Customer Reviews

Profit from Your Idea: How to Make Smart Licensing Deals

5 star:		(15)
4 star:		(2)
3 star:		(0)
2 star:		(2)
1 star:		(0)

 

 

If you have a patented or a patentable invention and have decided not to manufacture or market it yourself, but wish to license a company to do so, this book is for you. In fact, it is a must read. The book covers not only the licensing of inventions but the licensing of trade secrets and copyrights.

As the author points out, manufacturing your invention yourself (venturing) is often not the wisest course. Few inventors have the funds or the experience to run a successful business venture. Also the cost of fighting infringers can be financially devastating for a new enterprise.

Perhaps the greatest strength of this book is its ability to explain legal terms and legal fine points in down to earth, everyday, language. An example of the practical approach this book takes is when the author comments: "Sad as it may seem, you may be better off with no license at all than a licensee that has a reputation for acting unethically".

He further notes that finding the right partner for a license can be harder than inventing and patenting. The author points out how some common agreements you as an inventor may make may have an impact your ability to license. He cites ten examples. One is a representation (rep) agreement that may require paying the rep a percentage of your license even though the rep was not involved in negotiating it!

How commercial is your invention? A list of 33 areas and factors to check is given. When you consider that only two or three out of a 100 new inventions succeed, it is well worth your time to go over this list early on. The book notes even brilliant inventions may be ignored by the public if the price is too high.

While many inventors worry about infringers, you should also be aware of the fact that "Many patent owners use their patents to earn more money stopping infringers than from selling the invention". An area that inventors seldom worry about is how their spouse may affect their license. Under various state laws, not only can spouses share ordinary property, but they can share intellectual property as well. Their signature on an assignment may be required.

Similar to this is the vital importance of spelling out the rights involved in a joint ownership agreement. A three page form for doing this is given in the book. A convenient feature of this book is that copies of forms appear alongside the subject under discussion. The forms also appear in the appendix and on a floppy disk located on the inside back cover of the book. (17 forms are provided.)

Several pages are devoted to the subject of invention marketing scams and on how to recognize a phony marketing company. Despite the best efforts of state and federal law agencies, scams take American inventors for hundreds of millions of dollars every year. If you do nothing else, read these pages.

For various reasons, companies fear and resist ideas from an outside source. The author offers suggestions for overcoming the "kooky loner" image that Hollywood has foisted on the public with regard to inventors. On the other hand, there are some companies that steal ideas and it behooves the inventor to check out their reputations before disclosing anything without an agreement.

The author discusses the very important topics of GMAR (guaranteed minimum annual royalty), how "net sales" figures can be modified by nine types of deductions, and he examines twelve factors affecting royalties.

A twelve page license agreement is presented and a thorough point by point discussion is made. Here and elsewhere in the book "legalese" is avoided and when it cannot be avoided a plain and simple explanation is given. For example, attorneys use a method called "redline/strikeout" to revise agreements. The author reduces this to plain English.

An eight page checklist for reviewing your license agreement is provided. It tells you what keywords, what phrases, and what terms need to be analyzed. It also refers you to the proper chapter for more information. Regarding "legalese", the author gives a fundamental bit of advice: "If a lawyer can't explain your situation clearly to you, he probably won't be able to explain it clearly to a judge or jury".

This is the first edition of this book. This reviewer suspects it will join David Pressman's Patent It Yourself (now in its seventh edition) as an absolute must read for inventors.

With this one creative work, Attorney Richard Stim has given the inventor lightening power [like the art on the cover shows] in understanding what it takes to license an invention. It's easy to grasp because it's written in layman's terms. He has graphs on the licensing process, with forms in the back of the book as well sample agreements. He's given the inventor the tools and formats for licensing agreements, non-disclosure agreements, option agreements, contract work, agency letters, etc. And, all these agreements are also on a disk which is included with the book. He's outdone himself. I can't say enough about what Richard has put into this excellent licensing course for the inventor. I believe that it not only helps the independent novice inventor, but is also a good reference for those who consider themselves experts. Even attorneys should find this an excellent addition to their legal library. I recommend it highly. Accolades to Richard.

This book is very educational about how to go about the licensing process. It's very easy reading, not the technical boring style. The included software is a major plus! You can customize the included licensing contracts.

Michael Waller

First of all I think the book (the most recent edition as well as earlier versions) is first rate and I highly recommend it. Although the book is geared for do-it-yourself licensors, it is also terrific to help people who are looking for an attorney or who have one they are already working with. Having been a attorney focusing on intellectual property licensing for more than 30 years and teaching licensing to non-lawyer grad students, I know first hand that this book is a comprehensive albeit superficial overview of the licensing process. Despite how good the book is, it will not transform the reader into intellectual property licensing expert.

In the real world, licensing situations often become far more complicated than the impression the book provides. That is especially true when you are trying to negotiate with a large company with experienced IP lawyers. Its like trying to out negotiate a car salesman when buying a car. What the book does impart is a much greater knowledge of the overall landscape. The more you know, the better it is to work with your own lawyer to help you through the complications. People license to make money so the better the license, the more money that can be made.

Also beware that the book seems to focus mostly on patent licensing as opposed to other forms of intellectual property where the strategies and nuances are different. Again, this is only slight criticism as I did very much like the book. It is definitely a useful read for neophytes to licensing.

Joe Hustein

Let's face it - you have an idea that you would like to be sure it is secure with a patent. You also want to market it, but not sure how to proceed forward since all you have is the idea. Well, if you are there, this is the book for you.

I'd like to commend the NOLO series authors as these books have been extremely helpful to me over the past 2 years.

So, Licensing - yes - the book is very helpful in detailing the specifics related to how the entire licensing process works. It will take you deep into the details from finding the agent through the patenting process to the final agreement. The author has taken a careful approach into answering questions like: How to deal with agents? What are ownership rights? How do you deal with International licensing? and How do I negotiate a licensing deal?

The book is ideal for small business owners, inventors, college graduates looking to patent or copyright their senior thesis, etc.

Keep it on your desk at all times, mark it, fold its pages on the areas you are most interested and you will soon find how rewarding it could be to be the owner of a licensed/patented product.

Highly recommended.

Yes, this is a well written and well intentioned book, however, the same non-workable methodologies for independent inventors have been provided freely at any local SBA office for years. This book is so good that it is also cited in a Wikipedia reference for "Patent", heading "Economics", subheading "Rationale."

"One effect of modern patent usage is that a small-time inventor can use the exclusive right status to become a licensor. This allows the inventor to accumulate capital from licensing the invention and may allow innovation to occur because he or she may choose to not manage a manufacturing buildup for the invention. Thus the inventor's time and energy can be spent on pure innovation, allowing others to concentrate on manufacturability."

As an independent engineer in Austin, TX I have seen great ideas developed by numerous brilliant independent inventors, graduate students and professors. The strategy of creating workable prototypes while simultaneously developing lengthy business plans, captivating elevator pitches, and rock solid intellectual property and then presenting your potential product to interested Angel investors and/or "Manufacturing Partners" is bogus at best. A person can also win the lotto, but I would never recommend going out and purchasing dozens of tickets everyday. Following the basic methods espoused in this book and similar books will only lead to frustration on the part of the inventor. If you have a new product that is truly revolutionary, either the status quo of "nothing" or an inferior competitor product will generally not enhance your product's development funding. You as a novice inventor are not considered a bankable commodity by any seasoned investor whose only real interest is on a "great management team" NOT the inventor.

If a book for an independent inventor focuses on manufacturing partners, royalties and intellectual property you will probably be sitting on your idea for many years to come. Ferret out strategies, not necessarily books, that emphasize "Boot-Strapping" your idea into a product with resources under your control, both time and money that you actually possess. Consider an entrepreneurial approach that is coincidental with boot-strapping (lots of books on Amazon). Ask your patent attorney how many of his clients' inventions ever made money. Ask your SBA adviser how to develop an idea into a product with local manufacturing resources and only the money in your pocket. Trust me, you will not like the answers that you get. There is always an exceptions, but of course someone wins a lotto every week as well. Learn some CAD drawing and make models on your computer(books on Amazon),write your own patent& trademark and learn intellectual property(books on Amazon), learn how to use hand & power tools to make your product(buy tools on Amazon), learn how to make your idea into a reality with little money and you will have achieved the first baby steps toward profiting from your idea.

This book and others like it must be read with an understanding that few of the authors have independently taken their ideas to profitability without a whole bunch of outside money and technical support. There is a methodology for independent technical inventors like myself that does work, however, it is not easy and requires that one focus on development of the product to a point that it is "good enough" for sale. When you start selling a product that you developed, patented, manufactured and marketed you will truly be the Captain of your own ship and ready to write your own book.

Christopher Stanford, PE
trekease

If you've invented a commercially viable product or service - especially if it's patentable - this reference book will help you with the next steps. It's much more about the legal aspects and other issues that go on AFTER you've got your golden egg and start soliciting companies, partners for licensing agreements....Definitely for serious inventors willing to persevere. I would have liked more case studies from Stim's past, but realize that confidentiality may not have allowed it.

Although hardly exhaustive, this book covers all the concepts and particulars of the licensing process in adequate depth so that when you hire an attorney to put ink to paper, you'll have an excellent idea of what he/she is doing and of any details you wish to amend or add. Certainly many legal issues can be a "do it yourself" process. Product licensing is not one of them in my opinion. There are way too many very technical issues, which if not handled thoroughly and precisely, may result in you losing all or part of the hard work expended in getting your product to the licensing stage. This book is an excellent primer on the topic.

I am such a fan of the NOLO series that I'll pick up one of their books just to read it and learn something new.

Such as it was for "Profit From Your Idea". I have no ideas to profit from. I'm just not that imaginative. But if I were, I'd want to have this book. Author Stim takes the reader from licensing to getting a good idea if your idea is worth raising hopes for.

The chapters are bursting with information. Chapter 9 - Money Matters took me a week to read through. Not because the writing was clunky or hard to comprehend but simple because it had so much information.

I definitely recommend this book for anyone who has a great idea and wants to look at licensing it for profit. Definitely worth a read.

Five stars, but really, you cannot protect your patent 100%....you will see. After receiving my first patent I learned the hard way. From people wanting to work around it to people trying to "lock" it up. You will need a lot of money to back you because many patent attorney's (at least the several I have spoken to) will not take on most cases on contingency....Keep that in mind and use common sense and this book.......to the book.

Some of the things in this book need to be handled by an attorney. Plain and simple folks. If you are entering into a licensing agreement spend the money on a good attorney....BUT, read this book first. It will help you make smart decisions and stop you from wasting A LOT of time! There are so many things that you need to deal with and this book touches/covers just about everything you will need, from showing your invention to nondisclosure agreements to manufacturing...or not manufacturing. Case in point, I thought I could manufacture my first patent....WRONG...it made much more sense to license it to a manufacturer...but it took quite a while. I think that if I had read this book I would have done it faster, easier and certainly CHEAPER. This book will give you insight and suggestions that may help you go in the right direction for your particulary idea....and believe me, it's easy to go in the wrong direction!

Even if you don't have a patent, but just an idea, this book is certainly worth reading. There is a lot of information here to really bring you up to a higher level of understanding quickly and much more easily than trial and error.