosts use it? Obviously inventions don’t all fit into this category, but the more “hands on” the product, the better.

    * Is it an AWESOME, MUST LEARN MORE ABOUT thing?

    * If your product doesn’t fit the above, but your invention is “just plain fun,” email us!

    * Inventors who have made major personal sacrifices in order to get their ideas off the ground are also very desirable.

    Interested inventors please email the following…

    * Photo of you and your product

    * A couple paragraphs describing who you are and your general location (so we can map out our “road trip” geographically). Describe your product / how it works, why is it better than “what’s already out there” and outline any personal sacrifices you’ve made to make your product come to life.

    * Links or video clips of you and your product in action

    Scott Michnick
    scott@krakenpictures.com

    Reply

  • Jariel — August 19th, 2010, 10:19 am

    Hey Stephen,

    Big fan of your work and the support you give the inventor community!

    I just graduated college and over the past 6months I have been coming up with ideas, writing them down, and determining if the product is commercially viable while also desirable to people. If it is I create a rough sketch and have my designer in the Philippines create unbelievable renderings of the product, it’s packaging and how it looks in use. I pay him $8 dollars (not a lie) for each IDEA and receive about 5 unbelievable images of the product a week later.

    I then create a sell sheet similar to yours and send it to a guy that owns a large impulse shopping company in California. I also send him a second document that is an extensive study on the market, a marketing strategy, a distribution strategy, how the product differentiates itself from other products in the market etc…

    I got in touch with this CEO through my next door neighbor whose his son. A couple months back I had a one hour conversation with him and he told me what his criteria is etc… I feel comfortable sending him ideas without patenting them and he has told me that if I send him a product concept but I don’t know how to make it ‘technologically feasible’ and he likes it – his team will figure out the engineering aspect of it.

    I have been pitching my product designs to him only, have licensed two of them and I am sitting on a bunch of concepts that he has turned down. I am ready to start contacting other companies but I have three questions:

    1. How likely is it to sell a product concept that you know an engineer could easily figure out but you personally do not know how it would work? An example being a soap dispensing scrubber (AKA loofah) that shoots out soap when you push a button (believe it or not the concept does not exist for loofahs but does for dish washing products). Do you need a proof of concept prior to pitching an idea?

    2. I feel licensing ideas is a numbers game, the more ideas you pitch the more likely you are to sell one. I have over 100 ideas with renderings and market research on 25 of them – I can do this because each idea cost me $8 to render. If I got a provisional patent on each of them it would cost me $2,500. I’m am not an inventor that is worried of companies stealing my idea (maybe I’m naive)… What do you think of writing up the provisional patent for each of them, pitching the concept to the company, feel out their reaction to your product and filing for the provisional patent once you feel you’re getting interest?

    3. What’s you’re take on pitching ideas over the phone? I feel there is nothing better than having a face to face meeting to sell an idea and sometimes that’s just impossible. If I pitch a company on the first call I make to them – what are some strategies you suggest to keep them engaged after your sale?

    Thanks in advance for all your help and support!

    Best,
    Jariel

    Reply

  • Stephen Key — September 8th, 2010, 2:53 pm

    Hello Jariel,

    Sounds like you are doing great!

    RE: Your questions

    1)
    I pitch products all the time that I’m not 100% sure can be made. If I’m 70%, sure that’s usually good enough for me. Sometimes I’ll bother to do the research. Other times i won’t bother with the research and just see if there is interest first. Quite often the manufacturer will see your faked prototype and say…”sure, we can make that”….. and you don’t need to bother with a prototype. Other times they will ask you to prove it. If a company is sincerely interested in your product, they will wait for you to make a prototype if you need to.

    2)
    I do that all the time. Everyone needs to decide how much risk they want to take. For me, i don’t think filling a PPA after i call companies is a big risk. I’ve never been burned using this approach. However, most people new to the game of licensing feel more comfortable filling a PPA for their first couple projects.

    3)
    Face to face is a waste of time. Work the phones.

    Keep up the good work!
    -Stephen

    Reply

  • Dave — October 23rd, 2010, 12:16 pm

    Stephen,

    I have a product idea that is a medical device. Should I be concerned with having medical testing done to comfirm its effectiveness before i try to sell it to anybody? Or will a manufacturer be willing to pay for this kind of thing?

    Thanks for your help

    Reply

  • Steve Hudson — October 28th, 2010, 7:08 am

    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?

    Reply

  • Stephen Key — October 29th, 2010, 8:34 am

    Dave,

    Medical device testing can be quite expensive. I’d pitch it to some companies to see if they have any concerns. After all, they are experts in the product category.

    Then if they are interested, yes …. try to get them to pay for the testing. If you work together with them, make sure they sign something that says, “you own any improvements”.

    Stephen Key

    Reply

  • Stephen Key — October 29th, 2010, 8:41 am

    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 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

    Reply

  • Kristy — October 29th, 2010, 4:10 pm

    This has been the best thing I’ve read since I came up with ideas!!!
    (Just so you know, I googled “how to pictch ideas to companies,” in order to find this link)

    I’m definitely an “idea generator,” however, I never knew how to successfully pitch it!

    Here’s a HUGE mistake I have made in the past when a friend & I came up w/a fragrance concept idea…I was 24 then, now I’m 32.

    We secured a meeting with Coty Inc. and divuldged everysingle idea with no patent, protection at all (if I could go back to that day I would have at least videotaped the presentation)

    They loved all our ideas and said they would “get back to us.” 3 months later, I get an email from the CFO saying the idea “would not work with their current marketing plans.”

    A few months after that, our ideas were stolen! Not necessarily by them, but by other companies in New York.

    We were 2 young naive girls who were gobbled up by the giants of businessmen of New York.

    Oh how I wish I could go back in time.

    Thank you Stephen for this awesome article. I look forward to reading all your books and putting my ideas into action. You will definitely hear back from me again :)

    Reply

  • Kristy — October 29th, 2010, 4:15 pm

    I forgot to mention, the latest thing on my mind is an idea for a style of bag. It’s a million dollar idea for sure. It’s one of those “I can’t believe it’s not in the stores yet” ideas! One that once made will have people saying “why didn’t I think of that!”

    Do you have any recommendations for bag manufacturers that you have dealt with in the past? Friends in the industry?

    It’s one that will have TSA officers at the airport saying “That is clever!”

    Reply

  • Emily H. — November 13th, 2010, 8:11 am

    Hi Stephen,

    I’m a big fan, and I need some guidance with my first product. I’m wondering though if the process will be different – my product is a series of how-to books and tools that (is available online only right now) can be made into booklets and CD-ROMS.

    Do I need to have them Copywrited instead of Patented? How would my process differ – if at all – from the typical invention process?

    Thank you SO much for your help!!

    Reply

  • Stephen Key — November 16th, 2010, 12:16 pm

    Kristy,

    Thank you for sharing your concerns about getting ripped off. My business partner Andrew Krauss and I have been counseling Inventors for over ten years.

    If there is one thing that we’ve learned, it’s that we need to help people overcome their fears of getting ripped off, fear of calling companies and many other doubts and the concerns that they have. You will not move forward without removing or at least reducing these fears.

    Take a listen to our radio show at http://www.inventRight.com . We’ll mention your name and talk about fears for our next show.

    Stephen Key

    Reply

  • Stephen Key — November 16th, 2010, 12:18 pm

    Kristy,

    RE: your bag question.

    I would need more info to go on. Go ahead and book an appointment with inventRight Co-founder Andrew Krauss at http://www.inventRight.com/411

    He’ll give you 15 mintues of his time for free and some direction.

    Stephen Key

    Reply

  • Stephen Key — November 16th, 2010, 12:20 pm

    Emily,

    Most people that write “How To” materials use copyrights to protect themselves. Some also use trademarks.

    This is not legal advice. Please consult your attorney if you require legal advice.

    Stephen Key

    Reply

  • Chris — December 28th, 2010, 2:51 pm

    Hi Stephen,

    Thanks for posting the article and your continued response to questions! The Q&A has been very helpful.

    1) I was curious, is it possible to license product shape? ex: Cheeto’s did a snack food that was in the shape of “X”s and “O”s.

    2) Can you license a product to a manufacturer that already has rights to another license involved? ex: I recently purchased a laptop case with a logo of an NFL team on it. If my idea was a different product with just a team logo on it, is this possible? Aside from official sports teams, also included would be large brands like Hello Kitty or Marvel. Possible to earn royalties on a new way to display these brands?

    3) If a company patents a product that has the same basic principles/benefits as yours, but either the manufacturing or material is different, or a slight improvement is made, would you still receive royalties from that company? Since the core of the product is still your idea?

    Thanks!

    Reply

  • Marilyn Madden — December 29th, 2010, 6:41 pm

    I, too, was confused regarding who to contact for my new medical device invention. It involves the feeding tube process system. To make
    sure I understand who to contact, would it be a company like Kimberly
    Clark, Colorplast,etc. These are companies who sell feeding tube supplies.
    My invention is a great improvement over the present day use. I also
    believe it is a great invention. I was once tube-fed and I know what is
    needed. With the baby boom population coming on, tube feeding could
    be a part of everyone’s life at some point in time.

    I really enjoyed reading the Q&A on your website.

    If I am right about what company to approach,please advise.

    Thanks.

    Marilyn

    Reply

  • Stephen Key — January 2nd, 2011, 10:09 am

    Chris,

    1)
    Design patents can protect the way something looks. I’d suggest learning more about them.

    2)
    Yes, of course you can license an idea with a company that already has a license with brands like Nascar, Hello Kitty, Mickey Mouse ect.. Great idea. That’s what i did with my Michael Jordan Wall Ball. You can see a pic of the product on this page. http://www.inventright.com/about.shtml

    3)
    Most ideas are just improvements, so quite often you can protect your improvements. You are covered for whatever you are protecting in your patent, so of course it will depend on what you are protecting.

    Stephen Key

    Reply

  • Stephen Key — January 17th, 2011, 9:27 am

    Marilyn,

    I’d contact medical device companies that already have distribution where you want your product to be.

    So first, research where hospitals or individuals (depending on who would buy feeding tubes) purchase their medical supplies. Then look around at these companies, web sites, catalogs or stores. What manufacturers are selling to these distributors or retailers. License to them and get a percentage of every sale they make. That’s licensing!

    Stephen Key

    Reply

  • Lucas — January 23rd, 2011, 10:57 pm

    Steven,

    First, great interview, thank your so much for sharing. (and still answering questions on a 3 year old article!)

    Question: how do you come up with reasonable sales figures. I can find the companies but if they are private how am I supposed too know how much product they can move per quarter?

    It seems unlikely they will want to share this information during contract negotiations

    Reply

  • Stephen Key — January 24th, 2011, 9:24 am

    Lucas,

    They may not share sales figures, however they will share how many stores they are in.

    Figure a minimum of one unit per store, per week and you have a nice estimate of the volume they can do.

    Of course they may sell many more than one unit per store per week, but knowing that they can at least sell the number you come up with will tell you if you want to license your idea to them.

    Stephen Key

    Reply

  • David — February 18th, 2011, 6:39 am

    Hi Stephen,

    First, a big thank you for continuing to answer questions in this format. What dedication! I have an idea that is pretty much a slight change to a popular kids’ toy (e.g. Etch-a-Sketch), but with this change it can be sold to a different market. My two questions:

    1.) Presumably a company already owns the patent/copyright to the original toy, can I file a PPA with my improvements/changes? Would I neet to contact the original patent holders or get their permission?

    2.) Given that the change means selling it to a different market (i.e., not children), does it make sense to approach the same manufacturers of the original with my PPA?

    Reply

  • Stephen Key — February 21st, 2011, 10:18 am

    Hello David,

    Thank you for the question. By the way you worded it, i can tell you are over emphasizing patents. Don’t worry, everyone does…..

    I’m sure it’s just the way you wrote the question, but you would never approach a company with a patent or PPA. You approach them with a sell sheet to sell the benefits of the idea. You are always selling BENEFITS! Not your patent or PPA. For example, ” My Kitty Litter Doesn’t Stick To Your Cat’s Paws”. That’s a benefit and that’s what you are really selling, not your PPA.

    With regards to your patent question. It really depends on what they are protecting and what you are protecting. There is no way i could answer your question without looking at the prior art.

    Quite you can come up with a variation of an idea that does not violate a patent. So, you should be encouraged to know that this is quite often possible.

    Reply

  • David H — May 25th, 2011, 8:06 am

    Stephen,
    What a great read! I’ve only found out about you last night and I’m already thinking of new ideas to pitch. Thanks for your service to inventors!
    An idea I have involves kitchen appliances and it would require the addition of hardware that would freshen up this “sleeping dinosaur” of an industry. The twist is that it would also require food manufacturers to make slight changes to their product on a superficial level. (I’m trying hard not to just blurt it out)

    What can I do to help ensure that both appliance manufacturers and food companies took the steps needed to get this innovation on the shelf? It would benefit both industries so would I try to get meetings with both companies together? May I send you an email to expand on this idea and get your feedback?

    Reply

  • Stephen Key — May 25th, 2011, 2:08 pm

    Hello David,

    Yes, of course. email me at stephen -at- inventright.com and I’ll help you out.

    -Stephen

    Reply

  • Iris Angela — May 26th, 2011, 4:53 pm

    Hi Tin & Stephen,

    First, I would like to say how glad I am to have found this article.(Thanks Tim!)
    If I hadn’t come across this article I believe I would have been mopping thinking about my ideas to death.

    I have learned so much in very little time and continue to do so. Your continued support and reply to questions is much appreciated! Thank you for sharing your knowledge with us Mr. Key!

    The truth is I have always had many ideas ever since I could remember and particularly three that I believe will certainly led to a potential purchased because the ideas are very simple, innovative and the audience target is vast. However, my biggest concern is that I lack the knowledge about the proper process to go about it and have fears of denial. I have prepared my sell sheets, but I am pretty clueless to what comes after and I am starting to lack confidence. Also, I am only a twenty one years old female and afraid that no one will take me seriously.

    I am really considering purchasing your inventRight course as I believe that I desperately need your help and mentoring. Will you be available for contact once I am on the program?

    -Any feedback is much appreciated.

    Thank you,
    Iris Angela

    Reply

  • Peter F. — May 31st, 2011, 6:00 pm

    Tim and Stephen,

    Thank you for this informative interview. I now realized others have the same questions/ barriers as I do regarding licensing. Anyway, I understand that inventors must maintain a logbook to document their invention’s progress and protect their idea. So do we need a different notebook for EACH invention? Or can we use one notebook for all ideas which would save paper.
    -Peter F.

    Reply

  • Stephen Key — June 3rd, 2011, 8:26 am

    Hello Iris,

    Yes, my business partner Andrew Krauss and I support our students one on one over the phone or via Skype.

    I’ve found that our students knowing that we are their standing behind them while they work on their projects and making sure they are saying and doing all the right things gives them the confidence to move forward.

    So, yes I am available for one on one contact if you are an inventRight student.

    -Stephen

    Reply

  • Stephen Key — June 3rd, 2011, 8:34 am

    Tim,

    No, you don’t need to have a different Inventors Notebook for every idea. Considering how many ideas so people have, that would be difficult. If you do have a big idea or need to take a lot of notes on a particular invention, you might have a separate notebook for that idea.

    The notebook you use does need to be stitched like those marble composition notebooks you used in high school or college. The pages can’t be torn out without someone noticing. This is very important. You can’t use a notebook where you can add and remove pages for obvious reasons.

    There are also some other requirements for an Inventors Notebook that I don’t have enough space to go into here. Google “How To Keep An Inventors Notebook” and you’ll find an article or two.

    -Stephen

    Reply

  • mikey — July 5th, 2011, 11:07 pm

    Thank you for all of your input here- what you are sharing is enlightening for me. One initial question: am I understanding correctly that you’ve licensed 20 products in 30 years, because this doesn’t seem like very much for that time period (considering it takes you just a few months to license a product)?
    Not trying to criticize, just get more informed!

    Reply

  • Stephen Key — July 6th, 2011, 8:22 am

    Mikey,

    20 is conservative. I’ve actually licensed a lot more than that, but i didn’t want to count many of the novelties in my bio since many of them didn’t earn much money.

    You see it’s not the number of products that you license. It’s the money you make on each one that counts for the financial part of things.

    You could license 200 ideas and if they only made a little bit of money that would not be as good as licensing 20 ideas and a few end up being big hits that sell huge volume and continue to sell for years and years.

    My spin label invention has been on many products around the world. I’ve been working on it for over a decade and it’s been good to me.

    I’ve had other products that sold for a year or two and produced very little money.

    Hope this helps you understand the numbers game.

    Reply

  • Stephen Key — July 18th, 2011, 11:31 am

    Peter,

    I just realized that you asked a question a little while back about Inventors Notebooks and I didn’t get to it.

    Your question is a legal question, so please consult an attorney to make sure to get a correct answer.

    I can just tell you what i do. I normally have one notebook with all my ideas in it and then start a new one when it’s full. However, if i have a really big idea, sometimes I’ll have a dedicated notebook just for that Invention.

    Reply

  • Stephen Key — July 18th, 2011, 12:05 pm

    Iris,

    RE: Your question

    “I am really considering purchasing your inventRight course as I believe that I desperately need your help and mentoring. Will you be available for contact once I am on the program?”

    ——————

    Yes of course, we provide a year of unlimited one on one phone support.

    -Stephen

    Reply

  • Adam — August 5th, 2011, 8:50 am

    Stephen,

    One of my inventions, an exercise product, has a couple of add-on components. Each enable the user of the main product to perform a different exercise when attached. Would you include these in a single PPA with the main product, or should I file a separate PPA for each add-on?

    Thanks,

    Adam

    Reply

    • Stephen Key — August 8th, 2011, 8:11 am

      Adam,

      I’m not a patent attorney and can’t often legal advice.

      I can say for myself that i quite often include variations and all the possible components of an Invention when i file a PPA.

      Please consult your attorney for legal advice.

      -Stephen

      Reply

  • kb — August 18th, 2011, 7:47 am

    How are you,

    I have an idea for vodka companies, who would i contact vodka brands directly or manufacturers who does it for them ?

    Any suggestions ?

    Thank you

    Reply

    • Stephen Key — August 19th, 2011, 4:26 pm

      KB,

      That would depend on what kind of idea it was.

      If it was a packaging idea, you might contact a contract manufacturer that bottles for several vodka companies.

      -Stephen

      Reply

  • Rob Paul — September 15th, 2011, 3:39 am

    Hi there. First off let me thank you for all this helpful information. I’ve had ideas for many years that I thought could be profitable but always thought it was out of my reach. Now I’m back coming up with ideas and have one provisional in the works.

    So on to my question. If I improve on a part of an item. A small part but it’s a very big improvement. How do I approach a company with that and how could I figure out the royalties on such an item?

    Reply

  • Stephen Key — September 15th, 2011, 12:57 pm

    Rob,

    I’m glad that you now understand you don’t need to a bunch of money in the bank in order to work on your ideas. I think it’s sad when people don’t work on their ideas because they think they need thousands for patents and prototypes. Good for you!

    Improvements to existing products are great! They make it easier for consumers and companies to grasp the idea. The fact that your idea is an improvement and offers a big benefit is great!

    With regards to your last question. Basically your are asking…. “How do i sell my idea and how do i figure how much to ask for”.

    The first part of your question is to broad to cover here. We have a lot of free info on http://www.inventRight.com . One resource which is cheap, but not free is our book “One Simple Idea”. A few free resources are our radio show and all the interviews with our students that have licensed ideas. These are both totally free and very educational.

    With regards to royalties. The range could be anywhere from .0001% up to 50%. For most consumer products though it’s usually 3 to 10% of the wholesale price.

    I hope you find this advice helpful.

    -Stephen

    Reply

  • Alfonso — September 26th, 2011, 9:40 pm

    With everyone that states in their opening remarks, thank you for all the noteworthy information you’ve been providing…such a life changer, really.

    My question is that I have invented a new twist for the piercing market, the ear tunnels(plugs) that these people wear. I’ve done some research and over 24million people have piercings in the US alone. I know my design has a great chance of being popular and I already have a 3D engineered model made. The two points I’m hung up on are 1.) electronics, do I have to figure that out too before I present? Should be just a matter of components that already exist, but need to be placed together. 2.) Money coming in for years sounds great, but I know once these are out, similar designs will follow. Can I make a deal for a nice chunk of change up front? That way I can move on to my next idea, plus have the financial freedom until I do.
    There aren’t enough words to thank you for all you’ve given to this community…but, I hope this’ll do…Thanks!!!!!!!!!!!

    Reply

  • Stephen Key — September 30th, 2011, 8:51 am

    Hello Alfonso,

    1)
    You don’t always have to figure the electronics out. If you see similar products with the same features such as flashing lights, you could draw some conclusions as to if your product can be made and at what price the same way.

    Another thing you can do is call a contract manufacturer and get some price quotes for large quantities. They will not only give you a quote, but will give you feedback as to if the product can be made the way you’ve designed it.

    2)
    It’s possible, but really not a good idea in most cases to ask for a large amount of up front money. Companies like to pay you when they get paid. In most cases, asking for a large amount of up front money will kill the deal.

    Thank you for the kind words about helping answer peoples questions.

    -Stephen

    Reply

    • Alfonso — October 1st, 2011, 8:11 pm

      Thanks again Stephen for your help! I don’t have the funds currently to enroll as a member, but I’ve been downloading and listening to your free webinars and I’m just going to jump in and see if I can pull this off. I’ll come back and let you know how it goes!
      All my best to you & Andrew for sharing your gift of knowledge!

      A.

      Reply

  • Stephen Key — October 3rd, 2011, 4:37 pm

    Alfonso,

    Your welcome.

    Follow your passion for Inventing!

    -Stephen

    Reply

    • Alfonso — October 17th, 2011, 10:55 am

      Hi Guys! I’ve created two versions of my Sell Sheet(male/female), just because I thought I might have twice the chance with the people within the company I send it to.
      I made my first call to a company in NY…I’m in CA. It went REALLY well ! I was actually the First person to have called regarding a product submittal?!
      The Merchandise person I spoke with says he’s interested, but wants to check with his manufacturer on it’s viability. But I know it will check out because, I had it engineered and spoke with another engineer from china already about is electronics.
      Anyway, my question is…He wanted to know what my “Dollar Amount” is? I told him I was looking for a Licensing agreement and a royalty on percentage, but he kept talking about dollar amount. How many dollars from the sale. Kinda threw me for a loop. Have any thoughts on the right response? I told him I’d be willing to settle for the dollar amount that wouldn’t compromise or be a stumbling block for this deal to go through, but enough to make me a nice profit.
      Thanks again for all your help!!!!!!!

      Reply

      • Alfonso — October 17th, 2011, 10:56 am

        PS,
        I’m making my second call right now! :D

        Reply

      • Stephen Key — October 24th, 2011, 11:49 am

        Alfonso,

        That’s easy. Just let him know that you are looking for “a reasonable royalty per unit” and that you would need to understand what they would do with the product and where they would sell it. Then you’d be happy to get them some numbers.

        -Stephen

        Reply

  • Chas — October 5th, 2011, 12:48 am

    Stephen your posts have been inspiring and informative. Thank you so much for taking the time to do this.

    Quick question: what if my idea involves improving an existing type of packaging by adding something to it that is already patented?

    I know you have said the packaging sector is good because of not much innovation and not as much competition and this is a really good idea but i dont know how i woud get around that detail??

    Any advice maybe?

    And thanks so much again!

    Chas

    Reply

    • Stephen Key — October 6th, 2011, 9:09 am

      Chas,

      Sometimes your idea is different and does not violate the existing patent you are looking at. OR….maybe you can change it up a little so it doesn’t overlap on to what the patent you are looking at is protecting.

      In other cases, you can patent on top of the other patent. But of course you or anyone else that uses your idea will also need to get permission from the other patent holder.

      -Stephen

      Reply

    • Alfonso — October 18th, 2011, 10:02 am

      Hello Stephen and Andrew,
      I wanted to thank you again for all the information and questions you’ve answered here as well as making those webinars available! I’ve learned a lot and have put that to use and as of this morning, I have a company that wants exclusivity for Domestic & International rights for my product!!!!!
      Terms & Negotiations will begin soon, I can’t believe this is happening?!!!!
      A dream come true and for anyone reading this…it can happen for you as well, keep trying!!!! Take in as much info as you can from these gentleman because it’ll change your life!
      All my best!

      Reply

  • Tony — October 5th, 2011, 4:08 am

    Hi Stephen. Firstly i want to say that its amazing that you’ve been responding to the questions on this blog for years. Really shows your dedication and love for your work.

    My situation is this:
    I have an idea to create a carry case for a product X.
    However this product X is not sold in Australia, and is only available through online stores (and retail stores overseas).
    The manufacturer/developer of product X is in China, there is a phone number and a general info@ X.com email on their site.
    My question is, can i get a patent pending in Australia for a similar price, and is there a different/special approach i should take if i am going to contact someone in China? Do you have students in Australia who have gone through a similar process, in terms of getting a patent pending and contacting companies overseas?

    Thanks Stephen, i’ve already ordered your book online and can already tell its going to be a big help!

    Reply

  • Stephen Key — October 11th, 2011, 8:04 am

    Tony,

    In many countries you can’t patent an idea if it’s already been patented or publicly disclosed in another country. So you may want to talk to an Australian patent attorney.

    -Stephen

    Reply

  • Rocky — October 23rd, 2011, 4:31 am

    Hi Stephen. I am a newbie in patent/licensing area and i have several question to ask. I have an idea related to Information Technology term. With my idea, i wish to create a product and then sell it on market. I didn’t submit a patent or license yet for my idea, but i just want to make a presentation about my idea on my previous workplace (it is an IT company). My question:

    1. Do i need to get license or patent first before i’m going to made schedule and presentation on the company?
    2. Is there possible if i didn’t submit patent or license but i can take a royalty from the company if they receive and implement my idea (with agreement)?
    3. One-time (several months ago) after i’m sure with my idea, i just post my idea in certain forum to discuss with the forum’s members. I do post the method, but not all to make sure if my idea was right. With this situation, did my post will become a public domain? If yes, is there still any way to get a license/patent for my idea, with some method modification maybe?
    4. As for me (as far as i know), submitting patent or license are very expensive and took a long time to wait for its approval. Is there any good way to sell the idea without have any license/patent on it?
    5. Is there any company that did buy for unpatented idea or give some royalties for unpatented idea?

    Thank you very much for your answer :)

    Reply

  • Andrew Krauss — October 24th, 2011, 11:51 am

    Alfonso,

    Thanks for the kind words.

    You are welcome.

    -Andrew

    Reply

    • Alfonso — October 24th, 2011, 1:51 pm

      Hi again Andrew,
      Another question for you…do I need a Term Sheet in contractual form or can I write down my “terms” nicely in an e-mail and get to the “negotiations” the same way?

      Thanks a million?!

      Reply

      • Alfonso — October 25th, 2011, 2:12 pm

        Thank you Andrew and Thank you Stephen…your reply answered my question a little more directly. No disrespect to you Andrew at all. You’d actually be surprised how many links I found on “term Sheets” also under various names. I will go ahead and make my “terms” known and hopefully go from there upward! I’m lucky to have gotten this far & look forward to finally getting to the “Licensing Contract” part.
        If either you Stephen or Andrew would like to view my Sell Sheet, just ask and let me know where to e-mail it to…I’d be happy to share :)

        Thanks again to both of you!!!!!!!!!

        A.

        Reply

  • Andrew Krauss — October 24th, 2011, 1:42 pm

    Rocky,

    That’s a lot of questions….

    Since you are new to licensing and do seem to be confused on a couple things, I’d be happy to help you out on the phone and answer a few of your questions.

    Give me a call at 650-793-1477

    -Andrew

    Reply

    • Rocky — October 24th, 2011, 9:51 pm

      Hello Andrew, thank you for your help.

      Could you please help me to answer my question via email? Since i’m stay on different country, it will be very expensive for me to make a phone call.

      Thank you very much :)

      Reply

  • Andrew Krauss — October 24th, 2011, 2:44 pm

    Alfonso,

    We call that a term sheet.

    Yes, it’s a good idea to get the basic terms down. At inventRight we call it a “Term Sheet”.

    Then once you agree on the basic terms you can go to a contract.

    -Andrew

    Reply

  • Andrew Krauss — October 25th, 2011, 8:42 am

    Rocky,

    No problem. Here are some answers to your questions. By the way, Stephen and i have students in 30 countries. You should never feel restricted by your geographic location. You can make phone calls to the US for only pennies using Skype out. Our students do it to call companies and you can to!

    1. Do i need to get license or patent first before i’m going to made schedule and presentation on the company?

    **** A provisional patent application would be a good idea in most cases. It’s only $125 if you file it yourself. ****

    2. Is there possible if i didn’t submit patent or license but i can take a royalty from the company if they receive and implement my idea (with agreement)?

    ****Anything is possible. What i can say is that in the 10 years Stephen and i have been teaching and mentoring our students, not a single student has had one of their ideas stollen. I think that’s because they are conducting themselves professionally and doing and saying the right things. I’m sure it’ll happen one day. It’s just a numbers game. You can never get 100% assurance that nothing will go wrong in any business. And that includes licensing. *****

    3. One-time (several months ago) after i’m sure with my idea, i just post my idea in certain forum to discuss with the forum’s members. I do post the method, but not all to make sure if my idea was right. With this situation, did my post will become a public domain? If yes, is there still any way to get a license/patent for my idea, with some method modification maybe?

    ***** You will need to contact your patent attorney on this one. I can’t offer legal advice and even if i did, i would need more information to answer this question. My advice…. In the future, don’t post your ideas to forums.*******

    4. As for me (as far as i know), submitting patent or license are very expensive and took a long time to wait for its approval. Is there any good way to sell the idea without have any license/patent on it?

    ****** I think you are confused about the word “license”. You create/get a license or “Licensing Contract” when you sell your idea to a company. And yes, certain categories of products don’t care so much about patents. Novelties is one of them. So, yes you can license ideas without a patent. ****

    5. Is there any company that did buy for unpatented idea or give some royalties for unpatented idea?
    **** Yes, we’ve had students that have pulled that off. One is John with his bear bong belt. He recently graduated from college and licensed his novelty. You can now find it in Spencers gifts. John’s one hour interview is up at http://www.inventRight.com if you want to watch it. *******

    Thank you very much for your answer :)
    *** Your very welcome. ****

    -Andrew

    Reply

  • Stephen Key — October 25th, 2011, 8:46 am

    Alfonso,

    Your term sheet is just in a word doc or email that’s not in contractual form.

    Think bullet points….

    As Andrew stated it’s just the major deal points to see if there can be an agreement before spending time or money on a contract.

    -Stephen

    Reply

    • Alfonso — November 12th, 2011, 4:16 pm

      Hi again Stephen & Andrew,

      Just wanted to let you guys know that I am now the proud owner of a Licensed Product! It’s a real thrill ! Thanks so much for all the answering of questions and the information given out to everyone here, it changes lives!

      The company I’m connected with is looking forward to viewing my list of other possible products once this product is selling. Can’t wait to see what’s in store for the future!

      Thanks again!!!
      A.

      Reply

  • Rocky — October 27th, 2011, 5:44 pm

    Hello Andrew & Stephen,

    Many thanks for the answer. Many thanks for the advice, and i will not post my idea on any forums from now on. I feels like i just did a suicide :s. Anyway, it is more clear for me to understand about license. I thought that license is just like a certificate when we submit a patent. In my mind, we get a patent and then we get a license to use it. But after reading your article from http://www.inventRight.com, now i realized that license is more like an agreement between idea owner and the company who want to implement the idea.

    And for my case, i just want to made a presentation on company about my idea. So i need to make sure that the company agree to use my idea because it will help them to increase their production and income. My next question is (my apologize about a lot of questions :p):

    1. I learn that it is necessary to file a provisional patent before getting touch with any company. For this provisional patent, can i submit it from my own country? or it is only available in US?
    2. By the way i lived in Indonesia (Asia), and i didn’t find any term about provisional patent in any patent websites on my country. The very close meaning with provisional patent is maybe a “simple patent”. Is it the same with provisional patent?
    3. The cost is about $125 if i file it myself, and how long does it take for provisional patent?
    4. Do you have any tips on how to make a good presentation in order to company agree to implement my idea?
    5. In my mind, i’m just afraid when they agree to hear my presentation, but in the end they say “i’m sorry we cannot use your idea”. But then actualy they developed it after i leave them. Just like a stole an idea. Maybe it is possible because there are a lot of good and bad company out there. Do you have any strategy to prevent something like this?
    5. If the company was a good and agree to use my idea, the next step is maybe about to create an agreement or licensing contract. Do i need a patent attorney to guide me create an agreement or licensing contract?

    Thats a lot of questions for sure. I consider both of you as my teacher, and i don’t know how to recompense your effort for the great knowledge sharing. I kind of a careful person, and i will make a direct movements to the company after everything is clear. I will update my effort to inform you about my struggle :p. Once again, thank you for your guidance :)

    Reply

  • Stephen Key — October 31st, 2011, 10:16 am

    Rocky,

    1.
    Yes, you can submit a Provisional Patent Application from anywhere in the world. You don’t need to be a United States Citizen.

    2.
    I’d suggest checking with you local patent attorney.

    3.
    Yes, the cost is $125 and you can file it yourself. Once you do, you can say patent pending for one year. A PPA is not a patent though. It’s just a place holder. You will need to upgrade it in one year if you want it to become a patent.

    4.
    Yes, keep in short and sell benefits, not features.

    5.
    There are many strategies to protect yourself. Filing a PPA is just one of
    them. Conducting yourself professionally like Andrew and I teach our students to do seems to go.

    6.
    When you are in the final stages of negotiation, you will need an attorney, however it won’t be a patent attorney, but a licensing attorney.

    I suggest you get our book “One Simple Idea”. A lot of these questions are answered in there. More info on the book and our support services can be found at http://www.inventRight.com

    -Stephen

    Reply

    • Brian — November 4th, 2011, 1:59 pm

      Hi Stephen,

      A huge debt of gratitude to you sir for sharing your wisdom. I’ve learned more just by reading these threads than i have after reading several books about inventions and the process. I’ve just started reading your book and had to pry myself away to ask a simple question that i hope you don’t mind answering. I developed an addition to shoes. I searched existing patents and found that my idea had already been patented for 6 years. Should i dump the idea or try to negotiate terms with patent holders? If you would opt to negotiate terms, what value would you put on a shelved patent that has gone no where?

      Reply

      • Stephen Key — November 14th, 2011, 4:19 pm

        Brian,

        You are welcome.

        You have a few options.

        1) You can keep inventing and create another solution to the problem.

        2) You can talk to the patent holder and see if they will negotiate some terms where you get a percentage if you can close a licensing deal. Whatever you think is fair is the answer on terms. There really are no set rules here. One thing i will say is that if the inventor is not level headed, don’t work with them. If they are cool, consider working with them.

        3) Move onto the next idea.

        -Stephen

        Reply

  • Andrew Krauss — November 28th, 2011, 3:12 pm

    Alfonso,

    Congrats on closing your first licensing deal !

    Thanks for the kind words.

    Stephen and I love it when someone we help experiences success.

    -Andrew

    Reply

  • Christina — November 30th, 2011, 8:56 am

    Hi Stephen -

    I’ve been reading your posts and just thank god that I did not go for the Company that said they could get this done but $14,000. I decided that I want to do this myself. I hired a student who did a great image , 3d and all. I will be getting a Provisional on it this week , before that though , how much info is too much info to the potential Companies ? I’m so excited because we got these brochures made and they are short and sweet. It’s literally a 30 second pitch. I’m very concerned that they will say forget her, let’s fo some variations and do it ourselves… is a provisional patent enough, any tips as to what I can say to them as far as maybe telling them I have several patent pendings ? I just have a feeling that it’s a hit, but I don’t want someone or a Comapny to steal it. Also, should I put a patent pending # on sales sheets/brochures? Thank you so much, your advice has inspired me to do this on my own… and it feels great.
    Good day…

    Reply

  • Andrew Krauss — November 30th, 2011, 3:16 pm

    Christina,

    The solution is simple. File a PPA and include all the viable variations you can think of.

    Always make sure to include enough info in your sell sheet to sell the benefit of the idea. There is not point in confusing them or holding back, so they don’t understand the product.

    However, of course you don’t need to include details that are not relevant to “selling the benefit of the idea”.

    Also, keep in mind that they have no idea what your PPA covers or doesn’t cover, so no … never include your PPA filling number.

    Keep up the good work and good luck with your calls!

    -Stephen

    Reply

  • Christina — December 1st, 2011, 6:33 am

    Thank you for the response, talked to Andrew last night and I’m going to get the book , “one simple idea” before I do anything. I’ll let you know how it goes… :)

    Reply

  • Andrew Krauss — December 1st, 2011, 9:02 am

    Christina,

    You had a lot of energy when i talked to you on the phone yesterday. Take that energy and funnel it. Your going to do great!

    -Andrew

    Reply

  • Jenny Callentine — December 20th, 2011, 3:22 am

    Hi Stephen,
    After reading through Part 1 and 2 of this article I tracked down the owner of a company about licensing my idea. They are interested but have asked for a sample. As of this point, I do not have a prototype made and I do not know how I will get one done until after holiday travel, etc. Any suggestions on where to go from here? Does a prototype need to be made of the same materials that it would be in production (i.e lets say the real product would be metal but I make something simple out of paper, plastic, etc.)? Any advice would be greatly appreciated!
    Thanks,
    Jenny

    Reply

    • Andrew Krauss — December 21st, 2011, 9:53 am

      Hello Jenny,

      This is Stephen’s business partner Andrew Krauss. I co-founded our coaching company inventRight with Stephen ten years ago. I’d be happy to answer your question.

      I’d do a little qualifying.

      First, make sure the company you contacted is clear that your intention is to license your product to them. Sometimes companies think you are trying to sell them product that you have already produced.

      Once you establish that the company is open to licensing, ask them a few questions about their company. Like….” how do you see this product fitting into your product line if you were to take it on”. A companies willingness to engage you in a conversation is a great indicator of how serious they are. Anyone can just drop you an email and ask for samples.

      Another thing i would consider is making a video instead of sending a prototype. Prototypes get lost, broken and improperly used. A video that you create will always show the product in the best possible light every time. And if it doesn’t work well, you could shoot the video 10 or 15 times and just use the one take where it worked.

      Keep this in mind…. you are not selling your patent or prototype, your selling the benefits of your idea.

      Quite often, the manufacturer can see the benefits represented in your sell sheet and video and say……”wow, i can sell that……and yes i see no reason why we couldn’t make that”.

      So don’t spend 1k’s of dollars on a prototype if you don’t need to.

      Hope this helps.

      Happy holidays!

      Keep Inventing,
      Andrew Krauss
      inventRight Co-Founder

      Reply

  • Michael — January 17th, 2012, 4:34 pm

    Hi Stephen and Andrew,
    I’ve already filed a PPA and created a nice video showing a working prototype. I just started calling companies and so far I’ve had luck with initial calls and getting to talk to the right people at each company so I can e-mail them my video. How long should I wait after that first call before following up with them again? Also presuming I get some positiving feedback from the companies, any tips on the best way to move forward into closing the deal?
    My thought is to license this idea to as many companies in this industry as I can, instead of exclusive to 1 company. Also, my idea is not a standalone product, but rather an enhancement feature to an existing product, how should I calculate a reasonable royalty percent in that scenario?

    Reply

  • Stephen Key — January 18th, 2012, 2:47 pm

    Michael,

    Here’s an example and some answers to your questions.

    Ask for the marketing manager in charge of dog toys if you are doing a dog toy. Another thing you might try is to call the sales department. They always pick up their phones! There are many other techniques, however i couldn’t possibly cover then all here.

    RE: Follow up – Call to follow up after 10 days.

    If you get interest, ask them a few questions about what they’d do with the idea if they were to take it on. Realize….. you’re interviewing them as much as they are you.

    And always focus on selling the benefits of the idea. Just because they call you back, doesn’t mean they are completely sold on the idea.

    You could license to multiple companies. But, does it make sense if they will compete with each other? Most of the time no. But in some cases it could. I’d generally advise against this, but every situation is different.

    If you license different versions or to different areas of the world or different distribution channels, then yes.

    -Stephen

    Reply

  • Jay Howard — January 22nd, 2012, 8:11 am

    Stephen-

    Love your post, thanks so much for all your insight.

    I did have a question for you: what if our “idea” that’d we’d like to pitch for a company isn’t a physical product?

    I’ve got an idea that I want to pitch to a growing startup company- one that is a part of the whole “group buying” business model. I’ve got an idea that is purely a business PROCESS (a new way for them to deal with customers and clients, a very unique process of cash flow and how these relationships interact).

    My question is, how do I protect this business plan/process if it isn’t a physical product? A PPA? Have them sign a simple NDA?

    I’d value any help you could give! Thanks so much!

    Reply

  • Andrew Krauss — February 6th, 2012, 6:23 pm

    Jay,

    You might be able to get a “Business Method Patent”. Google it to find out more. An NDA would be a good idea also.

    Keep Inventing,
    Andrew Krauss
    inventRight Co-Founder
    I co-founded inventRight with Stephen 10 years ago with the goal of helping inventors license their ideas

    Reply

    • Jay Howard — February 6th, 2012, 6:31 pm

      Andrew,

      Thanks so so much for your reply, I’ll definitely look into that. Would you happen to know if you can file a Provisional Patent for a Business Method Patent? I’m not sure how all this works!

      Reply

  • Andrew Krauss — February 6th, 2012, 7:50 pm

    Jay,

    Yes, you can file a PPA on a provisional patent. Contact your attorney for more details and/or do some key word searching on google. Wikipedia will be real helpful for learning more.

    -Andrew

    Reply

  • Jonathan Manning — February 7th, 2012, 10:59 am

    Stephen-
    Great book! You have helped me finally decided what I want to be, an independent product developer! I just wish I would have known this was possible 10 years ago. I have a great idea for a huge company but don’t know how to get paid for it. I don’t have anything to patent, for example
    I want to let XYZ company know that if they put their logo and brand on a cell phone case they would make a killing! Seems like a simple idea, they should have this but don’t. How do I protect my idea from them saying they already thought of this and how do I get paid? Thanks for all your help and inspiration. P.s. can’t wait to make some money so I can take your course!

    Reply

  • Stephen Key — February 27th, 2012, 10:02 am

    Jonathan,

    Glad you were inspired by the book. And it’s even more impressive that you’ve decided to become a product developer. Very cool! It’s a fun and exciting way to make a living.

    With regards to your question. If you had a new way of putting logos on cell phones, such as the way it’s displayed or applied, that might be patentable and licensable.

    However, it’s going to be hard to get compensated by just telling a company that they should put their logo on cell phones.

    That’s more of a marketing idea. So, unless there’s more to the idea that you didn’t talk about, you might want to move onto your next idea.

    However, if there’s some sort of business method that goes along with it, you might have something.

    -Stephen

    Reply

  • April Woodworth — March 8th, 2012, 9:07 pm

    Stephen -

    I have a product that I have been making and selling for over a year. I would love to submit it to manufacturers, but I think I read somewhere that you can’t patent a product that you have marketed for over a year. Is that true? Sales are low because I don’t have $$ for the marketing.

    Reply

  • Andrew Krauss — March 9th, 2012, 9:00 am

    April,

    I’d be happy to answer your question, however i have to say i can’t answer your questions directly but rather speak in general terms since I’m not a patent attorney and can’t offer legal advice. Plus i may not be aware of other specifics pertaining to your particular situation.

    If someone publicly discloses their idea and more than a year has passed and they didn’t file a PPA (Provisional Patent Application) or a Patent within that year, that subject matter can most likely never be patented again.

    However, the inventor could it many cases still patent any improvements that they did not disclose during that year.

    This is not legal advice. Please seek the services of a patent attorney if you are seeking legal advice.

    Keep Inventing,
    Andrew Krauss
    Co-founded inventRight.com with Stephen Key 10 years ago to coach and mentor inventors through the licensing process

    Reply

    • April Woodworth — March 9th, 2012, 1:21 pm

      Andrew -

      Thanks for the reply. Even though you have to use general terms, you did confirm my thoughts. I have so many variations that I have not had for sale that I’m sure it will will not be an issue. The biggest problem I’ve had is that there is no other product like it on the market and no one knows what it is or that it exists unless they happen to run into my listing on line. I really think that yours is the direction I need to be going.

      Thank you -

      April

      Reply

  • Andrew Krauss — March 12th, 2012, 12:34 pm

    April,

    Yes, it is important that people understand your product when they see it. You might want to change up your packaging to accomplish this.

    However, some products need demonstration. These products tend to do well on Infomercials and on on networks like QVC and HSN. Then when people see the product in the stores they are already familiar with how it works and the benefits of the product.

    -Andrew

    Reply

  • Andrew Krauss — March 13th, 2012, 11:49 am

    April,

    Your welcome.

    -Andrew

    Reply

  • Nishant — April 4th, 2012, 9:10 am

    Hi Stephen,

    I started last week and as of today, I have ideated three brand-new features for a popular social networking website; I possess basic user-interface prototypes in terms of graphics and screenshots for the new features.

    I am going to open up a discussion with my uncle – who has vast experience in the marketing domain from his past jobs at several Fortune 500 companies – to seek his advise around the idea of “contacting-marketing-managers-of-the-target-company” !

    I have read transcripts of your interview with Tim – found it totally cogent, incisive and brilliant. I want to thank you for sharing such valuable inputs for the world, especially budding inventors like me !!

    May I have your final words/comments before I start on this beautiful journey ?

    Best regards,
    Nishant
    IT professional

    Reply

  • JO — April 5th, 2012, 7:06 am

    Hi Stephen/Andrew,

    I’m a relative newbie at this sort of product development/licensing so please excuse me if some of my questions are stupid.

    I have an idea that I have started doing a considerable amount of market research on and have started to get some designs drawn up so I have a prototype that looks professional. I know you say you don’t need to do this but my idea is very simple and hasn’t cost much to prototype.

    My problem is that I know its not patentable (as advised by a patent attorney – in Australia). It currently isn’t on the market (to the best of my knowledge). It isn’t patentable because all it is doing is bundling together some existing products and selling it as 1 product. However the benefit is convenience, and I believe it would be an extremely good seller.

    I’m not sure how to approach a manufacturer given I will have no protection (apart from trademark, although I’m sure they could come up with another name if they wanted to). I believe that if one company was to produce it, it wouldn’t be long before another competitor copied it, given that it isn’t patentable. So all that I’m really providing is the idea and ability to market it first.

    I believe the product would sell better in the US and Europe, so I’m unsure whether to approach the companies branch in Australia or whether I should go directly to the parent company in the US? and whether if I was to sign a licensing agreement with Aust branch whether that would limit possible royalties to just here and not OS??

    The advice that I have been given was to try and get a catchy name that could be trademarked (although this doesn’t really give any protection), do some focus group research, get a professional prototype made, and once that has been done go and give your pitch (on a silver platter) and hope that they see that you’ve spent some time, effort and money into it that they’ll do the right thing if they wanted to proceed with it, and not just say no and then do it themselves later (as there is no protection)? my worst nightmare!

    If you could provide any advice it would be much appreciated.

    Cheers

    JO

    Reply

  • Andrew Krauss — April 9th, 2012, 3:49 pm

    Nishant,

    It’s going to be hard to find some IP in the area you are working in. Other than protecting code, I would look into and learn more about business method patents.

    Keep Inventing – Andrew Krauss – Co-founded inventRight.com with Stephen Key over 10 years ago to coach and mentor inventors through the licensing process

    Reply

  • Andrew Krauss — April 9th, 2012, 3:55 pm

    Jo,

    In some industries you can license ideas that aren’t patentable and in others you can’t, so it will depend on the industry of your invention. I can’t answer your question since i don’t know what area/industry you are inventing in.

    Yes, a trademark will offer you some protection for a time. You can just do a free common law trademark (TM), however keep in mind that you can’t own a trademark unless you use it in commerce. Unlike a patent, you can’t keep other people from using it if you aren’t. However, it is a nice temporary place holder to let people know that you intend to use the mark.

    Keep Inventing, Andrew Krauss – Co-founded inventRight.com with Stephen Key over 10 years ago to coach and mentor inventors through the licensing process

    Reply

    • Jo — April 14th, 2012, 8:40 pm

      Thanks Andrew for the reply.

      The industry is healthcare/personal care (e.g. proctor & gamble, johnsons & johnsons).

      In relation to my question about whether to pitch to the companies branch in Australia or whether I should go directly to the parent company in the US? and whether if I was to sign a licensing agreement with Aust branch whether that would limit possible royalties to just here and not OS?? Do you have any opinion on which way you think would be best or how I could protect myself??

      I also gather from some of your previous blogs and comments, that you almost have zero chance of getting a NDA or CA signed by any of these companies, and in fact will most likely have to sign one of theirs to even get your foot in the door. If this is the case, it pretty much means that you aren’t protected in any way and are relying on them to be very honourable and trustworthy?? Do you have any advice about this area, or previous experience when dealing in similar situations??

      Once again your advice is appreciated.

      Cheers

      JO

      Reply

  • Nishant — April 11th, 2012, 11:43 am

    Appreciate your suggestion Andrew ! May I have your e-mail ID – I got more questions and I don’t want others to get confused?

    Reply

  • Andrew Krauss — April 18th, 2012, 2:47 pm

    Nishant,

    Of course. You can email me at andrew **at** inventright.com.

    -Andrew

    Reply

  • Andrew Krauss — April 18th, 2012, 2:51 pm

    Jo,

    RE: Australia vs US office
    I’d call them both! Don’t over think it. Get a hold of someone and pitch them your idea.

    RE: Protection and NDA’s
    If you get a US PPA(Provisional Patent) that’s a great form of protection that most inventors are happy with. They have them in Australia also!

    -Andrew

    Reply

  • MELLISSA KIM OCONNOR — May 23rd, 2012, 2:22 am

    This idea is about eliminating the black spots in communication and telecommunication engineering. we always prefer the best then why not in terms of communication well we can control the instrument we use but at the moment the routine of packets travelled and the strength of the signal cannot be detected or spiedor predicted thus to obtain a succesful transporting of packets the idea is implemented.

    Reply

  • Andrew Krauss — June 6th, 2012, 9:28 am

    Mellissa,

    I’d like to help you, however i have no idea what you are talking about or what your question is.

    Andrew Krauss
    inventRight.com Co-Founder

    Reply

  • Jonathan — June 19th, 2012, 4:21 pm

    Stephen and Andrew,
    1st of all i wanted to say thank you guys so much for answering everyone’s questions for so long! Its truly commendable that you have been replying to this for nearly 5 years. Thanks for all the help
    2nd I applied for a ppa in sept. or 2011 with the thoughts of building a company off of this one product and have since decided that marketing, manufacturing and distribution are not for me (especially after reading your awesome book.) Discovering that licensing will be the perfect option l now feel like i have a ticking time bomb in my hands since i have only 2 and a half months left. Any advice? Do i try and pitch to as many companies as possible or do i let it run out and apply again before i let these companies know of my product?
    3rd Do you have any input on how i can go about making profit from marketing ideas? For example say i was the person to think of the idea of making a Doritos tortilla chip into a taco shell ( #1 selling fast food item of all time.) or something similar that that is not patentable. I think of so many of these ideas but can not figure out how to take action with them

    Thanks again so much. You guys are awesome!
    Jonathan

    Reply

  • Andrew Krauss — June 21st, 2012, 12:02 pm

    Jonathan,

    Yes, one option is to get as much done in 2.5 months and if the idea doesn’t have leg’s you don’t have to worry about spending money for a full patent.

    Another option is to upgrade your PPA to a full utility patent.

    With regards to ideas that aren’t patentable. Try to focus on ideas that are patentable. It sounds like you’ve got no shortage of ideas. Just work on the patentable ones.

    -Andrew

    Reply

  • Heather — July 20th, 2012, 11:14 am

    Awesome post and comments section! I’ve learned a lot from it.

    I’m considering licensing a product and wanted to know if there are companies I should look into that do “bicycle accessories” other than the actual bicycle brands (Electra, Nirve, etc.) I’ve seen at bike shops? This is a completely new product, nothing like it currently. I’m hoping I don’t have tunnel vision, as this is my first foray into inventions and licensing. Are there other companies that I should consider?

    Thanks so much!

    Reply

  • Andrew Krauss — July 23rd, 2012, 8:48 am

    Heather,

    Great question.

    License to companies that have distribution where you want to be.

    Look at more retailers, catalogs and web sites in order to expand your list. If you see them in a store, catalog or web site where you want to be. Then add them to your list. And don’t limit yourself to just what you find locally. Get on the net.

    inventRight Co-Founder
    Andrew Krauss

    Reply

  • Andrew Krauss — July 23rd, 2012, 8:48 am

    Heather,

    Great question.

    License to companies that have distribution where you want to be.

    Look at more retailers, catalogs and web sites in order to expand your list. If you see them in a store, catalog or web site where you want to be. Then add them to your list. And don’t limit yourself to just what you find locally. Get on the net.

    inventRight Co-Founder
    Andrew Krauss

    Reply

  • Robert — October 16th, 2012, 3:00 am

    Hi Steve & Andrew

    Your answers are extremely remarkable and insightful!

    I asked a question on Quora how I could launch a startup without getting involved directly, and an experienced silicon valley entrepreneur suggested I could licence the domain and idea for a percentage of profits or equity shares. The idea behind the domain is potentially disruptive to online contextual advertising. So my question is, does licensing work the same for web/mobile application “services” like product idea licensing? Also, would it be reasonable to negotiate a cash/equity licensing deal? A likely suitor would be a major fortune 500 utility or media company. Not sure if it can be patented.

    Thanks for your kind response.

    Reply

  • Andrew Krauss — October 18th, 2012, 12:30 pm

    Hello Robert,

    It really depends Robert. I need more details.

    Call me at 650-793-1477 and make sure to mention that your posted to 4HWW blog and that i told you to call me.

    I’d be happy to evaluate what directions you might take.

    -Andrew

    Reply

  • Andrew Krauss — October 30th, 2012, 12:53 pm

    Robert,

    It was great talking to you on the phone the other day about your question.

    It seemed like you found my advice helpful. I’m glad we had some time to talk. You can also go so far with written answers in a blog post.

    -Andrew

    Reply

  • Keighan — November 24th, 2012, 7:42 am

    Hi stephen, im a teen father from northern maine with a brilliant invention for the electric guitar/tuning industry. Im pretty intelligent and see a large market for it but i dont know how to go about it. Should i make a prototype before trying to license it? Ive made phone calls but dont seem to ever get calls back from anybody important. Im in desperate need of some help!

    Reply

  • Stephen Key — November 26th, 2012, 9:52 am

    Keighan,

    It sounds like a fairly technical product. I’d suggest making a prototype.

    Regarding calls…. don’t just make calls. Make calls and ask to send your sell sheet and you’ll have more success. Let your sell sheet do the selling for you. Almost no one will return your voice mails. Don’t stress about it. That’s normal. Instead, try to get people live on the line when you can.

    Stephen

    Reply

  • Paul — November 30th, 2012, 11:52 am

    Dear Stephen and Andrew,

    I have been stewing on how to start licensing my ideas for over 10 years. Basically I’ve been afraid of protecting my ideas when pitching them. Your responses on this blog have been a huge help, thank you. There are two things that I haven’t seen asked in the previous questions. I was wondering if you might share your thoughts.

    1) I have an idea to modify an existing computer bag produced by a company for a new use. I can’t find any patent for the existing product. I’m also not sure how to patent my modification. Is it necessary to get a provisional patent for my idea in this type of situation? Or should I just wing it by contacting them? I have documented my idea process in my journal, so I do have some back up.

    2) You often talk about not being able to provide legal advice. How often do you use patent attorneys when licensing? How do you find a good patent attorney?

    Thanks so much.
    Paul

    Reply

  • Wren — December 2nd, 2012, 6:41 pm

    Could you give me more advice about how exactly to procure the name of marketing managers for huge companies?

    Reply

  • Andrew Krauss — December 3rd, 2012, 1:44 pm

    Hello Paul,

    No need to be afraid. Just file a PPA ( Provisional Patent Application).

    If you never show your idea to anyone you’ll end up ripping yourself off.

    Can’t comment on the bag since i don’t know the specifics. Fell free to call me at 650-793-1477.

    We give a whole class on finding a good attorney. But what’s even more important…… is knowing when the right time is to hire one. People tend to pull that trigger too soon.

    -Andrew

    Reply

  • Andrew Krauss — December 3rd, 2012, 1:47 pm

    Wren,

    All the techniques to do that would take a while to go into. However, i will give you one. Try linkedIN.com

    You can often find the names (if that’s all you need) of marketing managers on linkedIN. Then call and ask for them by name. Works great!

    Hope this helps.

    -Andrew

    Reply

  • Tom — December 30th, 2012, 10:35 am

    Very interesting career path! I have a few initial questions though:

    1.) Is there a provisional patent application that can be applied for in the UK? I have googled this but cannot find a straight answer…

    2.) Can a resident in the UK apply for a US ppa?

    3.) If I could secure a deal, would the manufacturer take care of all the design side of things, including the material choices and design of any electronics and mechanisms needed?
    I am an industrial design student and have two very marketable ideas, however I am unsure as to whether I would be required to sell the idea/concept or finished design with fully researched specifications?
    I can at this time create a sell sheet that fully explains the benefit of the product concept and provide and ideation of what it would look like. The ideation however would not be at a level of completion that the manufacturer could instantly put it into production. Would they be able to help fill in the blanks and complete the design?

    Thanks,

    Tom

    Reply

    • Andrew Krauss — January 2nd, 2013, 9:13 am

      Tom,

      Answers to your questions. ….

      1 & 2)
      You don’t need to be a US citizen to apply for a US Provisional Patent. So, I’d just do a US PPA.

      No, there is no UK PPA that i know of.

      Please consult an attorney for more advice. I am not an attorney and this in not to be considered legal advice.

      3)
      It all depends on the product, but the vast majority of the time the manufacturer will work out the manufacturing details. You just need a good idea with benefits.

      -Stephen

      Reply

  • David R. Darrah — March 21st, 2013, 7:36 am

    I have the $125.00 paten for a welding helment that can be used world wide and I want to know how do I approch a company with out them taking my welding helment international?

    Reply

    • Andrew Krauss — April 2nd, 2013, 1:27 pm

      David,

      A US patent only protects you in the US. If you want international coverage, you’ll need to get protection in each country you want protection in.

      Unfortunately it’s very, very expensive to get international patents.

      So you need to decide if it’s worth it or not.

      Reply

  • dustin — April 17th, 2013, 10:27 am

    My question is when talking with marketing managers and sending them the SELL sheet for them to look at your product. Don’t you have to have them sing a NDA or non-compete clause before you show anyone your ideas?

    Reply

    • Andrew Krauss — April 17th, 2013, 11:00 am

      Dustin,

      I get this question all the time.

      Yes, you can go that direction, however you will feel like you are beating your head against a brick wall for the most part.

      Think about it from the companies perspective……

      You are asking them to sign an NDA saying whatever you show them, they need to keep confidential, but they have no idea what you are showing them.

      Don’t you think that puts them in a bad position? What if they are working on something similar?

      Most of our inventRight students file a Provisional Patent Application to protect themselves. It’s only $130 or $65 if you meet the new income requirements.

      A PPA gives you patent pending status. And you can actually write Patent Pending on your sell sheet.

      note: this is not legal advice. See the services of an attorney if you seek legal advice.

      Reply

      • dustin — April 17th, 2013, 11:06 am

        gotcha! that makes sense. Can you do a sell sheet even if you don’t have a name for the product OR your Brand name OR even a MSRP? Because technically if you haven’t even done the prototype you would have no way of knowing how it will be packaged and what it will cost correct? I also wrote you through your website and believe it was directed to you. :) Sorry I’m anxious to get started and try this out.

        Reply

        • dustin — April 17th, 2013, 11:09 am

          Or perhaps I can call you and explain both my ideas and you can suggest the path I take whether it be sell sheet or prototype first. Let me know Any help is much appreciated. I’m ready to move forward!!!

        • Andrew Krauss — April 17th, 2013, 11:14 am

          Hello Dustin,

          Yes, I can give you some advice.

          I do one time free consults.

          Book an appointment with me by visiting my online appointment system at http://www.inventRight.com/411

          Then call me at 650-793-1477 at the time you book.

          Andrew Krauss
          inventRight Co-Founder 

      • dustin — April 24th, 2013, 12:28 pm

        Hey andrew did you get my email? I hadn’t heard back from you about signing up for the coaching course. Please advise.

        Reply

        • Andrew Krauss — May 1st, 2013, 8:58 am

          Hello Dustin,

          Yes, i dropped you an email and also left you a voice mail. Feel free to call me at 650-793-1477.

          Andrew Krauss
          inventRight Co-Founder

        • dustin — May 1st, 2013, 9:07 am

          Andrew,

          I think you may have me confused with someone else. I have no voicemail nor email from you. My email is dmow15@gmail.com and number is 801-641-3629

  • april — April 24th, 2013, 5:11 pm

    Stephen,

    I have always looked at a problem, project or task and tried to figure out a way to do it with products that are marketed to be used for something totally different. Usually to save money. One example I can give you is what I did to a bathtub surround many years ago. There was paneling that looked like tile and the outside layer had started to bubble and peel. I could not afford to do any renovations so I scraped it, sanded where there were noticeable edges, caulked it really well with silicone, painted it with 2 coats of waterproofing paint, (maybe dry-lock, can’t remember) then 2 coats of outdoor house paint. I figured if it could stand up to sun, rain, & snow it should hold up in the shower. You could still see the ’tile look’ through the paint and it was very easy to clean. I was in that house for 5 years after that and it was still in perfect shape.
    I have 2 ideas for products that I use for purposes other than what they are marketed for. Just a few cosmetic tweeks, a change in packaging and marketing . . . Is there a way to protect ideas like this and license?

    Thanks

    Reply

    • Andrew Krauss — May 1st, 2013, 9:00 am

      April,

      I have to give you the answer patent attorneys always give.

      “It depends….”

      It really depends on what you improved and what you are trying to protect.

      Andrew Krauss

      Reply

      • dustin — May 13th, 2013, 12:27 pm

        So is the first step then to ask a patent attorney what you can and can’t patent OR license? All of my ideas are basically small improvements to push to a different market? Or with a simple sell sheet could you approach a company without any PPA? Also in reading stephen key’s book he says that an NDA is always necessary in talking with companies before you present sell sheet. I’m confused as you say it is not necessary and a turn off.

        Reply

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