Valuing Inventions
It’s one thing to have a patentable invention, but it’s quite another to have a valuable invention. Before seeking a patent, or if you already own a patent, before selling or licensing the rights, it is important to ascertain its monetary value. That way, you will be able to make better decisions regarding whether or not to invest in a patent. Additionally, knowing how much your invention is worth enables you to negotiate more effectively with potential buyers. Practitioners use the following factors to assess the value of a patent.
Is there a market? First determine if anyone would be willing to purchase your invention. To do this, identify whether or not consumers actually need the product. You might accomplish this through personal experience, if the idea for your invention was born out of necessity, for example. This is usually only effective if the situation giving rise to such necessity is common to other people. If a market exists, determine its size. For example, try to figure out if the invention would serve a specialized niche of consumers or a broad base.
Are there comparable products? Another factor is to identify any comparable products already on the market. What are the other products’ price points, and does your invention offer something new? For example, your invention may solve a problem in a specific area in which other similar products already exist. Highly valued products are those offering significantly more benefits than the competition.
