I remember one of the first conversations I had with a co-worker at my job just after I had applied for a patent for my first invention – an innovative, thin wallet. The conversation went something like the following.
- Co-worker: Hey, I heard you are working on a new invention, a thinner wallet or something?
- Me: Yes, I’m excited, but a bit anxious. I just filed a patent with an attorney – will cost about $5,000 all together for that.
- Co-worker: Wow, that’s a lot. Well, at least that is paid for, then you’ll be able to sell your idea and cash in. Get into a bunch of stores.
- Me: Well, it doesn’t work like that – the patent will take 3 years to issue if the patent is allowed. I’ll need to spend at least $10,000 if I want to get enough inventory for an initial run for a store chain.
- Co-worker: Well Joan Rivers sells zillions on QVC, they just buy all sorts of jewelry from her. Just get them to pay for your inventory, right?
- Me: Well, it doesn’t work like that. I would need to borrow $30,000 and ship a large volume to QVC. Then, they’d only pay me for what I sell on air, which could be $1,000 or $60,000. It is 100% risk.Co-worker: Oh, okay. (he looks for an excuse for a quick exit).
Inventors Spend $$ for Everything and Risk Too Much?
That is almost certainly what my co-worker must have felt from our conversation that day: $5,000 here; $10,000 there; and no guarantee of success … ever. Why would anyone want to be an inventor? Why not just go to the casino where you’d either lose it all quickly or perhaps hit the jackpot?
The good news: it is not that bad.
Bargains Abound – Take Advantage!
As with any business, invention certainly entails risk and there are a variety of things which may be quite expensive: patents, prototypes (sometimes), inventory for stores or QVC, etc. Some of the costly items are basically sunken expenses (you’ll never profit directly from them) such as patents and prototypes, but others, such as inventory, packaging, etc. are COGS (costs of goods sold) and when you sell, your recover the expenses plus profit.
So, without further adieu, let’s talk about the good stuff, the bargains to help you as an inventor.
I think the best bargain I have found is located in every major city in the US: inventors groups. Inventors groups typically meet monthly and charge members a small annual fee to belong, maybe $30 – $50. You get to commune with other inventors, but also great resources like patent attorneys, prototypers, etc. This is some of the least expensive advice and knowledge you’ll ever get and it helps immensely to see other inventors working through the same issues as you are and to discover what is working for them.
The Provisional Patent Application (PPA) is quite a bargain. The cost to file a PPA can be as low as $65 (if you file it yourself) or perhaps up to $2,000 if a patent attorney helps you. The PPA is never examined by the US Patent Office (USPTO), but it gives you 1 year to shop your product around to licensees and you may claim you are “patent pending” during this time. Afterwards, you must file a more expensive utility patent if you wish to proceed forward with your product.
The PPA allows you test out our product inexpensively for a year. If you decide not to proceed further, you haven’t risked much. If someone elects to license your invention, they may reimburse your for the costs of your utility patent.
Local universities and community colleges are another bargain simply waiting to be tapped. Many have industrial engineering groups who will be happy to assist you with prototyping your product at little cost. I found a physics professor who helped me modify my electronic cat toy for free – he refused to accept payment. I wouldn’t have known if I didn’t ask.
Crowd funding is a great bargain for any inventor to potentially have a large successful launch. Josh Malone successfully launched his invention, Bunch O Balloons with a phenomenally successful Kickstarter campaign. The primary cost of a Kickstarter or Indiegogo campaign is creating a compelling video – not very expensive.
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