Sell the idea or Sell the product? That is the question!

by Roy Paul Prosise on November 5th, 2015

With limited time, energy and capital to develop a new product idea or invention, you have to make a decision on your plan of action and exit strategy.
 
Do you want to secure the intellectual property (IP) rights to sell your idea or build a company to sell the product?
 
You would most likely need to do the former to have a lasting success in the latter, but making this decision early in the early stages of product ideation will assist you with properly allocating your efforts. Eitherway, both end goals require tools and both require work; however the specific tools required for each path can be optimized! It is very important that you balance your investment put into securing your IP with the overall budget you have for product development, product validation, marketing and sales efforts. Sometimes it is not worth spending too much on the IP as there is already a saturation of existing products, technology and IP in the marketplace. In this case it is probably better to focus your finances and energy on development of a better product than competitors, sales tools and marketing campaigns.
 
Here are a few key questions to ask yourself in the early stage of product ideation to decide the best strategy to take to reap the maximum output.
 
1. Do you have the adequate budget of time, energy and capital to build a company around a product idea? Product development costs can range from $250K to $5M. 
2. What is the product life on the market? Some products have very high level of success for 1-3 years and sales plummet as soon as competition saturate the market. 
3. How well can you secure the IP? Is it easy to knock off? Is there already similar patents that have been filed? Patent filing can get very expensive, very quick.


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