Factors to Consider When Licensing Your Invention

You have developed a groundbreaking invention and believe that businesses will be happy to pay to use it. This type of confidence brings about positivity and the hope of success, but is not enough to profit from your invention. Many inventors dream of a steady income that comes from their inventions. To make that dream a reality, you will need to pitch to the client and obtain a YES from them.

To do this, you need to do some homework to prepare. An entrepreneur will be more likely to invest in a product if they feel that it has a future, will attract the audience’s attention, and has the potential to churn profits. You need to be well prepared to ensure that your potential client sees potential in your idea. As patent lawyers and agents, we suggest you consider these factors before moving on to pitch to a client:

The Ownership of the Invention

Do you own the invention? If you are the sole person involved in inventing, chances are that you do not need to prove ownership. However, there are plenty of cases where ownership can become muddled. Did you have a co-inventor? Do you have an employment contract that dictates who owns any intellectual property created? Are you a contractor or working for a contractor? Determining ownership and understanding how co-owners may utilize an invention is important. It is important to make sure that all co-owners are on the same page and headed toward the same goals. Trust issues or rifts between partners will not be appreciated by potential licensees.

Legal Protection for the Invention

If your invention is not eligible for legal protection, then it will reduce your chances of licensing it. Patents are granted to inventions that are new, useful and non-obvious. If it is not patentable, then it may mean that it lacks either in novelty or functionality. Consider patenting your invention before you start pitching potential licensees. A patent may act as an added credential and increase your chance of successfully licensing your invention. Patent lawyers and agents can help you in obtaining an issued patent.

Secrecy of Your Invention

While you want to license your invention, you often do not want to lose all the ownership rights to it. The potential to claim a substantial royalty is greatest when you retain ownership of your invention. Additionally, if you seek to patent your invention, non-disclosure can be important. To err on the side of caution, it is preferable to file a patent application before disclosing your invention to a potential licensee. However, where that is not practical, non-disclosure agreements (NDAs) can be used to help retain the confidentiality of the invention. Before initiating the presentation of your invention to a potential licensee, have them sign an NDA. In the event that something goes wrong, the agreement may give you the ability to sue and secure your rights.

Ability to Demonstrate

To successfully turn a prospect into a licensee, a convincing pitch is essential. Preparation will enable you to deliver a confident speech. Having a prototype or a presentation involving sketches or computer models may be beneficial. This can help to create a positive impression on a potential licensee and result in the signing of an agreement.

If you require any assistance in patenting or licensing your invention, consulting patent lawyers or agents will be beneficial.