What is Licensing?

When you license your invention, you find a company that will take your idea and manufacture, distribute and market it for you then pay you a percentage for the products sold.

What I like about licensing an invention is that I can get an idea developed, get it licensed and move on to the next idea while making a small percentage on the sales of the licensed product. Also, in most cases, a large company will sell enough more products than I could that even with only making a small percentage, I would still make more money due to the sheer volume of sales.


  • Low investment of money.
  • Low investment of time.
  • Continued income with little or no additional time or money.
  • No need for manufacturing, distribution and marketing.
  • The average person can do it.
  • Quicker to market (in most cases).
  • Much higher volume of sales (in most cases).


  • Give up a lot of control.
  • Lower profit per item sold.

The First Thing to Consider with Licensing is if the Invention Will:

  • Solve a problem or fill a niche.
  • Make life easier.
  • Function properly.
  • Provide benefits over competition.
  • Prove profitable.
  • Will it fit well into an existing company(s) product line?

If the invention does not fit most of these points, it will be difficult if not impossible to get a licensing deal. However, if your invention passes this test, it may well be worth moving forward with licensing.

3 Things Need to be Done to Close a Licensing Deal:

  1. Have a good prototype:
    1. Before considering going to a large corporation about licensing your invention, you must first develop a working prototype (in most cases). The more realistic and professional the prototype and the better it works, the better your chances are of getting a licensing deal.
  2. Protect your intellectual property:
    1. It is also very important that the invention be protected before approaching any corporation. In most cases when licensing an invention, protection is done with a provisional patent.
  3. Learn the system well or hire someone who already knows:
    1. There are several books and organizations that can help an inventor learn about and even close a licensing deal. It is well worth the investment of time and/or paying someone with experience to help close a licensing deal rather than trying to take shortcuts and hurry through it thus never getting anything closed at all.

One idea that a lot of inventors seem to have when first thinking about licensing their invention is that they will get a large up-front payment. While this may happen, it is very rare there is anything paid up-front. The company usually has to put a large sum of money into tooling up for manufacture, raw materials, labor from several departments, distribution, marketing, etc. before they ever see a dime. Depending on the product, this can also take several months to get to the first sale and the company is paying interest on the money invested. The company is also taking all the risk, so unless they have little to no doubt that they can make a lot of profit over the life of the product, they will not put out more investment up-front.

Start to Finish Inventions Corp can help you every step of the way to develop your idea or invention including prototyping, securing your patent, manufacturing, and marketing. We can do any parts or all of it—it is YOUR idea so YOU are in control!

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