How to earn income from a patent

by Xozepew Usaz We are always in the lead!

When registering the rights to development, as a rule, the question arises: what to do with the patent next?

When the owner of a patent for an invention, utility model or industrial design is a company that carries out or plans to organize the production of goods or services, the answer is quite obvious: it is necessary to implement the patented solution, and in case of its illegal use by other persons, carry out claims work in order to stop the violation and receiving compensation.

And what about a private inventor who does not have the financial and production capabilities to implement the development, but sees great prospects in it?

In this situation, there are two possible ways:

1. Attract investors or partners to organize a business using a patented object.

2. Transfer the rights to a patent to another person for a fee, i.e. sell your patent

Search for investors

An individual or an organization can act as an investor, who are ready to provide a certain capital for the creation and development of a project with the aim of subsequent profit.

Obviously, investments at the stage of starting a business are extremely risky, since there is a high probability of losing all your investments. Even if your development is a breakthrough solution, finding funding sources will be difficult and may not bring the expected result. However, having a patent as an intangible asset increases your chances of obtaining financial support.

The search for investors may include:

- preparing and sending a presentation with a specific justification of the expected financial result from investments,

- participation in specialized exhibitions and conferences,

- promotion of the project in the media space.

For business development, there are public and private organizations that accept applications for project financing.

Transfer of patent rights

To make a profit for the use of your development, you can also conclude a patent alienation agreement or a license agreement.

The contract of alienation of rights is essentially the sale of a patent or its share for a certain fee. After the alienation, the acquirer becomes the owner of the patent and can further dispose of the exclusive rights at his own discretion.

The license agreement does not deprive the owner of the patent rights, but only provides an opportunity for another person (the licensee) to use your development under certain conditions. The remuneration (royalties) under the license agreement can be paid both at a time and periodically (once a month, year, etc.) during the entire term of the agreement. The amount can be fixed or depend on the volume of production, sales and other indicators.

It should be remembered that state registration is required for the alienation agreement and the license agreement. At the same time, in case of termination of the patent due to cancellation, non-payment of maintenance fees or expiration of the document, the license agreement also terminates.