Prolific inventor Richard C. Levy offers new inventors advice on starting a royalty stream

There’s almost nothing more exciting than experiencing a eureka moment: that gleam of light that flashes across the mind from within and precedes the mother of all ideas… But afterwards, a new challenge – frequently a greater one – faces the inventor: how do you license the concept? What to do next deserves considerable thought and reflection. This step should not be taken lightly.

My name is Richard C Levy. I’ve been creating, developing and licensing new toy and game concepts for more than 45 years. I particularly enjoy sharing with other inventors what I’ve learned, not about creativity but about how to license intellectual property. Here are some do’s and don’ts to keep in mind if you wish to license your concept in hopes of starting a royalty stream.

Do’s…
Do a patent search. Make sure your idea can be protected and doesn’t infringe an existing patent. If you go through a law firm for a search, it will be much more expensive than hiring a patent searcher yourself.

The law firm will step on the fee charged by its patent searcher. This could cost you two or three times the cost of going direct. Here in the US, I use Greentree Information Services. It’s been in business since 1991; owned and operated by George Harvill. You can email George via [email protected].

Do your homework on potential licensees. Match your concept with a company’s product profile and capabilities.

Do market research. Know your target market, how to reach it, and what need your concept fills.

Do network! Get business references, especially from other inventors who have licensed items to prospective licensees.

Do ask questions. Asking dumb questions is easier than correcting dumb mistakes.

Do honest presentations. Nothing astonishes like the truth. Flaunt it.

Do trust yourself and your instincts. They can be anchors in a storm.

Do take risks. The biggest risk is not taking one.

Do learn to take rejection. The finest steel goes through the hottest fire.

Do look at the big picture. Frequently, you may have to trade off short term security for long term goals.

Don’ts
Don’t hire up-front fee invention marketing services. Most are confidence schemes; carrion birds that feed on innocent and unsuspecting inventors.

Don’t think companies are out to rip you off. There are two kinds of newbie inventors: the paranoid and the more paranoid.

Don’t fear signing an NDA. Sign whatever’s fair.

Don’t be deterred because the opposition seems too great. You’ll miss 100% of the shots you do not take.

Don’t turn technical disagreements into civil wars. Where elephants fight grass will not grow.

Don’t take yourself too seriously. Keep your ego under control.

Don’t think you need to make every deal. Sell-itis can be hazardous to your mental health – and your invention.

Don’t bring up the artillery until you bring up the ammunition. Get your act together before you make a pitch.

Don’t pitch ideas… Present ‘looks-like/works-like’ prototypes, or proofs of concept. Support these with technical and marketing data.

Don’t be nervous. Trust yourself. Most of this process is common sense.

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Richard C. Levy, founder and president of Richard C. Levy & Associates, LLC., is toy industry veteran. In his 45-year career, he’s licensed more than 100 concepts, including the phenomenally successful Furby which has sold more than 75 million units. Richard co-authored The Toy and Game Inventor’s Handbook, which Forbes recognised as one of the 33 Best Books recommended by Shark Tank entrepreneurs. You can buy a copy here.

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