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Ideas can be made to pay

Posted by keelynet on July 19, 2009

This guy has some great advice for inventors!

inventwheel108“WHEN American inventor Stephen Key stuck a photograph of Michael Jordan on the backboard of a toy basketball game, he knew he was on to a winner. Who wants to throw basketballs at a boring backboard when they could thrown them at a basketball superstar?

“I sent the idea to a company and three days later I had a contract,” Key says. “We sold that item for 10 years in the United States and I collected a royalty on every one they sold.” Now a veteran of more than 20 inventions, he spends his time telling others how they can make money from good ideas, and the global financial crisis means there has never been a better time.

Too often, Key says, good ideas go nowhere because inventors are typically shy people, with little or no business and marketing skills. But he has developed – or is that invented – a simple way to get a company interested and now tours the world to share his secrets. The first tip is to ensure the invention is new, and there is a demand.

“I don’t really consider myself an inventor,” he says. “I consider myself just a consumer and if I can see a problem or I read about a problem then I try to come up with an idea.” The next thing is to protect that idea, but lodging a full patent can be expensive. Instead, he says, opt for an $80 provisional patent that allows the crucial words “patent pending” to be applied to any product and documentation.

The legal protection can be vital in safeguarding an idea, although after 25 years in the business Key says corporate theft of ideas is rare. Key’s pathway for inventors is nothing new until the next stage, where he says people should avoid spending too much time and money on developing a prototype. Instead of a working model, he advises drawing up a “sell sheet”, basically a one-page document that explains how the product will work, and what are the benefits. “What you’re basically doing is you’re investigating to see if the idea has that sizzle.

“Does it have the benefits, because at the end of the day you’re not selling patents, you’re not selling prototypes, you’re selling benefits,” he says. Key warns against inventors trying to control too much of the manufacture and development of their ideas, saying: “They’re so emotionally and financially attached it’s hard to let go.”

He prefers to license his ideas and then leave it to others to get on with the hard work of manufacturing the product, citing valuable advice given to him by his father. “My father gave me three very important tips,” Key says. “He said to generate great wealth you have to find an opportunity that doesn’t require you using your hands, doesn’t require your presence and has a multiplying effect.”

“My specialty is licensing and I like to say that licensing is basically you’re just renting your ideas to a company,” he says. “You have to be flexible as they’re going to redesign it and it might not look like the same thing at the end of the day.

“I always tell my kids when they say ‘Dad, why isn’t your name on the product’ . . . the only place I want my name is on the cheques.” Everyone is looking for that one big invention that will lead to riches but Key points out that only about 97 per cent of patents lead to an actual product.” – Source

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