So you’ve had a great new product idea, but what do you do next? Thousands of new products are launched every year but the journey from concept to market is not as easy or as straightforward as it appears. Many people think that there must be hundreds of people just waiting to give inventors bucket loads of money to develop the next big thing, but in reality it’s not quite like that.
But it’s not all bad news. There are many individual investors, like the dragons on Dragon’s Den, and also several investor funds which support inventors with new ideas. There are also companies who license new ideas from individuals and small businesses. However these are serious business men and they require a genuine business proposition not just a back of an envelope sketch before they part of their hard earned cash. So how do you go about turning your idea into a viable, investable concept that will impress industry or investors?
Well, in all likelihood your funds will be limited compared to what a company may invest in new product development. And, even if your funds aren’t limited, you will probably want to minimise the money you put in upfront until genuine commercial interest has been established. So what is minimum requirement to turn your idea into a viable commercial proposition? Well basically you will need to answer three questions before being able to sell your idea or gain investment:
1. Is the idea protectable?
No company will license your idea, and neither will an investor back it, unless it can be protected to stop every other company producing the same product. You also don’t want to risk your idea being taken by a potential licensee or investor and so protecting the idea is a must.
In light of the last point, it is best to protect the idea yourself before presenting to potentially interested parties. A confidentiality agreement, a global patent search, patent pending status and a registered design application are all potentially essential elements to protecting your idea. Professional advice, from a Chartered Patent Attorney, on how to protect your specific idea is the most sensible route to go with this. (See the links at the end of this article.)
2. Will it work?
In some cases the answer to this question is a simple yes, but in some cases you will need to prove that your brainwave is possible. The best way to answer this question is to be able to present a working prototype. The prototype does not have to look attractive – it just needs to prove the functionality. If funds don’t stretch to a prototype, then a feasibility report detailing an independent viewpoint from a qualified professional on the viability of the idea may have to suffice. Always ensure a confidentiality agreement is in place before revealing your idea to anyone at all, other than Chartered Patent Attorneys.
3. Will anyone buy it?
This is the hardest question to answer. Once you have proved your idea works, if necessary, and sorted out adequate protection you are in a strong position to start answering this question. As seen on Dragon’s Den, the best answer to this question is to have letter of intent that state a retailer or distributor is prepared to buy x number of your product at x price. The way to achieve a letter of intent is to present your idea to as many different buyers as possible. The difficulty is that retailers and distributors will need more than your rough sketch, patent application or working model. They need to impressed by the idea and instantly see it’s potential. To do this you will probably need a product sell sheet.
A product sell sheet highlights the main features and benefits of your idea and includes images of your product as it is likely to look once it has been manufactured. You will need a professional product designer to either sketch and present your concept or ideally create a 3D model using computer aided design (CAD) and render it to look like the final product.
Then you need to get your product in front of potential buyers. Trade shows, face-to-face meetings, and direct mailings are all ways to approach industry representatives. A good sell sheet will do most of the talking for you, so don’t be nervous.
The product is a device that fits in the boot of a car to hold equipment. (Any more detail than this is still confidential at this stage.)
The first step was to conduct a global patent search to ensure patenting was an option. The search came back relativity clear and so the idea was developed to ensure it was possible using a product designer under a confidentiality agreement. Once developed adequately using CAD, a patent was drafted and filed by a Patent Attorney. The CAD model was then used to create a product sell sheet which was presented to Halfords among other retailers. Halfords wrote a letter of intent for an initial batch of a thousand units.
The inventor now had: patent pending on his idea; a global patent search indicating the patent was likely to be granted; an impressive sell sheet describing the product and a letter of intent. He now had everything he needed to secure investment to manufacture his product and set up his own company. Alternatively he could have used these tools to pursue to licensing deal with a product manufacturer.
In conclusion, your job is just to spark the interest of a potential licensee or investor who will ensure that your idea makes you a profit. To do this you need to answer three main questions: is it protectable, will it work and will anyone buy it. Professional help will be required, most likely, to answer these questions but the process described in this article should keep these fees to a minimum while maximising your likelihood of success.