Licensing is a money-making process. It’s often confused as a legal process. Legal is a part of it, but the core of licensing is a process to turn your IP into money-making products, services or technologies.
What’s often overlooked is that it is a process, meaning it is a continuous sequence of activities. If you follow the process, you’ll be successful. If not, you’ll wind up frustrated and not getting anywhere with your licensing activities.
The licensing process includes a series of tasks to successfully license your IP. These include:
- Determining What Will be Licensed
- Talking to the Right Companies
- Understanding What Problem Your IP Solves
- Explaining Why Your IP is Valuable to Them
- Showing Them How it Makes Money
- Getting Them to Buy into a License
- Negotiating a Deal
- Helping Them Succeed
Depending on what type of IP you own – patent, trademark, copyright or trade secrets – there are many ways to license it. Figuring out where your IP fits in the market is one of the steps that helps decide your licensing options. Is it a mass market product, or designed for a specific niche market? These require different types of licensing partners best suited for these markets.
But before you can license your IP, you have to prove it’s valuable for a company to license it. Test marketing, regional or online sales, and direct response are all ways to proving there is a market and demand for your IP. It’s tough to license an IP if you don’t know if anyone will buy it.
Communication is a big part of licensing, and that means developing presentation materials to show potential licensing partners. This includes one or two page summaries, power point presentations and any other information needed to tell your IP story.
But the most important part of the licensing process is taking action. If you’re not doing anything to promote your IP, how can you find a licensing partner? Licensing takes time. Sometimes a deal develops in a few months, other times it can take years. But if you don’t take action and follow the process, then nothing will happen with your IP.
Remember, an IP in motion makes money.
Here’s a quick video introduction to licensing that covers these key steps including finding the right fit, creating marketability, presenting your IP and negotiating the deal.
