Commercializing New IdeasThis is a simple tutorial oncommercializing new ideas and covers information on the following:
✓ The two main ways of commercializing new ideas.
✓ How to bring a product to market yourself.
✓ Selling or licensing your new idea.
✓ How to improve your odds of successfully commercializing new ideas.
|Hollywood and popular literature tend to glorify the selfless inventor who innovates out of benevolence for mankind, with no care for personal gain. However, without the ability to commercialize new ideas, many of the world's most cherished inventions might not have come to pass. Silicon Valley venture capitalist Paul Graham concurs in his essay "How to Make Wealth."
"Developing new technology is a pain in the ass. It is, as Edison said, one percent inspiration and ninety-nine percent perspiration. Without the incentive of wealth, no one wants to do it. Engineers will work on sexy projects like fighter planes and moon rockets for ordinary salaries, but more mundane technologies like light bulbs or semiconductors have to be developed by entrepreneurs."
That is the first thing any inventor must realize: there is no guilt or shame in wanting to profit from your idea. That being said, how do you go about doing it?
As far as we can tell, there are two main ways of commercializing new ideas:
This article will offer tips and guidance on how to make either strategy work for you. The first way, as mentioned, is to nurture your idea to maturity and bring it into the market yourself. The advantage of this strategy is that you control more of the process. If your sole hope is finding a buyer for your idea, you are more or less at the mercy of their whims. What if your idea is sound, but the company you want to sell to just wont bite?
On the other hand, bringing it to market yourself lets you use intelligence and skill to increase your odds. So let's start there.
Bring Your Idea to Market Yourself
The first step in bringing an idea to market is really firming it up in your own mind. Have you determined who your target market is? How will you reach them? Do you know what it truly costs to build your product? Do you even know how to concretely build your product, starting from nothing but raw materials? Our article "5 Steps to Patent Ideas" gives you a checklist for answering these questions. Consider this your starting point.
Once you have these things figured out, the next step is recruiting people to help make your vision real. Of course, this can be a risky process, as each person you tell about your idea increases the odds that someone will leak it into the wrong hands. Our article "Discussing Invention Ideas" reduces the "who to tell?" question to hard and fast rules you can easily follow.
Still, just knowing who it is safe to tell won't magically get the talent you need working on your invention. Once you have found someone you want to work with, you need to make them see the potential. One tried-and-true way of attracting talented people to new projects is offering them stock, or a percentage of future profits. An even better method is combining this approach with a salary, however small. This will help you find the people you need to actually create your idea.
Once it is created, you can roll out your idea in the manner you see fit. Want to sell it online? Want to sell it in retail stores? Want to do both? With a finished, tangible, honest-to-God product to sell, you have the ability to start making these things happen for yourself. Most of the popular retail outlets have buyers who you can talk to about getting your products sold. Selling online is simply a matter of setting up a website and publicizing what you have to offer. By this point you have firmed up your business plan and are intimately aware of what it takes to produce and sell your invention.
Again, the key benefit of this approach is that you are in the driver's seat for important decisions. Another option that offers less control but also less stress is selling your idea to others.
Selling/Licensing Your Idea to Others
The chief benefit of selling or licensing your idea is that not everything is riding on you. Some people are not cut out for the task of inventing, creating, marketing and selling a product themselves. It is hard, long, diligent work that you simply won't do if your heart isn't 100% in it. Therefore, selling or licensing your idea to others can be an attractive option.
However, be warned that this approach is often made to seem far sexier and easier than it is. Many idea listing and marketing services are scams. They have been investigated (and some even shut down) by the Federal Trade Commission for charging scandalous fees and delivering no real value. The worst of these companies will actually steal your idea.
If you are serious about your idea, speak to a patent attorney or file a patent application yourself. This gives you the protection and leverage you need to approach someone about selling your idea. Furthermore, you do not want to start blasting unsolicited "do you want to buy this idea?" letters to every company in the industry. What you want to do instead is whittle down your options to carefully chosen handful of companies who have a pressing need for what you have to offer.
Our article "Presenting Patent Ideas to Companies" offers no-nonsense advice on how to do this research and present your idea in a desirable way.
In closing, these are the two main ways of commercializing new ideas. You should give some thought to which approach reflects your strengths and weaknesses as an inventor and pursue the course that feels best.