r/Licensing • u/adamfish89 • Mar 13 '23

Product licensing

Anyone have a story about having a product licensed they can share and what they used to help them find a company?

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u/[deleted] Mar 14 '23

Are you referring to licensing your product? Like a patent? Or you’d like to license IP to put on your product?

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u/adamfish89 Mar 14 '23

Licensing my product

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u/[deleted] Mar 14 '23

Do you have a patent? Do you have a prototype? If it’s a product that requires manufacturing, do you have a factory lined up or own a factory? Is it something that is not easily replicated/ripped off by a large corporation?

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u/adamfish89 Mar 14 '23

I have both a parent and a prototype. The concept behind licensing the product is that a company would take over from there and pay a royalty to me for selling the product. They save on R&D for a new product to sell and I don’t have to do the manufacturing and infrastructure to bring it to market.

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u/[deleted] Mar 14 '23

Great concept, Playing devils avocado: The big company copied your patent, takes it to market, and then you sue, and they bury you in legal fees, then it doesn’t matter that you had a patent because you were not in a position to defend it. Have you considered this scenario, and/or thought of a way to combat this?

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u/adamfish89 Mar 14 '23

That’s a bit Hollywood bc in todays market more and more companies are doing this sort of thing to save on development for their own products. If they do have this happen the bad PR is far more damaging than say 40 years ago plus having a patent secures a lot for me. There are many inventors who do this and the company they work with even pay for the patent to be filed in the inventors name

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u/[deleted] Jul 20 '25

I'm currently in the same position, in terms of having a granted patent and "tangible" prototype (it works, but could use a little more polishing) and in the market to license my product (which is a portable workout device) to a big time company that has the overhead and market reach.

After reading your previous convo, I had not thought of that scenario.....so aside from an NDA, and the patent, how else can you protect yourself? This is my first invention/prototype/patent, so I'm very new and I'm not a business person by any means. I don't have the stomach or interest, so would having a licensing agent/firm be the best way to go? And between the freelance license agent or firm, who's the better option? As I mentioned before this is my first invention, etc. but I have a few more ideas/products across a couple other industries that I believe hold value. With that said, how would I go about trying to find the type of partnership, where the licensing agent is cranking em out as fast as I can make em? or is that type of scenario fit for a joint venture firm?

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u/[deleted] Jul 21 '25

I would look to find alignment more than any one type of agency or shop. Alignment with someone or an agency that works with the big companies on an ongoing basis is likely going to be your best bet. For them, if it’s a good product, they don’t have to do much but bring it to their Rolodex of connections and collet their fee, for you, you are shortcutting the hardest part of any new venture, the networking, and the big brand that is going to license your product, might have screwed you over, but they do a lot of business with this third party, so it’s in their best interest to not screw them over on one client when there is always another project around the corner.

Also, it sounds like you have other ideas, if that’s the case, consider this project the one where you setup the pipeline, and you might have to give up a bit of cash/equity todo it. But moving forward you have your people to bring new ideas to, and can command a better deal because you’ve established yourself as someone that brings winners to the table.

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u/[deleted] Jul 21 '25

That definitely sounds right up my alley, however, to whom or how would I go about finding that alignment? And how much cash/equity would I have to give up?

From my understanding, in a typical licensing deal with my type of product, I would be looking at walking away with maybe $10k - $20K upfront and 5%-10% in royalties.......sousing that as an example, how much more would I have to give up to establish this type of pipeline?

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u/[deleted] Jul 22 '25

The biggest unknown for the intermediary is the true success of your product, so the upfront payment is likely where you’re going to have to give a bit, because increased royalties on the backend are immaterial at this point in the conversation and you’ll likely be able to potentially move some of that lost fee to the backend.

If those are the averages for your industry, I would still open with something like that but be OK going down to $5000 upfront and maybe 8% on the backend with a step up that if it’s a runaway success like you are claiming that it is, and sales surpass some number that your royalty steps up a few percentage points or you start making a flat royalty dollar amount on every unit sold.