Patent Licensing Success: Know Your Industry
Over the past few years, several of my clients who had obtained patents wanted to license their rights to third parties. Only one client succeeded. The reason: The successful client was intimately familiar with the industry where his technology had its greatest value, having worked in it for many years. He knew highly-placed executives in the most important companies and was familiar with their product development plans. It took a year and a half, but ultimately we negotiated the first license agreement: A six-figure sum up-front, and up to several million dollars in royalties before the patent expires.
The other clients, in contrast, had to guess at the best companies and the right individuals to approach. Not knowing the companies’ plans, these clients never gained traction. They spent time, energy and money but did not achieve a positive return.
Here are my recommendations for inventors and entrepreneurs who are pursuing patent licensing:
- You are likely to achieve the best return by patenting inventions in an industry that you know well.
- If you don’t know the industry well, work with someone who does.
- Be prepared to invest several years and many thousands of dollars in the effort. If you do not have that much time and money, look for a lower-risk investment.
This blog does not provide legal advice and does not create an attorney-client relationship. If you need legal advice, please contact an attorney directly.