Are you looking for a way to radically improve your products or expand your product lines with something cutting edge? Think about licensing someone else’s intellectual property. You would be surprised how much it can reduce your initial investment and risk, creating a win-win proposition for everyone involved.
Just last week I was on a panel at SUNY Polytechnic in Utica, NY as part of their “Made in the Mohawk Valley” Manufacturing Day event. The region has a fair number of small manufacturers and I was asked to speak on the topic of innovation and the role of intellectual property. The event included some of our local food & beverage manufacturers, like Matt Brewing Company and Chobani, so I felt right at home. Being the “can-do” kind of guy that I am, I decided to focus on one of the great opportunities created by intellectual property, the ability to license new technology or know-how that someone else has developed to kick start your own innovative products or services.
- Innovate or Die. Markets are constantly changing and manufacturers are forced to compete on a worldwide stage. Competing solely on cost is a fool’s errand, so innovation is the only option. Even if you produce a commodity product or service, innovation in operations, marketing & sales channels, and delivery can make all the difference.
- You Weren’t Built for It… Very few small-to-mid-sized manufacturers have world-class R&D capabilities in-house. But world-class innovation is what you need and if you can’t build it, you are going to have to find it outside your organization. Even large organizations benefit from looking outside their own labs when it comes to radical innovation.
- …But You Will Be. In-licensing technology is a stepping stone. It is a way to use your existing manufacturing capability and product engineering know-how to build your ability to bring radical new technologies to market. Once you have that ability, you can continue to bring in outside technologies, but also start developing your own.
- In-Licensing is a Seed. When you bring in a patented technology, the initial patents are just the seed. This is especially true when licensing technologies from universities and government labs. But even if you license from another company, there will be product engineering, improvements, and complementary technologies that you can use to build your own patent portfolio and know-how.
- Focus on What You Know. There are markets and customers that you already know. Your goal is to shop for potential technical solutions to customer problems you are familiar with. It is your advantage over academic researchers, startups, and technology companies in different industries and markets.
- You Know How to Iterate. You can apply what you know about process improvement to creating your new products and opportunities. Once you find a candidate technology for in-licensing, structure everything for rapid prototyping, real-world feedback, and data-driven decision-making. Don’t overcommit to the first opportunity. Successful innovation is about being nimble. (Keep this in mind when negotiating licensing terms.)
- Bargains Abound. Unused (or underused) technology is sitting on the shelves in most universities, government labs, and companies large and small. With a glut of technologies looking for markets and companies to commercialize them, you don’t need to pay a lot up front to get your hands on them. Technology transfer offices have gotten wise and most look simply to defray or recoup initial patent costs on the front end and are willing to leave the real payment until after the product is successful.
If you are ready to get started, look to what and who you already know and branch out from there. Start with your industry. Attend conferences and meetings. Check out technical journals and industry publications in areas of interest. Who are the technologists who are writing papers, patents, and presentations? Look for university and government lab affiliations and reach out to them to learn more.
Next, look at the colleges and research institutions in your area. Go talk to them. What do they work on? Are there any faculty or students interested in what you are interested in? They may already have something, be working on it, or be willing to steer their research towards your needs. If nothing else, they may know who else has been working in the space and give your more places to look.
Most importantly, talk to your customers about what they need. With that in hand, it is relatively easy to look for people who are working on it.
There are also ways to mine patent data to look for unused technologies and identify researchers, institutions, and companies working on the customer problems and technologies you are interested in. But that is beyond the scope of this post. Contact us if you would like to learn more.