Don’t make the mistake of just randomly going out to the market and throwing information about your IP at a bunch of companies. That won’t work. Too many times I’ve met with IP owners doing just that, only to wind up back where they started – nothing to show for their efforts.
Your IP is unique and to sell your licensing deal, you must provide the right information to the right person at the right company. The trick is to get all these rights done at the right time.
Creating and presenting the right information about your IP and its licensing opportunity is the first step in convincing a potential partner it will be commercially successful in the marketplace. To do that, you must show why it’s useful – that it’s better, cheaper and/or faster, and how it solves their customers problems or gives them a significant advantage over their competition.
We live in a tangible world. Your IP is intangible, meaning it can’t be touched or even seen if it’s a technology. You have to transform and present it in a tangible format, such as pictures, prototypes or videos.
Remember, from the licensees perspective your IP is still a risk. The value of your IP is that the risk to bring it into the market is much less than what it will generate in revenue. That’s the end goal of providing the right information.
Success in licensing starts with an IP strategy. Part of that strategy is figuring out who the right partners are, whether your IP is right for their business, and the value your IP offers their customers.
In some cases it’s straight forward, such as a new app that automatically keeps track of new car maintenance schedules. This app would be valuable to auto dealers looking for ways to stay connected to the their customers and keep them coming back for regular services.
If your IP is a brand new technology that improves or changes an industry, it needs more information to educate potential partners about its value. I worked with a client who created a new packaging technology for the professional hair salon market. It significantly reduced hair color product waste and increased profits. In this case, we had to figure out ways to prove the value to both the hair salons (the customers) and the hair color manufacturers (potential licensing partners).
Before approaching a licensing partner, make sure you’ve developed the right information about your IP – how it works and why it’s valuable to them and their customers. By providing the right information to the right type of company in the right way, you’ll reduce the perceived risk, and make it more likely that the potential partner will consider your licensing opportunity.