Now What? Phase Four
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.
Step Ten: Generate Interest
Time: 30-50 Hours
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:
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
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
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.