When licensing your intellectual property, the main aim is to create a perception that your IP is valuable to the licensee and it’s in their best interest to license it.
Here are 3 secrets to creating the perception of value:
- A prototype that clearly illustrates the functionality, creativity and utility of your IP is your most important tool. We live in a tangible world, and the impact of being able to hold and try a new product vs. describing it or showing a drawing, is substantial. Videos, animation, and 3D printing are some low-cost ways to create a “tangible” sample of your IP. One of my clients created a short video to “show” how their sound technology worked.
- The second and often overlooked secret is providing relevant market data. The key here is “relevant”. Some company teams where many hats while others have larger staff. Your presentation has to include the critical market data they need to decide. But don’t just spit out a bunch of facts. The information must be weaved together to create perceptions of the IP value. I often start my presentations with the problem/solution information. The bigger the problem the more “valuable” the solution. That is supported by market statistics, customer testimonials, competitive products, focus groups, and other information to reinforce the IP value.
- You’re creating a partnership and the perception of you is the third secret. Based on first-hand experience, I can tell you the perception of the IP owner and how easy (or difficult) I think they would be to work with. People do business with people they like. Focus on success, supporting their efforts and working together.
Remember, companies don’t license IP, they license money. The more valuable a licensee perceives your IP , the more likely they will want to license it.