Why do I need to do a business plan if I just want to sell or license my idea? It is a great question and we get it all the time.
The suggestion of doing a business plan is important for many reasons. If you are fortunate enough to be able to speak to someone or a company that might license your idea or product you need to be prepared. The interested party may ask you any or all of the following questions (example is for a product):
When you do a business plan, you go through all of these things because at the end of the day, if it cost too much to make them, it might not be worth it. There are other costs most inventors do not take into consideration such as Boxing, Labeling, Warehouse space, Marketing or sales reps commission
And there are many other costs involved. So the companies considering your product need to know that you know your business and how they will make money if they license your product. In doing the business plan, you will better understand the real costs involved and will be able to explain why they would want to take on your product. You will also have the data if you should decide to create the business and manufacture it yourself.
Every company we have pitched to has asked many of these questions. They want to know you understand the process. I have seen them ask inventors these questions and when the inventor did not have any answers, the comment is – “Why should I care about your product more than you do if you haven’t taking the time to find out this information?”
There is a lot to consider, after you have come up with the idea, in order for you to make money. It is possible and there is help available.
Keep Inventing Daily!
You have, what you think, is a fantastic idea that will make millions and be perfect for Shark Tank but you don’t know what to do or where to start. Here is a list of the first things to do:
After starting the process, you will see that there is a lot to do before you spend money on a patent or on prototypes. There is help available and it will take time. Just Keep Inventing Daily!
We just wrapped up our Deal Flow Summit in NYC and it got me thinking about how pitches go wrong. Here are 7 ways to bomb a pitch:
1) Dear Sir/Madam: If I read Dear Sir/Madam or similar generic greetings, it’s an instant-archive. It’s not because I think so much of myself that I need you to spell my name right but I do need you to address it to me. Dear Sir/Madam is the clearest possible signal you could send that you are blasting your pitch to anyone and everyone.
2) Buy Now! and other used-car tricks: investing in or acquiring a business is a serious, long-term investment decision. Pressure tactics and hard sells are not only inappropriate, they’re often counter-productive. Respect the process and don’t pressure the investor the way a used-car salesman would.
3) Fail to follow-up: You can make the best pitch of your life and have the investor on the edge of his/her seat, but if you don’t follow up it could all be for naught. Remember that your pitch settles in somewhere between the other 20 meetings, phone calls, and pitches that a busy executive will have any given day.
4) Cheap Out on Presentation: It is inexcusable today to have a cut-rate presentation. Whether you’re using PowerPoint or Indesign or a top-end software, make sure that you take the time to edit your presentation and make it look professional. Send it around to friends and family. An executive that we’re partnered with recently sent his presentation to his mother for review and guess what? She caught more mistakes than I or anyone else who reviewed it did. Lesson: it only costs you time to edit your presentation and it can cost you millions to skip this step.
5) Talk about everything but the main event: You’re meeting with the prospect to talk about your company or deal and you want to build rapport so you talk about your kids, what sports you both enjoy, and every other topic of conversation EXCEPT what you’re both there to discuss. I don’t know how many meetings I’ve thoroughly enjoyed but left without any idea what the company did, what they were seeking, or how I could participate. When you’re meeting with a busy executive you’re working in a set time window and if you spend 50% or more of your time building rapport, you don’t get any extra time or brownie points for knowing that he likes fishing or has a cousin who lives in your hometown.
6) Forget the financials: When I’m meeting with a potential acquisition target or a company seeking funding, I’m zeroing in on the financials. Too often, I attend what I expect to be a formal, serious meeting to discuss a potential investment but the other party is ill-prepared to discuss the numbers. Not only is this a sign that you’re unprepared, it’s a waste of everyone’s time. I and a lot of other potential investors will likely reschedule the meeting for a time when you have the necessary details to have a real discussion. Some investors, though, won’t give you a second shot.
7) Meet with the wrong person: I recently scheduled a call to introduce a company we’re invested in with what would be a huge account. The team prepared for the meeting and when I jumped on the conference call we quickly learned that my contact wasn’t the decision-maker and was unfamiliar with the company’s sector. The lesson I took away is to make sure that the person you’re meeting with is A) qualified to make the decision B) familiar enough with the sector and C) taking the meeting seriously. In my case, the person we were meeting with was a principal at the firm (meeting criteria A) but a friend and thus willing to take any meeting I set up (violating criteria C) and unfamiliar with the sector (violating criteria B).
I hope that these lessons I shared help you craft an amazing pitch.
The Private Equity Investment Group
Key Biscayne, FL
Join us and Get Discovered! Who knows, you may meet someone to fund your idea as well! You won’t want to miss this great event!
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Tuesday, May 10th starting at 6:00 pm, Startup Grind Orlando & Google for Entrepreneurs will be hosting founders of Fattmerchant, Suneer Madhani & Salman Rehmetullah. Learn more and get your ticket here, and use code “CATALYST” to get $4 tickets (normally $12)!
The event kicks off at 6:00 pm with a casual hour of craft beer, pizza, music, and networking. Around 7:00 pm we’ll start the fireside chat with our featured guest, followed by Q&A and more beer and networking.
Grab your ticket(s) here, and remember to use code “CATALYST” to get them for only $4 each.
See you there!
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While every inventor wants a magic list of companies to submit their ideas to, very few real lists can be found. Below are links from a list compiled by a company out of Cleveland Ohio named NineSigma. (https://ninesights.ninesigma.com/resources)
Nine Sigma has been around for years, and while they don’t work directly with inventors, they do develop Open Innovation outreach for their corporate clients. Who knows maybe they have a program you can get involved in.
For now – take a look at their list below of companies you may want to submit your invention to. While I can’t personally vouch for this list, I can tell you that NineSigma has done a pretty good job of compiling it.
3M 3M accepts only patented ideas through this corporate website. This means that all submitted ideas must be protected.
AbBInBev Anheuser Busch InBev is always looking for new ideas to help make their brands refreshing and relevant.
Aqua Leisure Aqua Leisure is a maker of pool and swimming gear that invites Solution Providers to submit new ideas through their site.
Audi Production Award This is a contest sponsored by Audi to create innovative new visionary ideas in the industry and science.
Avery Dennison Particularly interested in novel and patented ideas that can advance Core Capabilities including: Decorative and Information solutions for label and packaging applications; External embellishment, identification, and tracking solutions for retail; Sustainable materials and adhesive films; Other adhesive and bonding solutions
AkzoNobel Seeking new ideas that are both brilliant and applicable solutions that are connected to their work in any way.
BAE Systems Creating innovative solutions from the amazing ideas of our network.
BASF This is a global technology scouting website that encourages visitors to browse and check into new ideas.
Beiersdorf Innovations are essential to Beiersdorf’s success. As a global company we have always cooperated with innovative partners. With Pearlfinder we want to further expand our global network.
Black & Decker Black & Deck receives thousands of idea submissions per year for new products through its website. It is interested in new products and ideas that will help meet consumers’ needs.
BMW BMW has founded the Co-Creation Lab so people interested in cars can meet share ideas and concepts.
Bosch As a user of power tools, you can get involved in our development. Do you have suggestions or concepts for innovative applications, products or technical solutions? Technically good and market-relevant ideas are welcome at Bosch Power Tools.
Boston Scientific Innovation Portal Do you have an innovative idea? We are testing out new ideas and technologies constantly and we welcome your ideas that could improve the health of patients around the world.
Cisco iPrize One of Cisco’s most public innovation Challenges, which has closed but may serve to spark ideas.
Clorox Clorox’s Hive open innovation hub
Colgate Colgate is looking for patented ideas to add to its product line. Submit patented ideas via the corporate website.
Crown Holdings Inc. Crown details its idea submission process on its corporate website. The company is looking for ways to enhance convenience, improved functionality and make its products more visually appealing.
Dell Ideastorm Dell’s Ideastorm website accepts ideas from the community.
Dow Chemical Dow Chemical accepts ideas through its Collaborate to Innovate submission form on its website.
Dremel Innovations Portal Invites you to tell about your concepts for innovative applications, products or technical solutions in the category of multitools. If you have an innovative and market-relevant idea and you know how to implement it, then simply send it to Dremel.
DSM A great example of a b2b organization embracing the open innovation mindset, with their Chemelot community for the chemical industry.
Elmers At Elmer’s we’re proud of the products and inspiration we provide to encourage consumers to create, build, and learn. They inspire us to do the same. Consumer needs are changing daily; their expectations and behaviors change over time. In order to maintain relevance, we strive to grow and evolve with our consumers through innovation
Evriholder Evriholder licenses products in variety of industries, including food. It allows inventors to submit ideas through its website.
Faultless Inventors Faultless Inventors is a company that purchases products or licenses them for the inventor that either has a patent or is going through the approval process. It is not a licensing agent or an invention submission company.
Fiat Fiat continues to accept ideas for future car models and features after developing a car based on a crowdsourcing project.
Ford Motor Company Ford Motor Company accepts ideas for vehicles from inventors through its website.
General Dynamics The EDGE® Innovation Network is a revolutionary model where industry, academia, and non-profit organizations, along with government entities, collaborate in an open community environment to rapidly deliver new technologies and innovative capabilities to warfighters and first responders
General Electric GE accepts ideas for products through its corporate website. The GE Submitted Ideas Operation handles all unsolicited and voluntary ideas that are submitted to the company.
General Mills We believe that there is a great opportunity for us to enhance and accelerate our innovation efforts by teaming up with world-class innovators from outside of our company.
GlaxoSmithKline With an ever-changing global consumer marketplace demanding better quality, better value and improved performance, innovating our products is key. We know the importance of bringing in external ideas and recognizing that the best ideas often come from innovators like you.
Henkel Henkel’s Innovative Partnership Program allows inventors with patents to submit their invention to the company through an online form on the corporate website.
HP HP’s Open Innovation team collaborates with researchers and entrepreneurs throughout all areas of expertise and field. It is more focused on academia and government.
Integrity Outdoor Brands Integrity Outdoor Brands accepts ideas and patented products from inventors through a submission form on its website.
Intuit Collaboratory Integrity Outdoor Brands accepts ideas and patented products from inventors through a submission form on its websi
Johnson & Johnson Consumer Products Can your idea make a difference? “We must experiment with new ideas.” – Robert W. Johnson, 1943, Johnson & Johnson Credo
Jokari Jokari accepts ideas from housewares inventors on its website. The Texas-based company is always working with new ideas and products.
KCI KCI, a medical device company allows inventors to share their ideas on the company’s website. The company is looking for product ideas that can lead to improved patient care and quality of life.
Kellogs At Kellogg, we’re always trying to look for ways to brighten your future, from better-for-you ingredients to labels that encourage a healthier tomorrow.
Kraft Valuable solutions can come from anywhere and Kraft invites you to Innovate with Kraft.
Lego Cuusoo This is a part of Lego’s recent push for innovation strategies and represents another great external touchpoint for the organization aimed at their consumers and users.
LG Collaborated & Innovate LG has posted its technology needs and broad interest themes on this site. LG invites innovators to post their offers and become an LG external partner.
Lisle Corporation Idea Program If you have an original tool idea for the automotive service industry which others may need, Lisle Corporation is interested in evaluating your idea.
Local Motors One of the first open-source communities for car designers and fabricators.
Lockheed Martin Corporate Innovation Web Site.
Maddak Maddak accepts ideas for inventions through the Inventor’s Corner section of its website.
Michigan Center for Integrative Research in Critical Care Do you have an idea to advance the science of Critical Care? Whether you are a seasoned clinician, an undergraduate or graduate student, or a new or experienced entrepreneur we want to hear from you. We are looking for partnerships.
MeadWestvaco A standard Open Innovation website, but there is some aggressive thinking behind the site. Look for great changes that help you engage with the company in new ways.
Medtronic Many medtech companies seem to have the potential for open innovation, but most don’t have the priority. This is a great example, but there is certainly room for feedback.
Newell Rubbermaid Newell Rubbermaid accepts patented ideas from inventors on its corporate website.
Nokia As a part of their sweeping new initiatives, Nokia has also reached out to consumers with IdeaProject. It remains to be seen whether or not the organization can survive against its stiff competition.
Northrop Grumman Innovation Network The Northrop Grumman Innovation Network encourages the most innovative academics and other organizations and individuals to work with Northrop Grumman in the development of the next-generation of these critical programs.
Novant Health Innovation Novant Health Innovation is the place where innovators can work together to solve everyday healthcare dilemmas and improve patient care. Submit your ideas through this one, easy-to-use portal.
Pfizer Investigator Initiated Research A global program is open to all researchers who are interested in conducting their own research. Invites research ideas and offers funding for research projects that advance medical and scientific knowledge about Pfizer’s therapies and generates promising medical interventions.
Philips Sense and Simplicity Philips uses crowdsourcing and social media techniques to create new technical solutions.
Procter & Gamble P&G has initiated their Connect + Develop concept that invites people to submit their innovative ideas.
Psion This was a powerful start, but with the Motorola takeover, we will see how their open innovative initiatives proceed. Something to watch in the future!
SAP This international organization’s efforts have always been very strong in open innovation initiatives. They have thriving user communities and many best-in-class technologies and platforms.
SCA Open Innovation Portal SCA is interested in collaboration with external partners with inventions that can ultimately create innovations and more value for our customers, consumers and business.
Scotts Miracle Gro Innovations If you have a new and unique idea that fits within our categories of lawn, garden, and outdoor living products and services, we would like the chance to work with you.
Shell The GameChanger program encourages innovation from external sources as well as integration with internal resources.
Stanley Stanley’s Invention and Idea Portal allows people with patents and ideas to submit their work to the company.
Starbucks Tell Starbucks what you want. Post your ideas and comment on other people’s ideas.
Statoil Innovate If you or your company can contribute with ideas that could lead to real world solutions for Statoil, we have the competence, financial instruments and the capacity to make it happen – welcome to StatOil Innovate.
Syngenta Thoughtseeders Germinating alliances for tomorrow’s innovations.
Tate and Lyle Open Innovation If you have a new product or technology in the areas of specialty food ingredients; texturants, sweeteners and health and wellness ingredients – or a new food technology altogether – we would love to hear from you.
Transport for London Technology Innovation Portal This portal allows users to submit innovative technological ideas and solutions that meet our key challenges.
Unilever Unilever welcomes business opportunities, technologies and third party proposals for products complimentary to their product line.
United States Postal Service Invites ideas on ways to improve their products and services – New products and services, cutting-edge technologies, innovative approaches.
WMS Do you have the next patent pending, patented game, or technology innovation that can help create the world’s most compelling gaming experiences? If so, your innovation may be of interest to WMS.