There were close to 800,000 patents granted last year around the world, according to the latest government agencies that track the statistics and information about these patents.  The top categories were computer technology, electrical machinery and equipment and telecommunications.  And, digital communications just barely fell out of the top 10 in the latest year, but has been higher in past years among all types of patents.  Medical technology and pharmaceuticals are also in the top 10 industries or market segments around the world with active patent applications and awards.  Historically, at least in the U.S. investments in medical research and pharmaceutical product development have always been at the forefront of patent awards. The latest data suggest that this trend continues.  Patents and inventions tend to follow the most popular business and economic trends. Or it may be the other way around. The inventions and innovations included in the patented products help to spur growth in these key areas.

What types of patents are included in these latest statistics?  If you have a new idea or invent something, what kind of patent should you apply for? The U.S. Patent and Trade Office (PTO) patent applications fall into three large categories or types.

Utility Patents

First, there is what’s known as a Utility Patent.  This type of patent is generally issued for the invention of a new and useful process, machine, manufacture, or composition of matter. Patent applications can also be files for a new and useful improvement on an existing process.  When granted, these types of patents permit its owners to exclude others from making, using, or selling the invention for a period of up to twenty years from the date of patent application filing.  Continued patent protection for that period is contingent upon payment of maintenance fees to the PTO.  Approximately 90% of the patent documents issued by the PTO in recent years have been utility patents, also referred to as “patents for invention.”

Design Patents

The second group is called Design Patents.  These are issued for a new, original, and ornamental design for an article of manufacture.  If you design a new way to put together an artificial Christmas tree, for example, you can apply for a patent on that design.  Similar to Utility Patents, the Design Patent permits its owner to exclude others from making, using, or selling the design.  But that protection on the design is for a period of fourteen years rather than the 20 years with a Utility Patent.  Another key difference is that Design patents are not subject to the payment of maintenance fees.

Plant Patents

The third large group is called Plant Patents.  These are issued for new and distinct, invented or discovered asexually reproduced plants including cultivated sports, mutants, hybrids, and newly found seedlings, other than a tuber propagated plant or a plant found in an uncultivated state.  This patent permits its owner to exclude others from making, using, or selling the plant for a period of up to twenty years from the date of patent application filing.  And, like a Utility Patent, Plant Patents are not subject to the payment of maintenance fees.  Basically, the Plant Patents are the alternative used by growers, plant enthusiasts, and others instead of a Utility Patent. The concept is similar, but Plant Patents apply to unique and distinct plants rather than products or services.

Other Types of Patents

Outside of these three main types of patents, the PTO also issues or awards patents for a few other reasons, basically to correct errors or offer inventors more limited protections.  The Reissue Patent is issued to correct an error in an already issued utility, design, or plant patent.  Once awarded, it does not affect the period of protection offered by the original patent based on the original date of issue.  There is also what’s known as a Defensive Publication (DEF) or what is now known as a Statutory Invention Registration (SIR) issued by the PTO.  These – and the DEF has been phased out or replaced by the SIR – offer more limited protection as inventors and innovators discover or create new ideas and products. These last two are intended to be defensive in nature and provide a way for an inventor to prevent others from using or patenting the same idea, design or plant.

Provisional Patents

In addition to these key types of patents, and the market segments where they are most important, we are all familiar with the term “patent pending”.  The PTO grants patent pending status to an invention, design or new plant when a provisional application is filed.  Basically, the inventor or creator of the new product or idea submits an application to the PTO that temporarily prohibits someone else from using the idea.  Once the provisional application is submitted, the invention can legally be labeled as “patent pending”.  While this does not offer the same level of protection as an actual patent – only one person can be awarded a patent for an invention – the process does discourage others from trying to copy the idea.  Patent pending status is intended to protect inventors and their inventions while a more formal patent application process is being completed.

Summary

There are three main categorical types of patents. You will need to consult with a patent attorney to determine the best type of patent to file for your invention. Not only does it take time to create and invent and be innovative, but it takes time to file all the right patent documents as well – for all types of patents.

Patent Idea Licensing: Royalty Rates
One of the most important steps in licensing a patent or idea is establishing the royalty rate you will receive in return for granting a licensee the right to manufacture and sell your invention. In this article we will explain what royalty rates are, how to calculate the proper royalty rates, elements that effect royalty rates, protections to put in place, and other important things to consider when licensing an idea.

What are Royalties?
Royalties are payments that are provided to a licensor by a licensee in exchange for the right to operate under your idea.

Royalty rates are affected by several criteria:

Exclusivity is when a licensor gives a licensee the exclusive right to market and sell a product by intellectual property.

Non-Exclusivity is when an intellectual property holder provides the right to market and sell a product to a licensee but retains the right to license it to others as well.

Exclusivity can be further broken down to regions or specific locations as is the common practice with franchises. The proper route often depends upon how a product will be delivered to the customer, the demand for the intellectual property, and the market size.

Protections for Idea Licensors:

1. Performance Obligations
2. Void Agreement
3. Exclusive to Non-Exclusive

Performance obligations protect an inventor from getting stuck with a dud of a licensee. You will want to include these provisions in your idea licensing agreement that ensure certain milestones are being met. These milestones can be distribution in a number of stores, sales targets, royalty totals, or best efforts being made. If performance obligations are not met, an agreement can direct for a number of actions to occur. Such actions could include but are not limited to a voiding of the agreement, financial compensation, or for the licensee to switch from exclusive to non-exclusive license.

Licensing to a Company Infringing on Your Idea:

Often times, idea licensing takes place after it has become apparent that intellectual property is being infringed upon. This can be a sticky situation given that if the parties do not come to an agreement, it can often end in costly and lengthy litigation. As a note to inventors, it is important to keep in mind the overall short term and long term costs to litigation. While it may seem like a card to play, be careful not to send willing parties away from the table without giving negotiation a good faith effort.

Note:  It is important to note that royalty rates and damages determined by the court are generally higher. However, avoid litigation if you can – it often ends up ‘costing’ you much more than you anticipated.

If you do get into a position where a company that is infringing upon your intellectual property is unwilling to talk or to come to a reasonable agreement, you may want to consider partnering with a idea licensing law firm that may be able to command more respect at the negotiating table.

How to Command Higher Royalty Rates and Upfront Idea Licensing Fees:
- High tech invention ideas.
- Inventions that solve costly problems.
- Inventions that provide large benefits.
- Has already met industry testing requirements.
- Has already met industry certification requirements.
- Commitment for purchase orders.
- Existing sales.
- Lack of suitable substitute products/technology.

We will be continually updating this article with information on royalty rates. If you have any questions, feel free to contact us by our contact for or email us at info@ideabuyer.com. As always, we ask that you sign up for our newsletter for ongoing tutorials.

How to Sell an Invention – 10 Steps

This article discusses how to sell an invention in ten steps.
1. Conduct Market Research
- Substitute Products
- Retail Price Spectrums
- Market Growth
- Realistic Distribution Channels
- Average Time to Market for Similar Products/Inventions
- Recent Success Stories in the Market
- Analyze the Potential Market Demand (Be Realistic)

2. Know Your Product
- The invention should be engineered.
- You should have a functioning prototype or proof of concept.
- You need to know how much it will cost to be manufactured (Wait for formal quotes until you are protected).
- You need to know what your anticipated margins are.

3. Get Feedback from Those You Trust – Not Your Family and Friends.
- Check out SBDC or SCORE.gov to find local mentors and coaches that the government pays for.
- Vet your idea out with mentors, fellow inventors, or trusted entrepreneurs.
- Do not get offended by critical comments or too flattered by positive comments. You can learn a lot more from critical comments than positive ones. These are often issues that customers may have and issues that friends and family might not tell you.
- It is very likely that the invention you end up selling will be much different than the one you originally conceived. This is OK.

4. Decide at this stage if it’s worth protecting. Some inventions will not be. If you find out it will be a dud, kill it early.
- Read our article on, “Kill Bad Ideas Quick”, here;http://www.ideabuyer.com/news/kill-bad-ideas-quick/

5. If you decide to continue, protect it with a patent attorney.
- We offer discount patent services to our members. If you would like to inquire, contact us via email at contactus@IdeaBuyer.com or by phone; 832-683-1527.

6. Put Together a Business Case
- How will your product idea benefit those who help you?
- How will it fit into their current product spread?
- How do you propose you will work together? What is your proposal for a working relationship?

7. Prepare Your Materials in a Professional Manner
- Color printed, bound.
- Professional Power Point
- Professional Website
- Deal Profile.
- Proposal Outline.

8. Know Your Audience
- Research the companies you feel would be interested.
- Identify specific contacts within those companies.
- Prepare for your calls.
- Be polite and considerate of others time.
- Keep your pitch short and ask if  you can send additional information.
- Accept feedback positively.

9. Be Prepared to Make or Accept an Offer
- Know what you are looking for in regards to a licensing %.
- Know what terms you would like in the agreement to protect yourself.
- Be prepared to accept or reject exclusivity.
- Don’t be greedy. Think about the BIG picture.

10. Repeat Steps 8 & 9 for Additional Companies.

Eric Corl is the founder and President of Idea Buyer LLC, an Ohio Limited Liability Company. Idea Buyer LLC runs and manages http://www.IdeaBuyer.com – The Online Marketplace for Intellectual Property. You can email Eric directly at EricCorl@IdeaBuyer.com. If you have questions about bringing your product to market, feel free to ask us.

Our world has been greatly impacted by the success of Apple Computer. From their original computer to the IPad, Apple has a rich history of innovation. For many inventors, the story is too big to relate to. Untouchable. Yet, the founders of Apple (Steve Wozniak and Jobs), started off just like you………

Steve Wozniak: How I Invented the Personal Computer

IdeaBuyercom is now on Twitter. If you are an avid twitter user or beginner, sign up to receive our tweets on commercializing your intellectual property!

http://twitter.com/IDEABUYERcom

Stop Whining and Start Winning!
“I do not fear failure. I only fear the “slowing up” of the engine inside of me which is pounding, saying, “Keep going, someone must be on top, why not you?”” – George Patton

It is not until a man gives up that he is a failure. Failure is simply an event. Failure can serve us greatly if we utilize its lessons and continue moving forward. For those of you that have allowed the past 11 months since the New Year beat you down and withdraw your enthusiasm for your goals, pay attention.

No one is born a great inventor. Great inventors become so through years of hard work, dedication, and sharpening of their saw.
Successful inventors study the markets they invent for, build contacts, and partner with individuals who can help them take their product to the next step. They utilize their capital wisely, investing in materials and services that are value based and help them build their networks.
One thing they do not do is give up. This isn’t to say you should never let a product go. What it means is that you should never stop inventing, educating, and taking massive action.
This past week I had the opportunity to speak to a very intelligent and motivated inventor named Lisa. Her last invention flopped after she spent a large chunk of her money on patent services before she had a chance to really get started.
While most people, rejected, would feel defeated and give up. Many would think, “maybe this just isn’t for me. Maybe I am not cut out for this”.

Not Lisa. Lisa learned from her mistakes, built up her coffers, kept her journal, educated herself further, and is currently in talks to license her patent pending product. We also had the opportunity last week to get two new products into retail locations where they will begin selling. Collectively, the inventors have been working on their inventions for over 5 years and their persistence is paying off.
The will of the human mind is the greatest gift a person is given.
The human mind is what can help people get through atrocious events like the Holocaust.
Your mind, like a tree, can only grow stronger when it is challenged by the weather of life.
If a tree is insulated against nature, its trunk stays week. It does not grow stronger. Eventually, if it is planted alone, it often snaps during turbulent times and dies.
Let the storms and weather you face serve you in your inventing career.
Think about how you can take control back and fire up that engine inside of you. That engine that says;
“I do not fear failure. I only fear the “slowing up” of the engine inside of me which is pounding, saying, “Keep going, someone must be on top, why not you?””
- George Patton

Best,
Eric Corl

Eric Corl is a serial entrepreneur and the founder of Idea Buyer LLC, a new product development company which operates IdeaBuyer.com. You can email him at EricCorl@IdeaBuyer.com.

Idea Buyer – Inventions then and now –

In inventing, few ideas are more comforting – and more dangerous – than “someday.” To the inventor with a product in mind, the concept of “someday” becomes a security blanket, allowing him to endlessly theorize about his idea and safeguarding him from responsibility for bringing it to market. After all, if you start now – the reasoning goes – any number of things could go wrong…and then your product might fail. Or perhaps friends and relatives denounce inventing as a frivolous hobby. So instead, the wait for “someday” continues, and the project is postponed until the inventor finally musters up the courage to see his product as a defensible goal worthy of serious pursuit. But for some inventors (perhaps many),”someday” never comes. So what happens to them? This is a question worth exploring.

Well, for one thing, they don’t become failures. In this narrow sense, their decision to indefinitely wait has succeeded in making it absolutely impossible to fail. But is this really something to be proud of? Only by Homer Simpson’s cynical “I find that trying is the first step toward failure” logic can this be considered a success. The truth is that most inventors who don’t try are not happy with their decision. Some try to forget about it by consciously avoiding thoughts of the dream they did not pursue. Others experience regret more intensely, living each day with the deep awareness that they gave up on themselves. It’s not a fun feeling, and for some it never fully disappears.

But enough psychologizing. I think we can safely assume that you don’t want any of that. You would rather know that despite all risk, uncertainty or criticism, you gave your invention an honest-to-God chance. Perhaps it isn’t fear holding you back, but simple confusion about where to start. After all, conceiving of an entirely new product, developing said product and bringing it to market is hardly a routine matter. It is very tempting to look at such a lofty goal and conclude “little old me could never do all of that.” However, this is exactly the type of fearful thinking that “someday” feeds off of. If you are going to make a serious go of this, you need to replace that thinking with bold practicality. Instead of succumbing to complexity, determine specifically what a given thing actually requires you to do. This nearly always involves breaking down huge goals like “develop my product” into smaller steps that do not boggle the mind.

With this in mind, IdeaBuyer would like to offer the new or timid inventor a “roadmap” that will make the huge goal of new product development less intimidating. Think of these steps as stages that any successful inventor passes through. As you read them, ask which stage you are currently in what it would take to keep going.

Step 1) Define your product

Step 1 is where inventors consumed by the “someday” bug never depart from – defining your idea. Nevertheless, it is the critically important step that forms the foundation of everything else. If your product exists in your mind as a jumbled mess of “neat ideas” or things that would “be pretty cool”, it will be tough for you to focus or advance the idea in any meaningful way. The reason is that our brains rely heavily on schemas to motivate us and keep us moving. It has been proven, for example, that students who see college as the centerpiece of a passionately sought-after career of their choosing get better grades than those who simply see college as a vaguely important chore. For the same reason, inventors who begin each day with a crisp, clear vision of what they are trying to create have an inestimable advantage over those less certain.

It therefore pays tremendously to define your idea as best you can at this early stage.

Step 2) Determine demand for your product

This step is somewhat less fun, but just as crucial as the first. You must determine whether there is demand for your product. The reason, simply enough, is that even the best product won’t sell if nobody wants to buy it. And few things are worse than pouring months or years into creating something with no demand. Luckily, there is an effective way to reduce this risk – market research. IdeaBuyer has an extensive, free article on that here. Read it and follow its advice.

Step 3) Patent your product
If your product survives the “market research test” – that is, you can give plausible reasons why people want it and identify who those people are – the next step is filing for patent protection. Be careful however! Work with a patent attorney who has experience working with products in your industry and steer clear of the large invention marketing companies so eager to charge you to review your invention.

Step 4) Develop a prototype of your product
The next step following patent protection is to develop a prototype of your product. Understandably, this is something you may or may not be able to do yourself. Not every inventor possesses the skills to literally create what he envisions from physical materials and drawings. Fortunately, this is not necessary. There are firms you can hire to do the bulk of this work for you, under your guidance and according to your specifications. IdeaBuyer’s “Turning Ideas Into Profits” and experienced engineers can draft up industry-standard technical drawings and develop physical and virtual prototypes based on them. This is when your idea begins to really take shape.

Step 5) Decide upon a commercialization strategy for your product
When it comes to inventing, there’s more than one way to skin the cat. Many inventors wish to carry their product all the way through completion and get it onto store shelves. This is a perfectly good strategy and one you should certainly investigate. Other strategies include licensing your patented product to someone else (say, a manufacturer or retailer) who will do all of that themselves and pay you royalties. Should the latter strategy appeal to you, visit our article onPatent Licensing and learn more about the process. For all others, continue on to steps 6 and 7.

Step 6) Find a manufacturer (if your strategy is to sell product in stores)
Finding a manufacturer to mass-produce your invention is no simple task. A new inventor with little or no industry experience may feel overwhelmed by the sheer newness of this goal and lack a firm direction on how to accomplish it. Our engineers can assist with prototype development and have valuable, long-standing connections with manufacturers who can produce your invention on a wide scale.

Step 7) Sell the product
Finally, it comes time to sell the product, either online, in stores, or otherwise. This too can seem bewilderingly complicated, but remember to think pragmatically – what does it really involve? IdeaBuyer has a free article called “Getting Your Invention on Store Shelves Within 30 Days” that begins to answer this question. We recommend everyone check it out before getting started on this step. Of course, IdeaBuyer also works one-on-one with inventors on connecting them with interested retailers and manufacturers. We are happy to talk with anyone who thinks their invention might be ready for prime time.

Someday is not a day of the week
Above all, remember our earlier discussion about someday – and remember that it is not a day of the week. Those who stake all their hopes and dreams on “someday” typically find that life has passed them by, leaving little more than longing for what might have been. Don’t be one of those people! Instead, use this road map as your guide, and remember these timeless words regarding criticism and big dreams.

“It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.”

- Theodore Roosevelt

One seldom-discussed but important aspect of inventing success is having good technical drawings. A technical drawing varies from a simple sketch or layman’s drawing in a notebook. While these are helpful in the early stages of conceptualizing, a technical drawing is a much more detailed visual representation intended to “concisely and clearly communicate all needed specifications to transform an idea into physical form”, according to Wikipedia.

This becomes important when it comes time to develop a working prototype of your invention, and especially when it comes time to mass-produce it. The crude “notebook” drawings you sketched up yourself won’t be accepted or usable by a manufacturer. Without detailed technical drawings that a manufacturer can take into his hands and understand, you most likely will experience serious delays and costly errors. So let’s explore in more detail what technical drawings are, how they will benefit you, and how you can attain them.

As noted, the main people who will be creating and using technical drawings of your invention are engineers. The main difference between technical drawings and other drawings is the degree of standardization. Rather than simply sketching your invention, an engineer drafting a technical drawing will meticulously draw it out in accordance with industry-wide standards for everything from layout, line thickness, symbols, descriptive geometry, text size, notation, dimensioning and view projections. This means that any similarly qualified engineer can look at your technical drawing and understand exactly what it represents with minimal explanation from you.

An example of a technical drawing (an engineering drawing, in this case) for a machine tool is shown below:

Engineered drawings such as these unambiguously represent the proportions and dimensions of the invention. Every angle, nook and cranny of the invention is described in terms of length, height, and scale indicators that any engineer will immediately understand.

However, engineered drawings are not the only kind of technical drawings useful to an inventor. Another commonly used drawing is known as the cutaway drawing (shown below). The main purpose of the cutaway drawing is displaying your invention in 3D form – rather than flattened out – but opaquely, so that the inner workings of the invention are still visible. Drafting a cutaway drawing enables an engineer or manufacturer to get a better picture of how the invention should look in its finished state.

Still another kind of technical drawing that often proves valuable to inventors is the exploded view drawing. For inventions that contain a lot of moving or inter-locking parts (such as the gear pump pictured below), an exploded view drawing captures the interconnectedness of these components and the exact way in which they fit together to form your completed invention. Without an exploded view drawing, you are left explaining these complicated inter-relationships verbally, which rarely captures the subtle nuances of how it all has to work in practice.

In addition to physically creating your invention, technical drawings come in handy when filing for patent protection. If you do apply for a patent, you will be required to submit what are known as patent drawings (see our article on the subject), that visually convey your invention in much the same ways as you have seen here. Getting technical drawings done early on will be a serious time saver when applying for patent, because you can use these as your patent drawings.

It used to be that a drafter or engineer would create these drawings out manually, using drafting boards, protractors, and triangles, pen and paper to get the job done. Naturally, this was a rather error-prone process that did not always convey the object effectively. Today, the whole process of creating technical drawings is much more streamlined. Using computer-aided design programs like AutoCAD, a skilled engineer can depict your invention on any or all of the technical drawings above with total precision and accuracy.

In addition to AutoCAD, another program commonly used to create high-quality technical drawings is SolidWorks. The main benefit of using a program like SolidWorks is that it lets you specify a feature (or several features) of your invention and hold that feature constant regardless of other changes you make to the design. Wikipedia offers a practical example:

“For example, you would want the hole at the top of a beverage can to stay at the top surface, regardless of the height or size of the can. SolidWorks allows you to specify that the hole is a feature on the top surface, and will then honor your design intent no matter what the height you later gave to the can.”

The benefit to you as an inventor should be clear. Beginning from a simple 2D sketch, an engineer can use a program like SolidWorks to draw out your invention with its features (pumps, hooks, handles, or what have you) as the foundation, making changes to the size, shape, or texture while ensuring that the critical features of the invention remain prominent and intact throughout. This, in turn, enables you to visualize what your invention would look like in different shapes and sizes before it physically exists.

SolidWorks also contains simulation technology that allows your engineer to see how a certain design would behave as a physical object. (For instance, whether your invention will lose durability at a given size or weight can be gauged using simulation.) Designs deemed problematic or cumbersome are then abandoned on the computer screen, at relatively low cost, rather than after being physically created.

Another helpful feature of SolidWorks (which some other programs have since copied) is the ability to “roll back” through every drawing of your invention that exists. For example, let’s say you have ten drawings created of your invention at various stages of its development. Chances are that each of these drawings contains different features, sizes, geometric dimensions and other differences from the drawings before or after it. However, because of the rollback feature, you or your engineer can quickly and easily modify an older drawing in any way deemed necessary without messing up the other drawings.

A typical drawing created with SolidWorks – of a stapler, in this case – looks something like this:

Need technical drawings of your invention?

Idea Buyer LLC recommends Patent Help Now for inventors seeking professionally-crafted, industry-standard technical drawings. Using SolidWorks, PDC’s team of experienced engineers utilize a time-tested, five-step process beginning with a basic surface model and ending with a comprehensive technical drawing that a manufacturer can take into his hands and create your invention with. The process typically encompasses 4-6 weeks and involves the following steps:

Step 1 – Engineering/3D CAD Development: The first step involves creating a 3D product surface modeling of your invention similar to the 3D car drawing shown earlier. At this stage, PDC’s engineers will also conduct a critical analysis and simulation of your invention’s design, looking not merely for what “might” or “would” work, but for the best, most cost-effective design possible.

Step 2 – Structural Analysis: With a professionally designed 3D product model in hand, the next task is to conduct what is known as a finite element analysis (or FEA) on that design. In a nutshell, this involves running a number of simulations and stress tests to determine how your invention (as laid out in the 3D model) will respond to stresses, strains, and reaction forces. Will it break if someone pushes it too hard? Will it hold up under heat? How will it react to repeated use? These and other questions are answered definitively in this stage, as the overall structural integrity of your invention is rigorously tested by PDC’s engineers. Your invention will also be assessed in terms of its weight, with an eye toward eliminating needless bulk and size.

Step 3 – Virtual Prototyping: Once your 3D product model has shown itself to be reasonably stress-resistant, a virtual prototype is developed based on that model. Essentially, this involves optimizing the model created in step 1 and validated in step 2 so that it can be created using the most cost-effective manufacturing procedures and materials. The end result of this step (from your perspective) will be an interactive 3D image that you can twist, turn upside down, zoom in or out of and see from every angle in as much detail as you wish. Manufacturers actually prefer to receive prototypes in this format because it is easier to rework a virtual prototype than a physical one. It also makes for easier communication between you and the manufacturer.

Step 4: Form Fit Function Testing: All that remains after virtual prototyping is subjecting the prototype to Form Fit Function tests. Very simply, form fit function (or F3 in engineering-speak) encompasses your invention’s identifying characteristics. Wikipedia defines each of these as follows:

Form refers to the “shape, size, dimensions, mass and/or other visual parameters which uniquely characterize an item. This defines the “look” of the part or item. Sometimes weight, balance and center of mass are considerations in form.”

Fit refers to “the ability of an item to physically interface or interconnect with or become an integral part of another item or assembly. This relates to the associativity of the part in relation to the assembly, or to other parts, and includes tolerances.”

Function refers to “the action[s] that an item is designed to perform. This is the reason for the item’s existence, which also includes secondary applications.”

This step, then, involves ensuring that the virtual prototype created in step four includes each of these things and that any manufacturer or engineer can clearly discern them by looking at your technical drawings.

Step 5: Final analysis: When each of the first four steps is complete, a final analysis is performed to ensure that everything has been done correctly, according to standard and without oversights. Loose ends are tied up and the end result is an invention ready to be created by any manufacturer willing to do the job.

Do you feel like you have worked so hard to move your invention along, and now you are just stuck? Do you just need some guidance as to where to go from here?
Hopefully this newsletter series has helped you to understand the normal progression of the invention process, while helping you figure out where you are and what you need to do in order to move forward.
The 12 steps were broken down into four phases:

Phase One: Research

Phase Two: Development & Realization

Phase Three: Presentation Material

Phase Four: Pitching to Companies

Each week our newsletter has covered a phase in this process. Following the process should save you time and money, while greatly increasing your chances of success.
This week we explain the last phase of the process, pitching to companies. If you have missed a phase of this series, you can find the articles archived here.

Phase Four

Step Ten: Generate Interest

Time: 30-50 Hours

Money: $3,000-$8,500

Now that you have all of your pitch material compiled, it is time to generate interest. This process has two steps: 1. Generating interest among potential customers and 2. Generating interest for the sale of your patent.
The goal of the first step is to get potential customers excited about your product. Ultimately, you should aim to walk away from this process with letters of intent or purchase orders. Any LOI’s or pre-orders will greatly enhance your position when trying to license or sell your patent in the next steps.
Press releases should be sent out to publications with readers that are in your target audience. Many publications have “New Product” sections where a spotlight is given to products that would be of interest to readers.
Interest in your patent can be generated through advertising that your patent is for sale. Again, it is important to advertise in places where the people you are targeting, are going to read it. Online marketplaces like, IdeaBuyer.com, can help you to promote your patent to people who are looking for intellectual property. For instance, your patent on a home product would be best advertised to individuals looking to purchase or license patents specifically in home goods. IdeaBuyer.com allows Entrepreneurs, Retailers, Manufacturers and Distributors to choose which patent listings they would like to be informed of. As a medical supply company, it is likely that their interest is only in patents regarding their same field.
Don’t forget to think outside of the box on places to advertise:

• Magazines
• Newspapers
• Craigslist

Although, it may seem unusual, the key is to ADVERTISE IN PLACES WHERE YOUR TARGET AUDIENCE WILL BE EXPOSED.

Step Eleven: Contacting Companies

Time: 30-60 Hours

Money: $2,000-$4,500
Before making contact with any company, be sure to refer to your market research regarding which companies to contact. Of the several companies that you may feel would be a good fit for your product, choose the five with the most potential to contact first.
*By starting with only five companies, you will have fewer conversations to manage.
When you decide to make contact, use the method of communication that they prefer. Email will typically be the best form of initial communication for most professionals. However, it may be necessary to contact the head office in order to find the name and contact information of the person you need to contact.
(For step-by-step in-depth information on contacting companies, please see A Foot in the Door, our guide to contacting companies.)

Step Twelve: Sign a Deal

Time: 20-30 Hours

Money: $750-$6,500
As you begin negotiations, it will be important to not let the excitement get the best of you! Hiring someone to help you through negotiations is highly recommended.
Benefits of hiring negotiation help:

• You are not alone! Imagine being in a boardroom all alone, trying to talk to ten people all while attempting to understand the terms of the agreement.
• Now, it’s two against ten! You have someone on your side to make sure you understand all terms of an agreement correctly.
• You get to be the good cop! When hiring someone to handle negotiations, they will be the person to play bad cop in order to get you a good deal!

Food for Thought from Past Articles:

• When you license a patent, the first decision should be whether it will be an exclusive or non-exclusive license. In general, people looking to license your patent will prefer an exclusive license. This way, they will be the only ones allowed to profit from the patent, and have the right to enforce violations of it if anyone tries to “copycat” what they end up bringing to market. However, you may prefer a non-exclusive license.

• As the name suggests, a non-exclusive license grants someone rights to utilize the patent, but on the understanding that you may license those rights to others as well. For obvious reasons, potential licensees do not usually like this kind of licensing deal. It creates the threat of competition in the future that will make their lives harder. However, some licensees will agree to this, and it would be advantageous to try and work out such a deal.

• One of the biggest fears you may have as a patent holder is “What do I do if the licensee fails to capitalize on the patent?” Not every licensing deal works out as hoped, and this is a reality you must in some way face. Therefore, you may want to write certain requirements into the contract so that you can revoke the license if this happens. These are called performance obligations, or milestones. Simply put, you can write sales targets, profit margin expectations, or just about anything else that both parties agree on into the contract. If the other party does not meet these obligations, you can revoke the patent.

• Another way to ensure that your financial needs are met is to simply use royalty requirements. Under this approach, you do not require them to capitalize on the patent in any specific way. Your only concern (and the only thing written into the contract) is that by X date; you want to start receiving Y dollars in royalties on a monthly, annual, or semi-annual basis. This might be worth looking into if you want to get paid, but don’t want to be hassled with figuring out what reasonable sales or profit targets are.

• Signing does not necessarily mean all of the work is over. You should be continuing to manage the relationship with the buyer or licensee of your intellectual property, to make sure that the agreement is being fulfilled.

**We now offer discounted patent, prototyping, and engineering services to our members. For more information, you may contact us at 832-683-1527.

For more information on this newsletter series, or if you are looking for help moving your product forward, please feel free to email me at: Lindsey@IdeaBuyer.com
Recommended Service Providers and Resources for Phase Four:

• A Foot in the Door – Company Contact Workbook
• IdeaBuyer.com – Start Networking with Companies and Create a Listing!
• Five Key Networking Tips for Inventors
• How to Sell a Patent
  

Lindsey Yeauger is the Product Marketing Director for Idea Buyer LLC, a new product development company that owns and operates IdeaBuyer.com- The Online Marketplace for Intellectual Property. The site gives inventors the opportunity to showcase their intellectual property to consumer product companies, entrepreneurs, retailers, and manufacturers. You can email her at Lindsey@IdeaBuyer.com.