A patent is a vital document that establishes ownership of an innovation. However, simply possessing a patent will not bring the inventor any money. You must sell the patent, license usage rights, or market the product yourself to earn from your invention. If your idea has become a viable product after months of fiddling and experimenting, and you have a patent for your innovation after a successful patent search and application process. So, what's next?
Option 1: Take the money and run!
When you sell a patent, you can expect a speedy return on your investment. Thousands of inventions are patented each year, yet only a small percentage of those earn significant revenues if any at all. Some languages have been around for so long that their patent has expired. You can at least get some money for your invention if you sell your patent outright. Although a quick, painless payment may sound appealing, selling the patent throws up the inventor's claim to future benefits from his or her invention. Furthermore, until the product has been on the market for a long period, the money obtained from selling a patent may be insignificant. A patent buyer is unlikely to invest a lot of money on an unproven invention that is unlikely to make a lot of money.
Option 2: License the usage rights
For most inventors, licensing the right to create, use, or sell their product is the most profitable option. You keep ownership of the invention as a patent holder, and you get paid royalties on future sales of the product. An exclusive license can be granted to a single company or a group of enterprises. If you license your idea through a well-known corporation that already has the trust of the public, you'll have a better chance of making a lot of money. In addition, the licensee is responsible for any product malfunctions. Licensing usage rights, like selling a patent, does not ensure financial success. Your royalty cheques will be cancelled if the product fails to sell in the marketplace. Royalty payments range from 5% to 20%, so the patent holder would have to sell a lot of merchandise to get a lot of money. Relationships with licensees might sour, resulting in additional legal expenditures and headaches. Research the possible licensee and contact inventors' organizations like the United Inventors Association before giving away licensing rights.
Option 3: Be an entrepreneur!
All proceeds will go to your bank account if you create and market your idea yourself. However, legal and accountancy fees, business startup charges, and headache treatment could eat into those profits. The majority of inventors are terrible businesspeople. It is probably advisable to sell your patent or lease usage rights unless your idea requires little start-up cash and you are well-versed in corporate bureaucracy. Maintain a professional demeanor in your marketing activities. To promote your invention, write official letters and attractive brochures. A prototype, or at the very least a good drawing of the product, is also beneficial.
From the year 2009, almost $25 Billion worth of deals and 195000 patent assets were involved in 8100 deals. This humongous amount of money involved in 8100 deals shows the role of marketplaces where one can buy/sell/license their inventions. Unlike older times, today’s marketplace is powered by technology. Orthodox methods such as the inclusion of Brokers and one-on-one meetings to buy/sell/license patents are converted into online web-based platforms.
With the increase in competition for providing a marketplace, hundreds of patent owners face a dilemma every time they want to sell their patents. They're undecided about whether or not being listed on the first marketplace they came across is the best option. Furthermore, it is aggravating to browse through the websites of each marketplace, weigh the benefits and drawbacks, and choose one where they may put their patents in the hopes of a quick sale.
The problem of monetizing a patent portfolio isn't the only one in the IP landscape. Whether it's expanding a domain's patent portfolio or acquiring patents for defensive purposes to operate freely, it's common knowledge that patents listed on marketplaces can be purchased for a lower price than reaching out to individual patent owners, who will inflate prices if they believe the buyer, is a large entity.
Marketplaces to Buy and Sell Patents
Xango – Xango is an IP marketplace running particularly in the US. It offers many valuable services such as buying/selling and licensing of patents that help inventors to get benefits from their hard work. This platform allows both buyers and sellers to register freely and interact with each other until the deal is finalized. Support for documentation and expert consultation is also available on Xango.
Inpama.com – It is a global marketplace that allows both buyers and sellers to utilize the platform for free after registering, removing any potential financial hurdles. One of the unique features of this website is that it includes a tutorial for inventors on how to sell their patented ideas more quickly and efficiently. It may not cover every step of the process – such as how to submit a patent application or perform a novelty search – but it's a good starting point for both vendors and purchasers. This is a very valuable bonus for a seller. As a buyer, you can rest certain that the inventors on the site are well-informed and capable of properly communicating their concepts to you. However, because there isn't a large number of patents to look over and choose from, it might not be the greatest option on this list if you have a very clear vision or want to search through a variety of patents.
PatentAuction.com - While there are some "free" patent marketplaces, many "free" patent marketplaces will nonetheless have hidden fees or expenses. PatentAuction.com, on the other hand, is one of the only completely free (and legal) resources available! For over 15 years, registering patents to sell and exploring existing patents as a buyer has been relatively quick and uncomplicated on this platform. Because of its popularity, it is frequently updated with new creations by a range of inventors. This platform, however, has a restricted number of categories. As a result, search functions might be a little challenging, especially when so many patents are designated as "other" since they don't fall within the few categories provided.
Patents.com - This resource isn't known for its attractive design or user-friendly website, but it does provide useful information. Patents.com's marketplace function has been operating for a long time and serves as a search engine, marketplace, and instructional resource for everything related to patents. It's crucial to mention that the search engine function is the best part of this resource, as it will make your life a lot easier in this area. Buyers won't be welcomed with a huge range of selections, and sellers may not have the broadest customer base as a result, but the free features and simple searching make it worth a look at the very least.
IP Marketplace - IP Marketplace has been a resource for patent/patent application, design patent and utility patent models, and trademark listings for over a decade, and is managed by the Danish Patent and Trademark Office. It was also redesigned in 2017 for a better user experience! The filter options on this website are one of its best features. If you have to read through page after page of inventions while looking for patents (especially if you're buying or selling), it can be a tedious procedure. Users may easily identify the intellectual property in certain categories, nations, and even cooperative agreement kinds thanks to extensive filtering. However, the categories might be weirdly specialized at times, causing users to have the opposite difficulty if they prefer wider phrases like "technology" rather than "food tech" or other specific categories. Finally, IP Marketplace has a terrific application that allows customers to evaluate their intellectual property for free. Even if you end up listing on or purchasing from a different site, this might be immensely useful if you're still trying to figure out how much your patent is worth or what type of patent you want.
Idea Buyer - Idea Buyer is one of the largest sites for buying and selling patents in the world. Since its inception in 2007, this site has helped entrepreneurs sell billions of dollars worth of patents on a wide range of inventions! As you might expect, this is a very popular marketplace that will provide you with a wide range of alternatives as a buyer and loyal clients as a vendor. It allows patent and invention owners to list their patents and inventions for free. Buyers can also take advantage of free registration as part of their experience. Though it may not have all of the same features as paid resources, the lack of a financial barrier to paid registration ensures that you will be able to communicate with a diverse group of consumers and merchants.
Yet2.com - Yet2.com, one of the earliest marketplace platforms (established in 1999), has developed from a simple online marketplace to a consultancy service for inventors. They've worked with a mix of solo entrepreneurs and large corporations during the course of their twenty-year existence. Patent owners can choose from a range of membership categories, allowing them to be more flexible with their spending. Buyers do not have to pay anything to register, view, or ask inventors questions about their listings, but successful transactions incur a commission. Finally, experience is difficult to top, therefore if you have any money to invest in the experience, this is a platform worth considering.
IAM Market - IAM Market is a newer business that has only been available since 2015 but has made strides in the last few years. If you are a buyer, this resource may be considered free, but if you are a seller, it is a paid service. This platform has 22 suppliers who offer patent portfolios on the site, although patent owners are urged to sign up nonetheless. It does an excellent job of simplifying the procedure, making it a terrific pick for people who are new to the game as well as folks at any point. Intellectual property owners can use IAM Market to profile their licensing, sales, and technology transfer strategies. Buyers can look for IP assets by industry, technology, and even transaction type. Of course, great service like this comes at a cost, but if that isn't a deal breaker, it's worth investigating.
Tynax Patent Library - Tynax began as a simple patent marketplace, but has subsequently expanded to include a patent library. They've also been leading patent brokers for over 15 years; thus, their knowledge has contributed to the development of a superb platform. Like the library it aspires to be like, everything on this site is carefully arranged and labelled. Buyers can explore certain niches using subcategories, while sellers can better classify what they're selling using subcategories. Sellers can sign up for a free account and list their patents, then pay a fee after successful sales and transactions. Buyers and sellers that are interested in this experience can still use Tynax's broker services for an additional fee. This tool also acts as an IP strategist for buyers, helping them build a strong defensive and offensive portfolio. They can provide Tynax with a list of competitors they want to avoid, and Tynax will take care of the rest! As you can expect, such a comprehensive and extensive service comes at a hefty price, therefore it isn't the greatest alternative for buyers/sellers on a restricted budget. The cost of an annual membership is comparable to the cost of getting a single U.S. patent, so expect to pay thousands of dollars for the incredible benefits.
Royalty Exchange - If you're an artist, you could be interested in buying and selling royalties specifically to mix things up a little. If this is the case, Royalty Exchange is an excellent resource. This type of resource allows artists to feel more financially in charge of their future, allowing them to concentrate more on the art and the market experience. Royalty Exchange connects artists with investors to help them better support their careers while also allowing investors to work with world-class creative. The transparency of this platform allows both artists and investors to actually grow and benefit from the experience, creating revenue and establishing more long-term careers.
IPNexus.com - Because of its widespread use, it's likely that you've heard of IP Nexus. Since their inception in 2012, they've done an excellent job of making IP information and services available and affordable (but not necessarily free) to smaller businesses and startups. A Q&A forum where experts can answer customers' IP inquiries and assist them in better comprehending the trip, they're about to embark on is one of the unique features given here. They also have a legal director, a job board, and, of course, an intellectual property marketplace. After registering for free, patent owners can list their patents. The expense is covered by a matching fee (12 percent for for-profit companies and 4% for nonprofits) assessed when successful transactions are completed. Any registered user has access to as much intellectual property as they desire. Submitting an interest in buying is also free, however, the free option disables a number of features on the websites, including the ability to see descriptions and patent numbers. As a result, paying a fee for premium membership (about $200) is the best way to get the most out of the site.
ICAP Patent Brokerage - It has been in business since 2006 and is well-known for its auctions in the United States and Europe. Sellers must first submit their patents to the ICAP website, where they will be thoroughly reviewed before being accepted. Summaries and claim charts are generated to build up the catalogue contained in the bid once it is awarded. Buyers will have the option of purchasing patents privately or participating in a public auction. After that, they pay a 10% premium, and sellers pay commissions based on their ICAP contract.
IP Trader - IP Trader, a full-service firm that assists corporations, law firms, colleges, governments, and investors, is another popular broker option. They help with the monetization as well as the commercialization aspects of the process. Acquisition, valuation, licensing, and selling are just a few of the brokerage services they offer. They also offer patent claim mapping and can assist users in using foreign IP rights to expand beyond their home country. Although they are based in New York, they have offices in a number of other U.S. locations as well as in China.
Adapt IP - Adapt IP is interested in assisting you if the patents you are looking to acquire or sell are related to technological innovation and change. There's a good possibility you fall into this category, so continue reading. Above all, this firm is dedicated to assisting patent owners, whether they are individual inventors, investors, or running firms. They don't limit their transaction advising services to just technology patents, but rather look at all industries (provided the patents are of high quality). In a world where so many ideas and breakthroughs overlap throughout the market, managing patent transactions across a wide range of industries are becoming increasingly critical. This is why, regardless of the patent in question, having a broker with diversified experience is quite beneficial, and why Adapt IP is a wonderful option to consider.
Transactions IP - If you own a patent, you've finished your work as an inventor. If you're a buyer, you want to make sure you're getting good patents from hardworking inventors. This is where Transactions IP can help you sell your high-quality patents. Patent sellers can submit their patents for review and consideration. If Transactions IP finds your patent to be worthy of their requirements, they will contact you to discuss the next steps, and the rest is simple. Unfortunately, if your patent does not meet their value guidelines, you will be charged an upfront fee in addition to the normal operating costs. This is only one of the many reasons why in the realm of patents and IP law, hard effort and diligence are essential. The broker services provided here follow a thorough procedure to ensure that both the buyer's and seller's demands are addressed. They charge buyers a price that is made up of hourly costs and a percentage of success. Fortunately, buyers may set their budget at the start of the process, so there should be no unexpected costs.
True North IP - True North IP is an excellent choice for intellectual property transactions across North America, Asia, and Europe. They've managed deals worth hundreds of millions of dollars and can help you through the process. True North purchases patents and works on high-value transactions and key IP matters with a restricted group of worldwide clients. This enables highly serious and high-profile clients to maximize the value of their intellectual property and profit fully. Funding litigation, selling intellectual property and royalties, licensing/litigating intellectual property, purchasing patents, and advising clients are among the services provided.
Marathon Patent Group - Marathon Patent Group is a dedicated and talented choice to consider if you're looking for a patent aggregator. Their key areas of expertise are commercialization and licensing. This company's business model is around purchasing high-quality patents that are already in litigation and determining who else may have infringed. Then they either ask infringers or potential infringers to obtain a license or initiate a lawsuit against them. This is a frequent patent monetization method that makes the most of patents that have already been through a lot of litigation battles. If you possess a patent and are tired of being sued, here is an excellent way to sell your inventions.
Google’s Patent Purchase Portal - If all of the strange names and platforms make you nervous, you can always rely on a trusted source that everyone will recognize. Google Patents Site is a fantastic shopping site with a name that will put you at ease. Google first launched this program in 2015, with a series of highly successful pilots. Sellers can submit patents with full forms for consideration, with rewards ranging from $3,000 to $250,000 at the upper end. While the rewards aren't spectacular, it is a trustworthy resource for lesser ideas and patents, and it is efficient and straightforward to use, so it's a wonderful option unless you're looking to retire from the sale of your patent.
RPX - RPX was created as a defensive aggregation company with the goal of lowering the risk of NPE patent assertion and litigation. They have over 320 members and have purchased over 40,000 patent assets, saving them over $3.8 billion. It would not be a free choice because the corporation offers consumers the option of purchasing insurance or becoming a member. They do, however, sell patents, making it a valuable resource for buyers. If you are a buyer, you will select a patent portfolio to purchase and will be given the option of filling out buyer information forms so that a representative can contact you. You should definitely contact them ahead of time for information on any fees on the buying end, as they do not say it directly. A fair market price is guaranteed for patent and other IP owners, with payment guaranteed within 90 days following a selling offer.
Allied Security Trust - Their cost-sharing strategy is fairly similar to RPX's, although they were the first to implement it and take a more traditional approach in general. AST has processed over 138,000 patent assets since its inception in 2007. Around 2,500 assets worth over $420 million were also purchased. Their business concept is around pooling funds from various sources to acquire intellectual rights. Members will carefully examine intellectual property that is put up for sale, and the acquisition will only take place if parties are genuinely interested. Both buyers and sellers benefit from this since sellers get fair prices for their ideas and buyers to pay a fraction of what they would have paid if they sought to obtain the rights themselves.
Honorable Mentions – Patent Mall and PCTXS.com, IdeaConnection, USPTO eOG:P, and Ocean Tomo Big-ASK™ Market, Vibrant IP, IP Offerings, Western IP Law, Aqua Licensing, IP Investments Group, Clear View IP (Acquired by Deloitte), and New England IP.