Did you know that patent applications to the US Patent and Trademark Office (USPTO) continued to grow, hitting an all-time high of approximately 430,625 in 2024, while patent grants increased marginally following several years of decline?
If you want to sell or license your patent, you must understand your rights first. Having a brilliant invention is not enough. You also need to deal with the legal process. To learn how to sell your patent, you must meticulously prepare before seeking suitable buyers.
There are a few steps that you should take before negotiations commence. Following these steps will maximize your profits and guarantee the protection of your interests.
Understanding Your Patent Rights
To successfully market or license your inventions, you must properly understand patent rights. A patent allows the patentee to enforce an ownership right against other people through negotiation.
Understanding the extent of the rights, like exclusivity and duration, is important so that you do not lose the potential income of your product. You are advised to understand the concepts of infringement and enforcement fully since these issues will protect your invention, conserve your interests, and give you confidence to present it to an interested buyer or licensee.
According to patent lawyer Steve Zemanick, working through the lengthy process to obtain a patent alone can prove difficult. You may benefit from help from an attorney with extensive knowledge of the process.
You must realize that you are part of an inventor community, and this shared knowledge can provide you with confidence and clarity.
Preparing Your Patent for Sale or Licensing
Before selling or licensing to someone, it is necessary to attract interest from a buyer or licensee by passing the risk. You also need to have complete and current documentation, a copy of the patent itself, and possibly some research and market analyses.
Advertise your patent’s features and benefits to convince potential buyers of its value. Prepare much publicity emphasizing the importance of your patent. Then, proceed to explain the status of your patent and any license that might be in existence.
In this phase, address any issues your potential buyers may have regarding the patent and demonstrate its practical uses and market potential.
Identifying Potential Buyers or Licensees
Search for potential buyers and licensees for your patent. Find which companies in your industry might benefit from the invention.
Look for companies that can share your vision and values, which can translate into highly productive partnerships. Attend industry shows and events, join forums with a similar focus to yours, and then network within the circle of professionals who may have an interest in your patent.
Reach out through LinkedIn to the decision-makers. Do not be afraid to request an introduction to mutual contacts. These relationships provide a network for your innovation that promotes collaboration and support for this process.
Negotiating Terms and Agreements
Once prospective purchasers or licensees of your patent have been identified, the next step for negotiation will be the terms and agreements that indicate the value given to the invention. Share your expectation and listen to the other party’s expectation so that both feel heard.
Discuss payment, royalties, and other considerations you expect from the deal, and maintain flexibility as much as you can regarding changes. You are welcome to insert exclusivity, territory, and duration relating to the agreement.
Trust is important, and you should keep the processes transparent. Keep in mind that you’re not just selling a patent, but you’re also entering into an association that can help both grow. Together, you can identify terms that will facilitate the realization of both your visions.
Finalizing the Transaction and Protecting Your Interests
Protect your interests to the maximum extent before signing any agreement. Go through the agreement and see whether all the terms have been captured. Anytime you are uncertain, do not be afraid to seek the counsel of an attorney. An attorney might help you avoid typical mistakes.
Ask for records of everything, such as the correspondence exchanged, any changes made during negotiations, and so on. If you license your patent, keep licensees aware of their rights and obligations.
You also need to think about the inclusion of clauses for the resolution of disputes and changes in circumstances once they arise. In working toward this, you will protect your interests while building trust with the buyer or licensee.
