There are many challenges to inventing, not the least of which is: how to succeed on a limited budget.
Patents are expensive – approximately $5,000 – $10,000 or more (depending on invention complexity). Developing, marketing, and bringing your own product to market can cost many thousands more. Is is possible for an inventor of modest means to possibly hope to succeed in a career that is front-loaded with costs and profits (if any) may not come till years later?
The answer is yes. The devil is in the details.
First, let me recommend a book Inventing on a Shoestring Budget written by my good friends and mentors; two very successful inventors whose books should be mandatory reading for all aspiring inventors.
Now, let me recommend specific paths of action inventors of limited means can use to move forward towards inventing success.
- Have a strategy: be very clear about what you hope to achieve
- Leverage cost-effective resources to move forward
- Use other people's money
Strategy is critical to all inventors even well-capitalized ones, but especially to those with limited funds. Large businesses use return on investment (ROI) as a key tool for decision-making and so should you.
Inventors can optimize ROI by focusing upon product categories where demand is very strong and development costs are low.
For example, the American Pet Products Association estimates that $58 billion was spent on pets in America in 2014. Pet products in general and pet toys in particular are hot commodities for inventors. Recent hits include Cat's Meow and Purrfect Arch. Walk through any pet store and you'll see dozens of toys for cats and dogs. In many cases, development costs of pet toys are low compared to those of more complicated products.
If pet products is not your passion or interest, consider kitchen products and home organizational products – perennial favorites of QVC and other home shopping channels. Do your own research to uncover other promising categories.
Seek out and leverage cost-effective resources to assist you in bringing your product to market. Unless you consider yourself an excellent businessperson and one quite tolerant of risk, you should focus on licensing your product to a manufacturer rather than developing and producing it yourself. I have done both and definitely prefer licensing.
Cost-effective resources include Quirky, Lambert & Lambert, Kickstarter, and Indiegogo to name a few.
Quirky is an innovative engineering company located in New York where you can submit product ideas without needing a patent (though having a provisional patent might be a good idea). Quirky uses crow sourcing to vastly multiply its available creative pool and can cost-effectively bring products to market quickly as a result. If they choose to develop your idea and it becomes a success, they will pay you a royalty on sales. A teenager made hundreds of thousands in royalties from a multi-connector idea for electronic gadgets he brought to Quirky.
Lambert & Lambert is one of a few legitimate invention marketing companies that can aid you in licensing your product if they see it has true potential. If successful, they will keep a percentage of any royalties you receive. Your only cost is a small initial cost for their evaluation of your product.
Kickstarter and Indiegogo are very successful crowd funding sites with amazing success in launching new products into the marketplace. You must do a good deal of due diligence and promotion and produce a good video to be successful, but this is a very low risk way to effectively test market a new product using other people's money. Some successful Kickstarter projects have attracted venture capital financing to quickly evolve into big businesses.
Lastly, utilizing any of the above resources comprises using other people's money (OPM). OPM is not a new digital age concept but one that has been around for as long as humanity has used money in exchange for goods and services. If you take out a college loan, business loan, or a mortgage on a home, you are using other people's money. Someone else has bought or provided the full cost of services up front in exchange for your promise to repay the costs over the long term with an interest-bearing loan.
For an inventor, OPM means leveraging the expertise, considerable network, and financial resources of a larger organization to do what you cannot do: fund, develop, and bring your product to a large marketplace of buyers.