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Licensing, Can Somebody Do This For Me?

© By Stephen Paul Gnass

I agree that it would "seem very logical", that a professional or a company, with experience in licensing products, can take on your idea or product and go through the whole process of licensing it for you.

In fact, this idea is so popular with the majority of people throughout the country, that it has kept the invention marketing scams in business for decades, raking in hundreds of millions of dollars each year.

1. Legitimate licensing agents are rare and most of the time, go "incognito"

What most people don't understand, or sometimes refuse to accept or believe, is the fact that the amount of "legitimate" licensing agents who are willing to work with independent inventors, are so few and rare, that it's almost like finding a needle in a haystack.

In addition to this, legitimate licensing agents often go "incognito", meaning they hide and don't reveal that they are licensing agents, because they don't want to be found and flooded with requests from people who have raw undeveloped ideas, who are also not knowledgeable about the process of licensing.

2. Why do legitimate licensing agents go incognito?

a) Independent inventors are known to be very difficult to work with.

A few examples are:

  • Many inventors don't know what a good deal is, they have unrealistic expectations

  • Many inventors tend to change their minds after the licensing agent has done all the work to negotiate a deal

  • Inventors often get greedy and refuse good deals when they are at the table ready to sign a deal

  • Many times, inventors act unprofessionally, not returning calls or emails, being demanding, unreasonable, and sometimes rude

  • Due to the confusion about scams, sometimes inventors treat legitimate licensing agents as if they were scams, grilling them and being aggressive, which immediately turns off the licensing agent and kills any potential working relationship
  • b) Legitimate licensing agents must be careful with the time they spend on projects.

    Many inventors don't understand that it takes dedication, time, and work to license a product. It takes time for licensing agents to make contacts with companies, getting through to the right individuals, and going through the whole submission process. Rarely do deals take place weeks after signing on with the licensing agent.

    It's not unusual for this phase to take 6 months to 1 year just to get to the point where they finally have somebody interested and can even start the negotiation phase. This phase can take many months of making cold calls, sending emails and/or letters. Then, when the negotiation phase is started, a deal may be in the works, but it is not guaranteed until the agreement is signed by both parties. This can take another 3 to 6 months of going back and forth with the potential licensee. Many things can, and do, go wrong or even kill a deal in this phase.

    If the licensing agents don't get a deal, they don't get paid. So licensing agents prefer to work with invention projects where the owners are professional, return their calls, work with them to give them whatever is needed to make a deal come about, know the process, and understand what a good deal is, so that the licensing agent isn't wasting his time, and will be compensated with a percentage of the inventor's royalties for his hard work.

    3. How to spot the scam licensing agents

    I admit that it's hard to tell who's legitimate and who's a scam, but that's only until you learn what the signs are. The scams "look good", "sound good", "read good", and "talk good". So how can you tell if any licensing agent companies are scams or legitimate?

    a. Are They Hard Or Too Easy To Find?

    Legitimate licensing agents are extremely difficult to find, they go "incognito" in hiding, and don't want to have to deal with a lot of people with ideas who are inexperienced. Plus, they only sign "Confidentiality" agreements with someone if they have interest in working with them, not with everyone who they come in contact with, or who asks them to sign one.

    The scam licensing agents are everywhere, they advertise on TV, radio, magazines, web sites, etc., and have wide open doors to anybody with ideas, especially when the inventor is inexperienced, because they are na´ve and more vulnerable to paying the high fees. They freely sign "confidentiality" agreements with everyone and anyone, even when you're not working with them yet.

    b. Do They Take Ideas In Any Or All Fields, Or Specialize In Limited Fields?

    The majority of the time, legitimate licensing agents specialize in limited fields, for example, they may specialize in the toy industry, and maybe some related industry like baby products. Usually this is because they have experience in those areas and they have established contacts in the field. Sometimes they may work in fields outside of their experience, because they know the process, but on a case-by-case basis after carefully reviewing what the inventor's product is. Though rare, there are a handful who jump industries.

    The scam licensing agents take all products in all fields, no matter what it is. Got a product that will transport you into another galaxy, no problem, they take all ideas. Their criteria is, if you got the money, they will accept your idea.

    c. Are They Picky, Or Do They Take Anything?

    Legitimate licensing agents are picky and take on a limited amount of products, because their time is limited and very precious to them. They can only succeed with licensing products if they devote enough time to the products that they take on.

    The scam licensing agents take on thousands of products each year, and run them through a generic factory-like process without any dedicated time to any of them. They send generic mass letters to outdated lists, just to fulfill the services.

    d. Do They Work On Contingency, Or Charge Large Upfront Fees?

    Licensing agents work on contingency, taking a percentage of what the inventor gets only if the product gets licensed.

    The scam licensing agents charge $1,000s or $10,000s of dollars of upfront fees, even charging more fees if the inventor is greedy and wants to keep a bigger percentage of the royalties (that is, keeping a bigger percentage of nothing).

    4. So in essence, the scam licensing agents...

  • advertise everywhere

  • take anybody's products

  • charge a lot of upfront fees

  • offer a lot of services - patents, reports, prototypes, etc.

  • do the minimal work to stay within the law

  • The results are that inventors end up with weak patents, poor designs, weak reports, etc. and nothing ever happens. Once inventors have paid their money, they "get no respect" (like Rodney Dangerfield used to say). Their calls don't get returned, etc.

    But one result that is not usually taken into consideration when inventors sign up with the scams, is that the scams lock up their invention for a period of 1 or 2 years. Then after that, the agreement gives the scams rights to collect royalties if the inventor gets a licensing deal on his own, usually for a year or more after the end of the contract.

    5. So what does this mean for you?

    I know that there are a lot of companies that are advertising their inventor services on the internet, as well as on TV, radio, magazines, etc., and that it's very tempting to want to hand over your invention to one of these companies to license it for you.

    But in recap, if you sign on with one of these scam companies, they'll just take your money and provide the weakest of services, and nothing will happen with your invention.

    Finding a legitimate licensing agent and finding a licensee are similar processes. But given that there are so few legitimate licensing agents who are willing to work with inventors, it will most likely be very difficult to find a licensing agent. So my recommendation is that the inventor roll up his sleeves and act as his/her own licensing agent and make the submissions himself to companies that could be potential licensees.

    Either way, going solo and learning what a licensing agent does, especially if you have somebody helping you through the process, can eventually help you find a legitimate licensing agent, if that's something you still want to do.

    6. Going it Solo, BUT... With My Help and Guidance

    My philosophy is that the inventor is the "Magic" person that can make the invention succeed, that is, if the invention has true value and worth in the marketplace. How do you know if the invention has true value and worth? It's through the submission process and getting feedback from the companies that could and should license the product.

    What I do is provide you with a venue to have your product seen, the Invention Connection® Cybershow, and one-on-one coaching, consulting, advice to inventors, our clients, by phone sessions with email follow up informaton as they go through the process of inventing. This is very industry specific to the client's invention, and his or her unique goals. In addition to this feedback, I also review letters, proposals, agreements, provide referrals to organizations, resources, etc.

    Some people need more help than others. How much help an inventor gets depends on the particular invention, his business experience and knowledge of the invention process as well as what the invention is, and the inventor's personal goals.

    Some inventors check in periodically, get advice and recommendations, then they're off to implement their next step, where other inventors check in frequently, and have me review letters they're sending out, proposals, agreements, as they go through the steps.

    I always say that inventing isn't rocket science, but there is a methodology, it is a process that must be learned. One mistake that I've seen many inventors make, is that after they let go of the false illusion that a company will take on their product and license it for them, they then take the complete opposite direction and go it alone, solo, winging it, shooting from the hip, going through the process without much knowledge or guidance.

    So they often make lots of mistakes like approaching the wrong companies, improperly making submissions, killing potential deals, and occasionally end up with a bad deal or blow their chances right out of the water with the right company(s), that's when and if they do find them.

    So going solo is my recommendation...but going "solo with guidance". My consulting service in this respect, is unique. You go through the process at your own pace, and can schedule phone consultations whenever you're ready to make an appointment with me. You can have me and my staff review any inquiries, proposals, agreements, and other documents such as business plans, prospectus. I can even review and assess your web site if you have one (does not take away from a cyber-booth), and/or guide you to set one up inexpensively, for little or no money.

    I have many years of extensive experience with both intellectual property and helping small businesses, so I can give you guidance in a multitude of areas. I can cover any aspect of a start up business, entrepreneuring, or developing, inventing and licensing a new product.

    Of course, there are never any guarantees that your invention will make it, even if you go through the submission process yourself, and have guidance, but I believe that you will definitely increase your chances of succeeding if your product has true value and worth, and if you utilize my services as your mentor, coach, someone who is here to guide and walk you through the process to help minimize mistakes, going in the wrong direction, running into brick walls, or going around in circles or spending money needlessly.

    7. Are you being "penny-wise and pound-foolish"?

    This phrase comes from the British folk whose "pound" is similar to our "dollar" and they also use the penny in their monetary system. So, in the U.S., it should be, are you penny-wise and dollar-foolish? In other words, are you scrimping for pennies but spending dollars foolishly?

    Making mistakes with an invention can include getting a patent too early, and then having to pay extra fees to the patent attorney and the patent office for changes or amendments to the patent later on. It can include getting a prototype done too early with the same results where you have to pay more money to get an updated prototype later on, or sometimes even re-do molds and other expensive equipment. It can include buying services that inventors don't really need, but that sounded good at the time they were purchased.

    For example, some inventors have paid tens of thousands of dollars to manufacture thousands of units because a TV shopping network was going to feature their product. But the inventor had all the risk, and when the quota wasn't met for sales of the product, the inventor was stuck with any refunds as well as having the inventory shipped back from the cable producers. The inventor was also stuck with the debt, and also stuck with paying for any warehouse space unless he stored it in his garage.

    The product may not have sold because maybe it was rushed into production before the kinks were worked out, or maybe it wasn't the kind of invention that sells well on TV. There can be many reasons why a product doesn't do well on TV. In any case, the product's failure on TV sometimes prevents it from being sold in other markets and affects the product's future negatively. We've seen this happen more than once.

    As you can see, there are a lot of ways to be "pound foolish" in paying thousands of extra dollars, even tens of thousands of dollars, because of mistakes that possibly could have been corrected, had the inventors had an outside advisor. By having me as a coach, mentor, sounding board and advisor, I can give you guidance, but most importantly, any options to help steer you away from taking the wrong direction.

    8. My Philosophy In Working With Inventors Has Three Main Points

    a) Spend Little or No Money

    My philosophy is that almost all of the services and/or things you'll need on your inventing path, can be obtained with little or no money, the key here is "little or no money". Over the years I've saved my clients thousands in needless expenses. I often say that you can't buy success or fix any problem by throwing money at it. So in essence, "little or no money" is the name of the game.

    b) Life's Winners Always Have Someone Behind Them, Whether It's Coaches, Mentors, Trainers, or Consultants

    No one who has achieved success, has done it solely on their own without some help, no matter what industry or field. Even in the Olympics, where individuals compete for the Gold Medal, the individuals don't do it alone. The athletes have a team of people who are hired to coach, train and prepare them to win. In every individual's success story, there's always someone behind the scenes that is supportive, a wife or family member, someone that's giving advice and direction, and success coaches, consultants, mentors and guides. So why do you think you'll succeed, like the Lone Ranger (Oops!, He had Tonto, didn't he!) without a guide, angel, coach or consultant?

    c) Increasing The Odds Of Your Success

    My goal is to guide and direct you on your path to success i.e. increasing your odds of success. This is my objective, this is my goal. It's the same thing that the coaches, trainers and mentors do for the Olympic athletes. They can't guarantee that the athlete will win, but they push, motivate, and give him the proper tools and skills he'll need to be able to aim for the Gold. It's this, plus training, training, and more training, in the final analysis, that increases the odds of success and determines whether the athlete will win one of the prized medals at the Olympics. Remember that the coach and support team doesn't get the medal, but they do receive the joy in knowing that they were the inspiration behind the scenes and knowing that their work really payed off for the athlete.

    In essence, this is what I do - guiding, whether I'm giving clients tips, suggestions, recommendations. Whether clients are emailing or calling me with a specific need i.e. they need me to review contacts, proposals, an agreement, or need help in finding a lawyer, or need to understand how distribution is done, or have questions about whether they should manufacture it in China or the U.S.A if they're going the entrepreneur route.

    "It's All About Increasing the Odds of Your Success"

    So I'm constantly asking myself every single day, how can I better serve or assist my clients, helping them become better inventors. Wouldn't you want someone on your team who has your best interests at heart, who has no conflict of interest, and specializes in guiding, coaching, and mentoring you, the inventor, to achieve success, that is, if it's in the cards that he/she hits a home run i.e. increasing the odds of your success?

    Now that I've tooted my horn, there are:

    9. Two Ways To Get Me On Your Team

    1) CyberExhibiting with One-on-One Consulting:

    The is a venue for showcasing your invention so that interested parties, even "incognito" legitimate licensing agents, can find your licensing opportunity. It's an online advertisement which comes with several hours of one-on-one consulting. You just send us information, and we'll write and develop your cyber-booth for you. The basic package is $845 and includes 1 year of cyber-exhibiting along with 2 hours of phone consultations, and 2 years of unlimited Quick Questions (questions that can be answered in under 10 minutes by email or phone.) If you're interested, here is the link with more information:
    Invention Connection® Cybershow Exhibiting

    2) One-on-One Consulting - By the Hour, or Packages of Hours with Reduced Rates:

    I can consult with you on an hourly basis. My consulting rates for larger companies that are making a profit are $175 or $350 per hour. But for the independent inventor or entrepreneur, the price drops to $99 per hour, or lower with a package of hours.

    More detailed info is below and also at:
    Frequently Asked Questions About My Consulting Services
    About My Consulting Services

    My final questions to you, is, are you being penny wise and pound foolish?

    If you're committed and have a product that you feel has a true market, I would enjoy working with you, with the criteria that you're willing to do whatever it takes in order to succeed and win at the game of inventing.

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    Stephen Paul Gnass is founder of, Executive Director of the National Congress of Inventor Organizations [NCIO] and an inventors advocate. Mr. Gnass speaks on the subject of the "Business of Inventing" [tm] and has had his articles reprinted in various magazines. As Senior Consultant with the Gnass Group, he consults independent inventors and small businesses. He can be emailed at or visit

    A SPECIAL NOTE: Complimentary Brainstorm:
    If you're further along the path of inventing and are ready to launch your product, and need assistance in determining whether to license your idea or build a company around your invention, I'll more then happy to offer you a Complimentary Brainstorm, no obligation. For a Complimentary Brainstorm, please be sure to include your phone number with area code and your time zone with the best times to call you back in your email. Sincerely Stephen Paul Gnass

    I offer additional brainstorming as part of the cyber-exhibiting program. Or, if you have special projects or problems and you need brainstorming, I also offer consulting on retainer on a sliding scale. ***************************************

    This article is for general information purposes only and is not a substitute for legal counsel or financial services. The information provided is accurate to the best of our knowledge, and we are not liable for any omissions or incorrect information. It is the responsibility of the reader to verify any legal information with appropriate professionals. If you need specific legal assistance, we recommend that you contact an attorney or accountant.

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    Please note that your contact information will not be sold or shared with other organizations for commercial purposes. However, as part of the subscription, you may receive periodic e-mailings from us with press releases or information about products and services that we think may be of interest to you.

    A World of InventingTM: InventionConvention.Com
    From this main gateway, you can also access:
    ..National Congress of Inventor Organizations (NCIO)
    ..America's Inventor(TM) Online Magazine (NCIOs publication)
    ..Invention Connection[r] Cyberspace Convention

    The INVENTION CONNECTION[r] is the Official CyberShow of NCIO

    8306 Wilshire Blvd., Ste 391
    Beverly Hills, CA 90211
    800 458-5624 / 323 878-6951
    Web site:

    National Congress of Inventor Organizations [NCIO]
    8306 Wilshire Blvd., Ste 391
    Beverly Hills, CA 90211
    NCIO: 323 878-6952
    Web site:

    Contents, Layout, Style and Source Code Copyright 2006-2010. Stephen Paul Gnass. All rights reserved.

    This article is for the personal and educational use of the subscriber. It may be emailed to friends and family only in its entirety. Commercial Use: This article is copyrighted intellectual property, and no part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system without advance permission in writing from the publisher.


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