Licensing as One Option to Sell Your Inventions

John Hastie, a former aerospace engineer, is the classic example of the overnight success. Well, overnight if you consider ten years overnight. In reality, many successful inventors can relative to this timeline. Hastie invented Acusharpe Razormate, a rectangular unit that keeps personal razors sharp for months through a magnetic process. Hastie spent nearly a decade developing, producing and selling his product before he licensed it successfully to UniQuest, a Falconer, New York firm, in 1987. 

When an inventor licenses an invention, he or she gives the manufacturer the right to reproduce (or lease) a protected (patented, trademarked etc.) work in exchange for royalties. This is a good alternative for inventors with little time and/or business management skills. It frees the inventor to do what he or she does best: create. After all, even in the age of entrepreneurship, not everyone wants to (or is qualified to) run a major company. For these hands-off entrepreneurs, licensing an invention to a company for a percentage of the profits makes the most sense. 

Once the product is licensed, the manufacturer takes on the burden of manufacturing, promoting, and insuring the product. Most importantly, the manufacturer bears the entire financial burden from that point forward. 

In 1990 alone, manufacturers had licensed products to the tune of $10 billion! But don’t let that impressive figure lull you into believing companies will stand in line to take over your product. 

As John Hastie discovered when he tried to peddle his Acusharpe Razormate, companies tend to be skeptical about both your product and your professionalism. For example, even though Hastie had been working with heavyweight companies Amway and Brookstone, he ran into problems when he attempted to sell K mart on the idea of distributing his product. Company executives didn’t think consumers would believe that a razor could sharpen itself without some type of electronic gizmo. The fact that Hastie had a good product that people loved once they tried it never entered the equation.