How to Monetise a Patent

You have several choices when it comes to monetising your patent. Which one you choose and is right for you depends on you, your resources and objective.  

Manufacture and Sell the Product

Production Setup : You can either manufacture your invention yourself or license it to a manufacturer. Setting up a production facility involves designing prototypes, sourcing materials, and handling logistics.

Marketing and Sales : Once the product is ready, develop a marketing strategy (online presence, trade shows, etc.) and sell directly to consumers or through retailers.

Distribution Channels : You can sell your product via your own website, online marketplaces (e.g., Amazon), or partner with brick-and-mortar stores.

Costs : Manufacturing costs, shipping, marketing, and distribution must be accounted for, and you'll need a solid pricing strategy to ensure profitability.

Licensing Your Invention

License to Other Companies : Instead of producing the invention yourself, you can license it to a company that has the infrastructure to produce, market, and sell it.

Royalty Payments : Licensing typically involves negotiating a royalty rate — a percentage of the sales price that you receive each time the product is sold.

Exclusive vs. Non-Exclusive Licensing : With exclusive licensing, only one company can produce and sell the invention. Non-exclusive allows multiple companies to do so.

Specialist IP agencies : You can work with a patent broker or intermediary (e.g. DF Bluem) who specialises in licensing patents. They can help you find buyers, negotiate deals, and ensure you get the best price.

Advantages : This model reduces your risk and upfront investment, but you’ll have less control over the process and earnings.

Sell the Invention

Selling Your Patent : You can choose to sell the patent outright to another individual or company. This gives you a lump sum payment in exchange for full ownership of the intellectual property.

Specialist IP agencies : You can work with a patent broker or intermediary (e.g. DF Bluem) who specialises in selling patents. They can help you find buyers, negotiate deals, and ensure you get the best price.

Crowdfunding

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Platforms : Use crowdfunding websites like Kickstarter or Indiegogo to raise money for your invention by offering early access, special rewards, or equity in the product.

Pre-Sell Products : Crowdfunding allows you to gauge consumer interest and secure funds for manufacturing before the invention is even made.

Marketing : A successful crowdfunding campaign requires a compelling pitch, an engaging promotional video, and an effective social media strategy to build awareness.

Start a Business Around the Invention

Entrepreneurship : You can build a business around your invention. This includes setting up a company, creating a business plan, seeking funding (from venture capitalists or angel investors), and building a brand.

Market Research : Conduct research to validate demand and identify your target audience. Create a product that resonates with customers and solve a pain point.

Scalability : Once you have a prototype and a business model, you can scale the operation through marketing, increased distribution, and possibly expanding the product range.

Build a Brand Identity : Along with your invention, consider developing a brand that will appeal to consumers. This includes logo design, packaging, and marketing that resonates with your target market.

Social Media : Use social media platforms to build awareness and community around your invention. This can help attract customers directly and indirectly through user reviews and organic growth.

Sell to an Established Company

Direct Sale : If your invention fits within an industry that large corporations are already operating in, consider reaching out to them with a proposal to sell or license your invention.

Business Development Teams : Many large companies have departments dedicated to acquiring innovative technologies or products. It may be worth approaching them directly or leveraging industry connections.

Acquisition : If the invention is highly valuable, you could potentially sell your whole business to an established firm looking to integrate your invention into their product line.

Strategic Partnerships

Partnering with Influencers : Collaborate with influencers or other businesses that have access to your target market. They can help promote your product and increase sales.

Corporate Sponsorship : Large corporations may be interested in sponsoring or funding your invention, especially if it aligns with their brand or product line.

Incentivise with Offers

Limited-Time Offers : You can create special offers such as discounts or exclusive early-bird promotions to incentivise customers to purchase the invention right away.

Subscription Model : For inventions that can be used repeatedly or updated (e.g., tech gadgets), consider offering a subscription or service model for ongoing revenue.

Key Considerations

Legal and Tax Considerations : Consult with intellectual property attorneys, tax professionals, and business advisors to ensure compliance with local laws, handle taxes, and protect your assets.

Marketing and PR : A strong marketing plan is essential, as even the best invention can go unnoticed without proper exposure. Consider both traditional and digital marketing strategies.

Sustainability : Think long-term, not just in terms of launching your invention, but also how to maintain its success over time.

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By selecting the appropriate monetisation strategy and aligning it with your invention’s potential market, you can maximise your chances of financial success.