Negotiating a Licensing Agreement Part 2

In this video, Stephen Key and Andrew Krauss dive deep into the importance of key terms in licensing agreements, specifically focusing on performance clauses.
Stephen Key emphasizes how critical it is for inventors to protect their inventions with minimum guarantees, a powerful tool to ensure that companies actively market and sell your product. Without this clause, companies could potentially hold your idea without making significant efforts to sell it, costing you potential royalties.
Stephen Key shares his personal experience of relicensing his technology multiple times, thanks to the protection offered by these performance clauses.
Earn money from your ideas with the help of inventRight. We help you license your ideas, inventions, and products for passive income.
Find out how by calling [phone] or emailing [e-mail]. Do you have the next big hit?
New to the licensing business model? Educate yourself first.
- Read “One Simple Idea”: amzn.to/4fwVVOT
- Explore inventRight’s Free Inventor Resources: bit.ly/3AaGko2
About Stephen Key, inventRight Cofounder
Stephen Key is an award-winning inventor, renowned intellectual property strategist, lifelong entrepreneur, author, speaker, and columnist. He has over 20 patents in his name. The dozens of concepts he has brought to market have retailed in Walmart, 7-Eleven, and Disney stores and parks worldwide and been endorsed by Michael Jordan, Alex, Trebek, and Taylor Swift. He has defended his patents in federal court against the largest toy company in the world, Lego.
In 1999 he cofounded inventRight with inventor Andrew Krauss to teach others his unique process of harnessing the power of open innovation in the licensing business model. His best-selling book about how to license an idea, One Simple Idea by McGraw-Hill, has been translated into six languages.
He has spoken at Stanford University, Florida State University, the University of Michigan, UC Merced, the USPTO, World IP Forum, University of the Pacific, Cal State Fullerton, Washington University in St. Louis, the Art Center College of Design in Pasadena, the Economic Development Agency for Northern Ireland, and many more.
He has written five books related to product licensing and intellectual property and is a longtime contributor to Forbes and Inc.
From 2018-2019, he was honored to serve as an American Association for the Advancement of Science-Lemelson Invention Ambassador.
In 2021, Mojo Nation named him as one of the 100 most influential people working in the toy and game industry.
In 2022, World IP Forum named him a “Most Influential and Inspiring Leader Of All Time.”
About Andrew Krauss, inventRight Cofounder
Andrew Krauss is an expert on licensing products ideas for passive income. He has been helping creative people bring their concepts to market with less risk and more success for 25 years as a cofounder of inventRight.
During his tenure as president, he grew the Bay Area Inventors’ Alliance group into one of the most active and well-established inventor associations in the country. In addition to advising the White House on innovation, he has been featured as a speaker at USPTO conferences and on NPR’s Science Friday.
About inventRightTV
inventRightTV is the leading source of information for people who want to earn money from their ideas for new products on KZbin. With 80,000 subscribers, average monthly views between 64,000-78,000, and average monthly impressions nearing 1 million, becoming an inventRightTV sponsor ensures you reach an extremely targeted audience of inventors, product developers, designers, and entrepreneurs. Email [e-mail] for more information and to apply.
------------
inventRight, LLC. is not a law firm and does not provide legal, patent, trademark, or copyright advice. Please exercise caution when evaluating any information, including but not limited to business opportunities; links to news stories; links to services, products, or other websites. No endorsements are issued by inventRight, LLC., expressed or implied. Depiction of any trademarks/logos does not represent endorsement of inventRight, LLC, its services, or products by the trademark owner. All trademarks are registered trademarks of their respective companies.
Reference on this video to any specific commercial products, process, service, manufacturer, company, or trademark does not constitute its endorsement or recommendation by inventRight, LLC or its hosts. This video may contain links to external websites that are not provided or maintained by or in any way affiliated with inventRight, LLC. Please note that the inventRight LLC. does not guarantee the accuracy, relevance, timeliness, or completeness of any information on these external websites. The inclusion of any links does not necessarily imply a recommendation or endorse the views expressed within them.

[@margaritaescobedo841]

I find this this video extremely interesting and important. I'm writing notes for my preparation of showing my invention. Thank you Stephen and Andrew, much appreciated. Stay safe. Maggie

[@diamondrooster6408]

Amazing! thank you so much, great advice! I got your book, again its Amazing! :)

[@favdup2134]

I loooove! this man's attitude "Stephen Key" talking about attitude, he have a great!!!!! attitude, wow!!!!

[@melindaalic8370]

Would you have a list of interview questions that we should be asking the companies? I realize it will be a case by case situation but having some typical or general interview questions that you would recommend would be great. Thank you in advance for your son!

[@Iamstrongd]

Absolutely Amazing Did EVERYTHING a you guys suggested filed PPA made my own prototype and have a company interested Been talking 3 months Company wants to represent me Finger crossed all goes well You guys are worth gold!! Thank You Stephen and Andrew YOU GUYS THE BEST!!!!!!

[@Iamstrongd]

I Have the BOOk also ONE SIMPLE IDEA!!! Fantastic!!!!

[@raquelandrea6529]

Must watch!! Fantastic advice! So grateful for these guys! Thank you!!!

[@shirleyjames4161]

I am just beginning to seek information for licensing my art which was left to me by my late husband and need expert information! Thanks I want to know more about you and your services. ShirleyJ

[@inventRight]

+shirley james Give us a call: inventright.com/contact.

[@Barbiecakes808]

You guys are the REAL DEAL ! Your videos are insightful and very informative. I and others can clearly see the energy, enthusiasm, and Love that you have put into your presentations, videos, and books. Best licensing ( real people ) Team on the web hands down ! I have learned so much and have lots to learn , but this gives people HOPE that they can do it too ! Thank You so much for helping people make their dreams come true .

[@inventRight]

+Barbiecakes808 Wow, thank you! We're really having fun and enjoying sharing good content. Appreciate it. - Stephen

[@amazingwarrior4]

it's Awesome. I'm really learning ;)

[@inventRight]

Keep it up :)

[@marke.8334]

If you all haven't seen a documentary called... It's worse than you think.. by Revelations of Jesus Christ ministries... I suggest you do...All praise and glory to the most high Jesus Christ

[@rayazand967]

A+++

[@ceylonin7289]

Hi guys, I love your stuff, it´s amazing advice

[@inventRight]

Thanks for watching!

[@jaketaylor2875]

Thank you for taking the time to share. I have gained so much from watching your videos. The book "One Simple Idea" was a great read, and I am turning those steps into action. I look forward to your upcoming videos! Jake

[@stephenkey3137]

Thank you Jake!

[@eddiefroufrou]

Gawwwd Andrew, quit interrupting Stephen!

[@donnabeattiedreamerbydesign]

❤️

[@karthiiklucky]

Respect from india to both of you 😂

[@addmeons3701]

We have an organization of inventors offering to be our licensing broker. However, they want 50% of the deals they put together. What's your advice?

[@inventRight]

We teach inventors how to license their own ideas for products. We believe in the power of educating yourself, so you can go out and get your next deal. Our success speaks for itself: www.inventright.com/new-testimonials

[@redbootshomestead558]

Hi guys awesome Channel thank you!! Question: can I have my inventions licensed in two different countries?

[@inventRight]

Yes. Read Stephen's article "How to License an Idea to More Than One Company" for more information: www.inc.com/stephen-key/how-to-license-an-idea-to-more-than-one-company.html. Thank you for watching!

[@MolloRelax]

Can you tell me that, ...if I were to modify the angular shape of a specific item, to make it more comfortable to operate in its niche market...., it would constitute a potential candidate for licensing. Thanks...you guys rock

[@inventRight]

That sounds like a simple improvement. It could be a good fit for licensing. We'd be happy to talk to you about it. Reach us here: www.inventright.com/contact

[@davidpage7838]

Hi Stephen and Andrew Could you give an example of what to put fir minimum guarantee what numbers should I put in there thank yiu

[@inventRight]

Hi David. Good question. Andrew is going live on our channel today at 4pm Pacific to answer questions from viewers - please attend to ask and get your question answered! kzbin.info/www/bejne/oZKqm3SfibqLotU

[@pdub2762]

Had to see this part 2. Ty sirs💪

[@omyachinhead873]

LOVE YOU GUYS!!! Can't wait to view the next one!! Thank you so much!!

[@stephenkey3137]

Thank you!

[@joephantom8288]

Andrews funny😂😂😂💡

[@rocketskyvolta3004]

Help. I'm a t-shirt designer that did a collage using NBA players, but cannot print layout design art without a license agreement. What steps do I need to take so I can sell design on website store? Thxs

[@coxdesigns2509]

With me investing the 3000 for prototype they said they would give 14% royalties

[@dianejordan685]

How can u confirm if u have a legitimate patent?

[@inventRight]

What do you mean?

[@williamjefferson3605]

Would like to here about deriving a royalty rate.

[@inventRight]

Andrew is going live on our channel today at 4pm Pacific to answer questions from viewers - please attend to ask and get your question answered! kzbin.info/www/bejne/oZKqm3SfibqLotU

[@Halo_people]

thank you for your brilliance. And assistance.

[@inventRight]

Pleasure is all ours.

[@ImbentongBentongTrimond]

I`m excited to get to this part on my career~!

[@inventRight]

Excellent. We are here to help if you need us. Keep inventing! - Andrew Krauss, inventRight Co-Founder ( Call, email, book an appointment or request more info about how we can help by visiting us here. inventright.com/contact/ )

[@hughjanus4040]

Why not get the Dana Carvey guy to be in the same room, or get the same computer so he doesn't sound like he is in a crappy tunnel? Why the gaming headset? You guys have good info, but it's a hokey presentation. Maybe have a pre-production meeting where you plan how many segments it will take? What if you both had clocks in the room so you knew how long the segment you're winging is? Hey guys, it can only go up from here! But really, the material is good, and I'm grateful for it so thanks, truly

[@inventRight]

Thank you for watching!

[@rickcongeni2347]

You guys have helped me sleep better at night! The Inventing process can drive you insane. Now that I have learned from your videos I am a product developer I am much more calmer....lol.

[@inventRight]

Glad to hear that Rick!

[@esam7865]

i HAVE A QUESTION...Where do I license my product to a company that sells similar products or a manufacture that makes them?

[@inventRight]

Not sure what you mean. Can you elaborate? Do you mean how do you identify companies that are looking for ideas? We have a list on our website inventright.com.

[@esam7865]

For stance I have a smartphone case idea where should I go to get a licenses deal? Should I go to a manufacturer that makes phone cases or go to a business that cells phone cases?

[@stephenferreira427]

How do you deal with a situation when they breach the contract so that you don't jeopardize future deals?

[@inventRight]

This articles will show you how to get the upper hand in a licensing contract if your licensee breaches: www.inc.com/stephen-key/receive-a-blank-royalty-check-don-t-freak-out.html.

[@civilizedagesabers]

Can I hire you?

[@inventRight]

We offer services. Please visit the inventRight website or call [phone]

[@MolloRelax]

Great info guys.....I have a great tool to submit to a relatively small niche in the construction industry.My question is this. What if the niche market; for which the product is designed ; gets saturated quickly; ,due to the fact that; the product does not wear out quickly enough to keep the demand strong;..Would that be a deterrent with the licencee manufacturer....meaning...would they likely refuse to give a minimum sale guarantee for that reason alone?

[@inventRight]

Interesting question! Not necessarily. An expert in that field who understands sales/manufacturing could give you better insight than we could.

[@inventRight]

Thank you for watching. If you're looking for more help, you can reach us here: inventright.com/contact-us-today.

[@coxdesigns2509]

Would you be able to have a performance clause for marketing and how would that look? For example I have a manufacturer who says they want a 2 year contract non-exclusive but they want me to invest 3000 to make a prototype so they can market pitch the idea for the first year and get purchase orders and then the second year manufacture the purchase orders up to 200,000 so how could I get them to pay for prototype and give them a performance clause for the first year and second year?

[@inventRight]

Our advice is to be wary of any company that asks you to spend too much of your own money on prototyping or design, for which there are no guarantees. That is a good royalty rate. But again, that's taking on a lot of risk for yourself. How is their track record of bringing other licensed ideas to market?

[@coxdesigns2509]

inventRightTV they tell me that it's confidential I think they may not be the right company.

[@jb1973]

I like what you guys are saying but my idea is a mobile app will this plan work me?

[@inventRight]

Mobile app licensing is a new field we are learning more about - there is so much intellectual property being debated around software right now, it is difficult to establish perceived ownership. Look for more information from us on app licensing soon. Thanks for watching!

[@jamesgraham6796]

Two thumbs up guys!

[@ItssJayy1]

Amazing insight can you do more on the terms in contracts etc

[@stephenkey3137]

hash illy good morning. Great idea! Thanks for watching!

[@saeidsarir8833]

terrific

[@bobruiz6548]

Great info in both Part I and II. Thanks, gents, appreciate your frankness and information.

[@stephenkey3137]

Bob Ruiz Glad you liked them!