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

255 Comments


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 27, 2007.

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255 comments on “How to Rent Your Ideas to Fortune 500 Companies: Part II (Plus: Hacking Japan Tips)

  1. 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!

    Like

  2. 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

    Like

  3. 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

    Like

  4. 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.

    Like

  5. 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

    Like

  6. 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

    Like

  7. 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!

    Like

  8. 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

    Like

  9. 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

    Like

  10. 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

    Like

  11. 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

    Like

  12. 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

    Like

    • 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

      Like

    • 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.

      Like

  13. 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?

    Like

    • 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.

      Like

      • 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.

        Like

      • 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!!!

        Like

      • 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 

        Like

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

        Like

  14. 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

    Like

    • 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

      Like

      • 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.

        Like

      • Dustin,

        The first step is not to visit a patent attorney to see what’s patentable. The first step is to study the marketplace and see how your product fit’s in amongst other products in the category of your idea.

        A PPA is your major form of protection when working on your ideas using our approach. You can get them to sign an NDA later when they want more details, however few companies will sign one up front.

        Like

  15. Hi Stephen and Andrew,

    Thanks very much for all of your fantastic advice on this forum. One thing that I’m struggling to understand about your method is when to involve an attorney. Do you recommend involving an attorney when filing the provisional patent application (e.g., for patent searches, etc.)? Or, do you recommend doing your own patent searches for the initial step? I understand that you’re not trying to provide legal advice; I would just like to understand what you would recommend based on your experiences.

    I have an idea for which I would like to file a PPA (using a software like PatentWizard). I’ve done some preliminary searches on google-patents. While I’ve found patents on things similar to my idea, I have yet to find my idea exactly. I just worry that some of the patents for similar ideas may have “all inclusive” language buried within that may cover the domain of my idea.

    Would you recommend involving an attorney or research firm at this point, or would you recommend proceeding with the PPA process independently?

    Thanks very much and best regards,
    Lawrence

    Like

    • Lawrence,

      You need someone to guide you along so you can license your idea. That person is not a patent attorney. Patent attorneys are great, however don’t seek business advice from them unless they are also business experts which most of them are not.

      Like

  16. Hi Stephen & Andrew,

    Thanks for lending your knowledge to all of us going through this for the first time!

    My product is designed and my sell sheet ready. I am based in Canada but I’ll be approaching US companies, should I just file the PPA in the US?

    Also, for the part of product that has IP, I am saying it is “patent pending”…should I just use the term “patented” or do companies really care when initially reviewing it?

    Your help is very appreciated!

    Like

    • Rob,

      I can’t tell you where to file or not to file. That’s a decision you have to make. I can say that most of our Canadian students file a US PPA and then file in Canada if they get interest.

      When you file a PPA(Provisional Patent Application), you can’t and shouldn’t say patented. However, it’s totally legal to say patent pending when you file a PPA. Some companies care if you have an issued patent, however most are ok with pending status.

      -Andrew

      Like

  17. Great article!!!! I have an idea for an improvement to a product that like you said, has not changed in years. I am confused on the process to create this product. I would like to hire a manufacturer and make the revised version of this product and sell it under my own company name. Do I have to have permission from the original patent holder to make my own version of the product. I see so many of the same thing on store shelves, I just wonder how they were able to create and sell a product that is already on the shelf? My product deals with maternity/nursing item and there are 4 or 5 big name companies on the shelf that all have the same design and function. My product has a different design but the exact same function. Do I need to obtain a design patent, or can I just simply manufacture and distribute my product? I hope you can help. Google doesn’t seem to understand my line of questioning. Lol

    Like

  18. Hi Stephen,

    I am impressed by how you kept these 2 posts in fourhourworkweek.com alive through all these years. I actually took hours to read through all the comments you and your co-founder gave.

    Two questions here,

    1) Should I show what I have filed for PPA to the manufacturer? Or do I avoid if possible, so that they don’t exactly know what I have filed? Do I provide sketchy details?

    2) My PPA is abit troublesome to file as it involves chemicals and an existing widely used patent. I am not knowledgable about chemical terms so I am worried that it is easily bypassed. Any advice for this?

    Thanks loads!
    Leonard

    Like

    • 1) Yes avoid if possible, but sometimes it’s ok to show. To big of a topic to discuss in blog comments section.

      2) Quite often you can file your own PPA. However, given your situation I think you’ll need to hire a patent attorney.

      Like

  19. Hi, Stephen/Andrew

    First off, I would like to say thank you for all your great input and advice to future innovators, including myself. :) Ever since I came to stumble upon Stephen’s book, I have been inspired of all the great possibilities and potential licensing an idea could be.
    I have a question that has been on my mind. I have an idea that I really want to sell to a future prospect. But problem is, I am based half a world away from the States. From your experience, is it necessary for the developer to meet in person the prospect? Say, for example especially when it comes to signing the licensing agreement? I am trying to weigh all things in perspective because travelling to the States would be a first time for me and that does require the extra moola. In another scenario, the company(it is a big company) happens to have one of their offices here where I am based, so do you think I could approach someone here?

    Talk soon!

    AJ

    Like

    • AJ,

      You can license products from anywhere.

      Stephen and myself have students in 37 countries. They can and do sell their ideas from wherever they live. No flying required.

      If you have Skype and an internet connection you can do this from anywhere!

      You never need to meet with companies in person. Phone and email works fine. In person meetings are a waste of time. A typical negotiation will involve going back and forth with a manufacturer via email and phone over one to three months.

      Licensing deals don’t get done with one big meeting and handshake. That’s movie stuff. ;-)

      With regards to signing a contract… that can be done via email. No need to fly anywhere.

      Companies don’t care where you live. They just want good ideas. So, no … don’t limit your self to where you live. Make sure to call US companies. All our students do. You should too.

      -Andrew

      Like

      • Hi Andrew,

        First of all a BIG BIG Thank You for your suggestions. This blog can win “The most valuable contribution to make this world a better place to live in” contest. Do participate :)

        I have a similar concern. I have got a provisional patent in Singapore. However, there is no manufacturer in Singapore who can work on my idea and bring it to market. We have only retailer/distributors in Singapore.

        If they will contact their manufacturer in China etc., I don’t know how safe my idea would be there via these distributors.

        If i approach other countries like US sitting in Singapore, where i do not have a provisional patent as well, i think the probability of success goes down considerably.

        Kindly suggest what can be the best way out in this situation.

        This is a Car Accessory product & it’s like “Amazing Solution” to many problems.

        & please continue this thread forever. All the Best !!!

        Varun Mishra

        Like

  20. Dear Mr. Key,

    I have a food storage product that I think will sell great to companies like Glad and Rubbermaid, etc. What do you think about sending each of the companies an email (rather than calling each) and waiting to see if any are interested? Does this method work? Also, some companies (like Walmart) have a “submit your product online” section. Are these effective?

    Thanks in advance for any response regarding sending emails in mass.

    Benjy

    Like

    • With a project like yours it’s important to go for smaller players as well. You need to call in addition to sending emails. Walmart program is more than likely not for licensing, but for people who are venturing.

      Like

  21. Hi Mr.Stephen Key,
    Glad to hear you,I always have hundreds of ideas to invent and build stuff and it could be an option for me to patent/license those ideas. I am from India. In India it is not possible to patent an Idea,here innovation can be patent , but not Idea. My Problem is i can’t make it as real(innovation),because it takes too cost.
    I Have a Mobile network related implementation idea. If mobile network companies follow this idea,they can save crores of money. But i am not able to patent this Idea. Could you suggest me Stephen. Regards, AJAIKUMAR

    Like

  22. I have a Provisional Patent and I have not found a manufacturer company for my new Welding helmet to work with me. Now I don’t care where you are at in the world but if you think you can help me even if we can get them made by hand one at a time we can sell them. David PS if you place my full name into any search Google ect. you can see who I am and get back to me for more details.

    Like

  23. Hi Andrew,

    First of all a BIG BIG Thank You for your suggestions. This blog can win “The most valuable contribution to make this world a better place to live in” contest. Do participate :)

    I have a similar concern. I have got a provisional patent in Singapore. However, there is no manufacturer in Singapore who can work on my idea and bring it to market. We have only retailer/distributors in Singapore.

    If they will contact their manufacturer in China etc., I don’t know how safe my idea would be there via these distributors.

    If i approach other countries like US sitting in Singapore, where i do not have a provisional patent as well, i think the probability of success goes down considerably.

    Kindly suggest what can be the best way out in this situation.

    This is a Car Accessory product & it’s like “Amazing Solution” to many problems.

    & please continue this thread forever. All the Best !!!

    Varun Mishra

    Like

  24. Hey Fellas,

    I have 2 ideas,
    1# is for the digital world.. and to me feels like a little programming code.
    2# is an out of this world idea for the food worlds.

    i just came across this site after a random woman i met after a Dj gig in europe told me about licencing!

    to put this in dot point..

    > make Sell sheet / physical and Digital.
    > file for provisional patent
    > start making calls to the company’s
    > ?

    how long do they usually take to respond?
    do they ask you to go in for face to face?
    if ive covered a provisional in Australia, can i still sell it in the USA or EU.. or should i apply for more Provisional in those territory’s or will the company themselves go cross border if its THAT good of an idea?

    im so happy ive found this blog to help me out.
    Kudos to TIm for posting this up.. im reading the 4 hour work week on the flight home from europe in november.. and want to start implementing and moving on thing right away.. (as i have a fear of making a new resume for the local telecom call centre) lol..

    cheers.
    Andy

    Like

    • Andy,

      You should file a US provisional.

      Regarding your list….
      Don’t forget to make your list of potential licensees.

      I would give yourself three to four months to close out a project. In the meantime while you are calling and emailing to follow up, you should be adding another project to work.

      More projects = more chances for success.

      Like

  25. I have been given a gift of drawling these beautiful characters, I have many of them done over years. I would like to use them to sell products and marketing. How can I do this, Can I put them all in one book and copyright them, or should I categorize them and do this. Also, whom and how would I do this. I believe some of the characters are better than Warner Bros. and Disney characters?

    Thank You

    Kimberly Sparks
    [Personal email address removed]

    Thank You

    Like

    • Kimberly,

      Characters are licensable. However, you need to decide how you want to sell them. For new cartoon show, shirts, mugs, action figures? You need a game plan. Direction you decide to go will determine who you contact and how you pitch them.

      Like

  26. I am a freelance designer, I would like to make Provisional Patent Application for my design works. That are a luxury mobile phone design (out appearance only) and one desktop computer design ( out appearance only). I feel these two design piece are very impressive, I believe that they are going to attract eyes of manufactures.

    Thus, I want to make Provisional patent application for these two designs before I contact any manufactures. However, I’ve made several phone call to USPOT.gov ( The United States Patent and Trademark Office ). They all said ” I can’t apply Art design work for Provisional patent application “, they can only be done through non-Provisional Patent (full Patent Application ), which are very expensive. Is that right?

    In addition, they told me that any Provisional Patent application will take 6 months to 12 months to complete. That’s just too much time for an individual designer to wait. According to your article, the provisional application seem very easy to apply, cheap and fast. However, the office told me they take long time to approve, and can’t apply design work for Provisional patent application? Is that right?

    Like

    • Sounds like you are getting a lot of misinformation or most likely misunderstanding the info you are collecting.

      You are right that you can’t get a PPA on a design. PPA’s are for products or technologies that have utility.

      Instead you would get a design patent.

      Like

      • However, most freelancer designer, don’t have the manpower and resource to apply patent for their art and design. They are too expensive and take to long to get patent.

        Then, how to protect their design works such as car design, architectural design from stolen, when they contact with manufactures.

        Like

      • Independent inventors and designers and everyone else file PPA’s and TM’s and other types of IP all the time. And it didn’t take six months. Took about a day to prepare everything, including drawings, and 15 minutes to submit.

        Seriously. It’s within the reach of many people’s skills who are not IP lawyers.

        Like

  27. Do you have information on how to license training content to companies-thanks. Any information from contracts to how much to charge, to what are things to watch out for are welcomed

    Like

    • Yes, you can license a training program. Licensing isn’t just for physical products.

      Just like when you are licensing physical products, the best thing you can do is license to someone with great distribution. Tapping into existing distribution channels is one of the biggest benefits of licensing.

      Like

  28. Hi Guys

    Love you work – don’t ever stop :-)

    I come up with 2-3 new ideas each week. It’s somewhat embarrassing and annoying that it occupies so much of my brain time, but at least there’s no shortage of creativity or future opportunity.

    In the past year, quite a number of my ideas are ways in which medium/large companies could make massive revenue gains, save large amounts of cash or exploit high revenue opportunities they may not realise are sitting at their doorstep.

    From what I’ve read in all your advice so far, it’s largely physical product based ideas and how to licence them – which is wonderful advice!

    However, given these are more digital ideas, or application of knowledge, how would you recommend structuring some kind of deal with potential target companies? The few I’ve spoken to put it into the ‘oh this is just another consultant trying to make a few bucks’ type deal. Do you have any suggestions for a better structure or way of approaching this to achieve a better outcome?

    Thanks guys, keep up the great work.

    Like

    • You can most definitely license digital products. If you are getting some push back, make sure you have some IP(patents in most cases) and pitch the benefits with what we teach our students to use (a sell sheet).

      Like

    • Rosa,

      Making your list of companies to call is something every inventor needs to do themselves. It’s not as hard as you think. Figure out what retailers you want to sell in, then make lists of the manufacturers selling there.

      That’s you hit list.

      Like

  29. Hey this really helped me, I am 18 years old and I am working on some ideas. my goal is to have my first idea published this year. unfortunately I do not have the money for your course but I am going to do my best through God, your book and my drive. I have big goals for myself and thank you.

    Like

  30. Great information. I have my second appointment with a manufacturer who may be interested in purchasing my idea for a new oil drain plug. Any tips on how I can come up with a reasonable dollar amount?
    Thanks

    Like

    • Lloyd,

      Yes… don’t give them a dollar amount. A buyout almost never makes sense. You’ll want to ask for your royalty over time. So when they sell a unit, you make money. Royalties are usually paid quarterly.

      Like

  31. I want to market/sell my idea to a national home improvement company. I currently spend thousands of dollars as a contractor buying products that I would by from the national chain if they would make some changes. My annual 10k – 20k times thousands of contractors like me, times thousands of stores represents a huge sales potential and I know why I don’t use the box stores for these products.

    Like

  32. Stephen, Andrew, & Tim,
    I am completely astonished at this Q&A on a blog. Almost 7 years of questions. That must be a record.

    I wonder how many of the thousands of ideas and inventions mentioned here will actually see store shelves?

    Thanks for your patience w/all the questions and your consistent advice. I look forward to continue to learn from you.

    Ted

    Like

    • Your welcome Ted. Thanks for the kind words.

      Tim is a friend of ours and past student. We really appreciated his blog post and wanted to help contribute some licensing education to the 4hww community.

      Like

  33. Hi. I kind of have more than one question. First im about to join a non profit organization the mentioned that I should start at small businesses is that a good idea? Second should I call well known companies specializing in my product? And ive drawn a few of my own logos how do I protect them and are royalties given seperately gor each product sold? Sorry for so many questions.

    Like

    • Hello Meka, Yes, your list of companies should be as large as possible. In many cases 15 to 30 companies. The more companies you call…. the greater your chances for success.

      Like

  34. I’m a Canadian with an American design paten and I think its awesome and seems like the weather is helping me . Just wondering which way to go ie. building one or afew and market them. I liked the comment sell 100,000″s or millions something so easy and handy , and lets face it people are getting lazier and lazier and if there is an easier and more efficient way of doing it, enough said. There are similar patens but are for the wrong season. Hope to here back from you guys eh! —-Marcel

    Like

    • Marcel, Licensing is a great way to go! You get to tap into their(company you sell your idea to) money, manufacturing, advertising, sales force and distribution. That’s much better than just raising money! Don’t you think?

      Like

  35. Hi Stephen & Andrew,

    What if my PPA is rather worthless (due to non-engineer and non-attorney me writing it myself), and I’m only filing one to get patent pending status so I can start pitching. I’m not thinking of it as a placeholder at all, because I won’t be able to file a NPA within the year.

    Is this frowned upon? Could it kill a licensing deal? Does the licensee even read the PPA or do they immediately have their own engineers and attorneys draft and file a NPA? What problems could this approach cause?

    Thanks!

    Like

  36. Hello Tim, some truly great advice. I am wondering if I could get a little more info from you. You see, I have an idea for the restaurant giant McDonald’s… And I truly believe that the idea is going to readjust and reinvent the entire business market. Please send me a response..
    P. S. I am not a crack pot, my wife and family usually tell me if my ideas are bad or not, and I have had to stop thinking of ideas that were refused but then I see the logic in the reasoning and I’m ok. I really think that you would find my idea intriguing, and I could really use some good advice, I will make it worth your while.

    Like

  37. Stephen,

    Such great and valuable information here. I’ve enjoyed that I accidentally made some pretty good decisions thus far with my idea. So far I have invested $500 in a provisional patent, drawings and a rough prototype for a police training device. Since I was working in the profession as a custody and control instructor i field tested the product before getting the provisional patent and was very happy with not only its function but the positive feedback I received from other officers and fellow instructors.

    I think that all the information on my next steps have been found in this blog and the comment section. However, my issue lies more with timing. I have just accepted a position to which I am making a career change and am uprooting my family and moving to the other side of the country. The new career will be demanding at the start and time will be scarce. I have from now until September 22nd 2014 to make something happen. I guess my biggest question for you is, if you were in my shoes with this situation and having more experience with how much time it takes to move from provisional patent to licensing, what would you do and is it possible to make it happen with such a short window?

    Al

    Like

  38. I have a patent pending on a 100% unique item that solves the annoying problem of crinkly wrapper noise when someone opens food or candy in a live venue such as the opera, live theater, and symphonies. It’s not a contraption. It’s an elegant design with high-end outside cloths like satin, silk, etc. I am very good at speaking on the telephone and have no trouble getting corporate phone numbers, but have not had any success trying to submit my invention to the top major fashion designers and manufacturers. I get the usual deaf ears and walls from non-decision makers, but I know that getting attention on what I have from the key person and this is an instant hit. Any suggestions?

    Like