In this Age of Information, more resources are available to assist the independent inventor in his quest for market glory than ever before. Learn how to add your product to the ranks of famed independently developed gadgets and gizmos.
The United States of America is an inventive nation founded with entrepreneurial spirit. Since our forefathers signed the Constitution in 1787, U.S. inventors have been granted more than 5 million patents. Capitalism dictates that the best inventions are those used by consumers, however, innovative ideas are easier to conceive than to commercialize, and experts say many inventions never reach the retail market. "It takes a lot of strenuous effort, no matter how good the product is, to capture the interest of the marketplace," says Thomas E. Mosley, Jr., marketing expert and author of Upstart Publishing's "Marketing Your Invention."
The good news is we are in the midst of an Information Age, and more resources are available to assist the independent inventor in his quest for market glory than ever before. The zipper, frozen pizza, kitty litter and Beanie Babies are among the hundreds of famed products invented by independent product developers - and each one of them followed roughly the same process of invention marketing. Experts say, however, if failure occurs at any point during this process, the idea may be forever lost to the public, and they stress the importance of constructing a clear roadmap to the marketplace.
New inventions must go through several developmental phases before finding their way to the market. After creating a concept, you must research the industry and construct a prototype to obtain a preliminary determination of the product's marketability. Once a demand has been established, protecting the idea becomes a top priority followed by finding financial backing, which requires a good understanding of venture capital versus licensing. Although this process can be challenging to an entrepreneur with little experience in the field of commercialization, taken one step at a time, the journey can seem less intimidating. "Do your homework," urges Joanne Haynes-Rines, publisher of "Inventor's Digest". "Get a sense of what it is going to take to get that product to the market before you ever get started. You will definitely minimize your mistakes if you have a clear idea of where you want to go."
For this reason, preparing a business plan is recommended during the early phases. "Absent a business plan, the process will be difficult, if not impossible to complete successfully," says attorney Ira Kaplan, partner in the Intellectual Property area of Benesch, Friedlander, Coplan & Aronoff, LLP (BFCA) . Mosley says an inventor must wear many hats at once in order to bring his invention to market. "A successful inventor is like the conductor of an orchestra," he offers. "He knows only a little about each instrument and yet somehow organizes the playing of a symphony."
Inventor's Log: Date of Conception
Experts say establishing a date of conception can be critical in the life of a your invention. In many countries, patents are awarded to the first inventor who files the appropriate forms. However, in the United States it is possible for two, unique inventors to file for patent protection on the same invention, which may result in a pseudo-litigation mechanism within the U.S. Patent and Trademark Office (USPTO). "The applicants must prove themselves to be the first party to be entitled to the commonly claimed subject matter," says attorney John Garred, Kaplan's partner in the Intellectual Property area of BFCA.
Garred says the common notion of sending oneself a certified letter to secure an invention date is of no evidentiary value in U.S. courts. To properly stake your claim, you should file a disclosure document with the USPTO. While this does not provide patent protection, it does establish the Patent Office as a witness to the date of conception of your intellectual property, and the fee is nominal. Authorities also recommend a log book, with bound pages numbered and sewn into place, in which you can provide a written disclosure of the invention and have it witnessed by a non-inventor during progressive stages of development.
Early Market Research Is Key to Product Development
Once you have documented the birth of your concept, determining marketability is the next logical step. Mosley says, "In short, as much market research as possible should go into the project prior to building a prototype or filing a patent." He says this is true for three reasons. First, everything else that follows cost money. Second, you may have invented something that has already been invented but never developed and sold, or third, you may have invented something that is already on the market.
Robert Black, a chemist and the inventor of Clean Shower, a hands-free bathroom-cleaning agent, says his initial market research consisted of furnishing samples of his solution to friends and neighbors. "They were polite, and they humored me when I told them they would never have to clean their showers again." He says it was only when they came back and said, 'You don't understand; you can't let me run out,' that he knew it could succeed in the marketplace. Black invented Clean Shower in 1995. Since then, he has not only taken his invention to the market, but the Jacksonville, Fla.-based company he built around the product is cleaning up in its industry, with an estimated $85 million in revenues expected in 2000.
The Inventor as Model Maker
Being a chemist, Black was able to concoct his solution relying on experience he gained in his field of training. However, constructing a prototype represents an early obstacle for many inventors who may not have the necessary skills or resources to make a working model. Still, for the budget-minded inventor who cannot afford a professional model maker, Haynes-Rines recommends trying to complete the prototype on your own, bartering services along the way whenever possible. "Remember you aren't looking for the finished product here, you are just trying to see if it works," she advises. She adds in some cases where the invention is complex, virtual prototyping can be a cost-effective alternative. "A virtual prototype can be created much less expensively than a physical prototype and can demonstrate to both investors and potential licensees what the product is and how it works."
Regardless of the method, prototyping is crucial during the early stages of development because it will help you cost out the production of your invention. "I've seen so many things that may be really neat ideas, but the cost to produce them is just much higher than the retail price consumers are willing to pay," says Haynes-Rines. In addition, the prototype is a starting point from which improvements can be made. Mosley says rarely does the finished saleable product look like the original prototype.
Protecting Your Intellectual Property
Inventors often find themselves in a "Catch-22" situation at this phase of the marketing process. With a finished prototype, you are now ready to show your idea to potential investors, however you must also be wary of idea snatchers. But there are cost-effective measures to protect your intellectual property, even during its infancy.
"We recommend that an inventor give strong consideration to having an executed non-disclosure or confidentiality agreement with anyone to whom substantive disclosure of the invention is given. This provides independent protection via contract," explains Garred. Examples of generic confidentiality agreement forms are generally free and readily available from inventor's assistance groups. Further protection can be sought from the U.S. government in the form of a provisional patent application (PPA). "Once a PPA is filed, it is patent pending for one year, and during that year it is theoretically safe to allow the market to speak regarding the efficacy of the potential product or process. If it looks like the market will accept the new product during the one-year window, the inventor can convert the application into a regular utility patent," explains Mosley.
An Objective Evaluation?
People may begin to approach you at this point, recommending you seek an objective evaluation of your invention. Mosley says it is a myth that any evaluation can be completely unbiased. "While an evaluator can objectively look at some aspects of an inventor's prototype, for example, its color, shape or moving parts, most additional evaluation criteria are subjective. Evaluations can in no way be good indicators of potential success. There are simply too many unknowns that will occur along the commercialization path," he explains.
That said, Mosley adds, if one understands the strengths, limitations and motivations of the evaluators, positive actions can result. "It can help one think through the invention's strengths and weaknesses." There are several well- known organizations that offer marketability evaluations, including WIN Innovation Center, Washington State University and Wisconsin Innovation Service Center. Experts warn to exercise caution with invention development companies. Haynes-Rines says to insist upon referrals from such companies and ask for examples of the products they have taken to market.
The Importance of Patents
Our Constitution was written to encourage inventors by excluding the competition with patents. Patents not only provide protection to the inventor by prohibiting others from making, using or selling the invention, but act as a unique marketing tool as well. However, the patenting process is lengthy and expensive, and you must consider if it is worth the cost before investing additional money. A patent search allows you to further explore your options at a much lesser financial risk. While this is not a requirement of the USPTO, it has several additional advantages. "First, an applicant is provided with information as to earlier, related developments," explains Kaplan. He says this will aid you in determining whether the expected scope of patentability is significant enough to merit the time and expense associated with the application process. "Second, the search may return one or more active patents that may provide infringement problems if the applicant undertakes exploitation of his or her invention. Third, a knowledge of the prior art will result in a better chance of securing a patent in a more expedited fashion."
Patent searches range in cost from $400 to $1,500 depending on how the search is conducted. Utilizing the Internet, you can visit the USPTO online and, for a reasonable fee, search for patents using key words, author name or patent numbers. "Although a professional search is still recommended prior to submitting your patent application, you may be able to find enough information online to preclude further involvement in the original idea, freeing up time and resources to proceed with the next idea," says Mosley. The USPTO also offers professional searchers, however this method is much more costly.
Legal advice can also be costly, but the patent process is complex and experts recommend consulting an attorney as early as possible. Initial telephone consultations are usually free and can actually save you time and money. "A patent attorney will make an inventor aware of deadlines that will significantly impact the patent process," explains Garred. He says, for example, if an inventor attempts to exploit an invention by offering it for sale, a one-year time period is triggered. "Failure to apply for a patent within that one-year period may preclude the inventor from seeking any patent protection at any time," he advises. Once issued a patent, though, the government will grant a non-renewable period of exclusivity to the inventor, usually 20 years.
However before this exclusivity can be enjoyed, a patent application must be filed in the USPTO, coupled with a declaration of inventorship, presentation of any relevant prior art and the filing fee. This part of the process generally costs $4,000 to $5,000 and because of the complexity and expense, is where many inventions fail. Although there are standard fees involved in patent filing, it is important to remember that all patents are not created equal. In fact, Mosley says some aren't worth the paper they're written on. "If a person can design around a product, then the inventor can't exclude anyone from the basic purpose of a patent which is to exclude people from marketing a similar product," he explains. He says this is another reason to seek professional advice. "It's up to the patent attorney to debate with the patent examiner the broadest scope of protection." Foreign rights can mean increased product revenues, but you must seek additional patent protection in order to secure those rights. Experts also warn that falsely advertising your product as patent-pending can result in a federal misdemeanor.
Jim Domke, photojournalist and inventor of the Shooter's Bag, a camera bag designed for professionals, says the patent process was the most challenging part of bringing his invention to market. The USPTO initially denied his application, and he was forced to redesign the invention and file a second application before a patent was issued on the Shooter's Bag. He says he created the Shooter's Bag to solve a problem while working as a photographer at the Philadelphia Inquirer. "The bag I created had the necessary cushioning, yet tons more room. It was designed so that I could get at my equipment instantly, without having to take the bag from my shoulder. My colleagues liked my ideas and so did thousands of other photographers.
What started out as a kitchen-table experiment is now a line of intelligently designed and executed bags and accessories that are recognized throughout the world as the photojournalist's choice," says Domke. In hindsight, he says the patent wasn't worth the effort or expense. "In my book what matters is getting out in the marketplace first and being recognized," he explains.
Commercialization is a concern, but with your PPA, you can let the market itself determine if the invention is worth the time and expense of patenting.
Reading the Market
The list of obstacles for an inventor taking his product to market is a long one, indeed. Mosley says the next challenge lies in reading the market. "To the degree that it is possible, the inventor needs to let the market speak at every stage of development of the concept," he insists. Mosley says the number one way to overcome initial consumer reluctance is through user testimonials.
David Gordon, CEO of Oklahoma-based Arctic Shield, Inc. also used this method to test the marketability of Chilkoats, a thermal boot cover he invented in 1997. Chilkoats are designed to keep the feet of hunters, fishers and campers warm in cold weather. Mosley says Gordon was able, with a small amount of capital, to let hunters see and experience the product, and let them tell the inventor whether or not he should go forward with the idea.
Mosley says this technique is equally effective with any invention. "I've yet to have anybody say they weren't willing to look at a product in their particular field and offer an opinion on it," he says. Domke's invention, the Shooter's Bag, is well-known for its user testimonials featuring photographs of professional photographers around the world carrying the product.
Timing Plus Image Equals Success
User testimonials are helpful, but experts agree the inventor must also find some success in the marketplace before he can expect to find a venture capitalist or a licensee. "You have to prove yourself to the market," insists Black. Contrary to Emerson's eloquent statement, the world will not beat a path to your door just because you have built a better mouse trap. However, two important marketing concepts, invention and inventor positioning, can help you attract the funding that will ensure your product is available to consumers.
"If an invention is to be moved toward commercialization, it has to be marketed correctly. Its features have to be described and its benefits communicated in an appropriate manner to those who can help make it happen," explains Mosley. This form of communication is known as positioning.
Black says in the beginning, Clean Shower used positioning to try to change consumer behavior and admits this was the biggest challenge with his invention. "That's been the problem right from the start. The buyers in the stores didn't believe we could compete and were reluctant to give us their precious shelf space. Black says he was fighting for space with Procter & Gamble, Dow Chemical Company, S.C. Johnson Wax and others. "You only get your product on the shelf when they take someone else's off."
The Clean Shower slogan, "Never clean your shower again," made a bold statement to the public. But the public had to have access to the product in order for it to succeed. "I was able to get permission from a local convenience store to put it on their shelf, just as a test." He says he gave the solution to the store at no charge, then hired a publicity firm to cover the story. "That generated enough demand that I was able to get into a local division of Winn Dixie. Then I went into beauty parlors in Winn Dixie shopping centers, and I gave the employees and the customers samples." He told the ladies they would never have to clean their showers again, until it ran out. He also informed them they could purchase the product in the Winn Dixie located in the same shopping center when it did. "That was my marketing. And it worked. Word of mouth and sampling in the beauty parlors gave us the number-one seller in the Winn Dixie division in Jacksonville very quickly," explains Black.
Inventor positioning is similar, requiring you to "sell yourself." However, Mosley says companies often don't like to talk business with the inventor. "So tell it like it is. You are a commercial painter, with a better idea for painters. You also just happen to have a patent on the idea," he explains. Mosley says nothing can be stronger than that. "This gives your product instant credibility because as a professional painter you are familiar with items that are available to professional painters."
Domke positioned himself in such a way as inventor of the Shooter's Bag. His experience in photojournalism made him an authority in the area of camera bags. However, Domke says he feels timing is everything in the process of taking an invention to market - from conception to obtaining financial backing.
Financial Matters
Kaplan says that if you have a novel core technology, there are a number of ways to find potential investors to back you. "The entrepreneur should investigate state funding for his or her invention, as well as looking into what seed capital funds may be likely investors," he suggests. Haynes-Rines says family and friends are an obvious choice, but stresses that invention marketing is not a free ride. "Why should anyone else invest in your invention if you aren't willing to?" she asks.
"Additionally," explains Kaplan, "it would be important for an entrepreneur to network in his or her business community in order to ascertain what investors are interested in certain kinds of technology. These individuals typically have had business successes of their own, may have sold their businesses and are now investing in these kinds of opportunities." Clean Shower inventor Robert Black invested an estimated $64,000 in his invention before finding approximately $1 million in financial backup from Paul Porter, current vice president and COO of Automation, Inc., the company that produces Clean Shower. A utility executive and building contractor, Porter hadn't considered product marketing until networking led him to Black's cleaning solution.
To Venture or to License? That is the Question
The inventor has two choices when it comes to the financial aspects of taking his product to market, either form a company built upon his product, like Black did with Automation, Inc., or license the invention to another manufacturer. "The advantage of forming a company that is venture-funded is that the founder can remain involved in the commercialization of his or her technology and, hopefully, derive a substantial economic benefit from the appreciation of the equity that he or she retains in the enterprise," explains Kaplan. Experts say, however, many if not most products are licensed to existing companies.
"Most of the time, an inventor should probably be thinking about licensing to a synergistic company," says Mosley. He says most decisions to buy a product off the shelf are based on emotions and adds this is also true of licensees. "The best licensing candidates," suggests Mosley, "are smaller companies with distribution channels already set up." He stresses that this is far less risky than venturing. Domke agrees; after five years in the mail-order business, Domke licensed his invention to the New York-based Saunders Group, a photographic equipment manufacturer and distributor, for approximately $500,000. With this exclusive licensing agreement, he sold the invention and the use of his name to promote it.
Another option would be a non-exclusive agreement that allows more than one manufacturer to produce and sell the product. While no two licensing agreements are alike, many may include payments up front as well as milestone payments and royalties upon successful commercialization of the product, according to Kaplan.
"Under these circumstances, the inventor will typically lose control of the commercialization of the product although he or she may negotiate a right to continue to participate in the research and development process."
Mosley says negotiating licensing agreements should be a win-win deal. "A good licensing agreement provides both the inventor and the licensee with the ability to make money through sales, sublicensing and infringements, and it rewards the two parties according to the risk they accept," he explains. Regardless of your funding choices - venture or licensing - Mosley urges the inventor to listen to the market every step of the way. "If the market says it's good, then double your efforts. If the market says it's not so good, do some soul searching. And if the market says it's terrible, then can it and go down the road to the next great idea."
Help Is Near
With the many newsgroups available on the Internet, help is always near. There are also hundreds of government and non-profit organizations, universities and small business development centers across the nation that can provide you with assistance from prototyping to patent filing and more. The following organizations provide assistance to inventors.
Alliance for American Innovation
Inventions and Innovation Program
Inventors Forum Inventors Organizations and Associations
National Congress of Inventors Organizations
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