This little inventor went to market - marketing inventions

Nation's Business, Sept, 1995 by Marsha Bertrand

In 1989, Joan Gordon read about how birds and small mammals die when they get trapped in the plastic rings from six-packs of soda and beer. Being an animal lover, she started looking for a solution. She experimented with various materials and came up with a ring that breaks when a can or a bottle is pulled from it. That was the birth of the Freedom Ring. Although coming up with the idea was relatively easy, Gordon found that marketing it was an even bigger challenge.

Gene Cox of Richmond, Va., had a similar experience. He invented the Thumbnail, a machine that enables picture framers to rout out and connect frame corners quickly and easily. But while Cox loved the thrill of inventing, he had no interest in the marketing end of the business. "I can invent things, but I'm not a good organizer to take it to market," he says. "I'm a nuts-and-bolts guy."

Luckily, Cox found Ron Morgan, a product developer in Bellingham, Wash. Working together, they refined the prototype of the Thumbnail to make sure it was a workable product that solved a problem common to picture framers.

After they had the product, they decided to try to market it before they applied for a patent.

"People spend thousands of dollars applying for a patent, only to find out there's no market for their product or that it's too expensive to manufacture and market," says Cox. "Marketing is a much more difficult obstacle to overcome than getting a patent."

Although it may be too early to apply for your own patent, it's not too early to have a patent agent or patent attorney conduct a search to see if someone else already has a patent on your creation. A search is less costly and less time-consuming than an application. The names of patent agents and attorneys can be found in the phone book, in a registry that the U.S. Patent and Trademark Office publishes, by referral from a local bar association, or by referral from other inventors.

If a patent search discloses that someone took out a patent on your product but never produced it, it can be risky to develop your product. "The other person could sit back and watch you manufacture and market the product and make a lot of money, then file papers and take away what you earned because they had the patent on the product," says Cox.

It also can be risky to enlist the services of a company that offers to take your invention to market provided you pay in advance. "Anyone looking for money upfront in marketing an invention is a problem," says Don Moyer, a patent agent in Chicago who also offers free workshops for budding inventors.

Once you have determined that no one holds a patent for your product, it's time to get to work. The law says an inventor can sell a product for up to a year and still file for domestic patent protection. That gives the inventor a full year to test the product's market appeal before spending money on a patent.

If you don't have a patent, though, what are the chances of someone stealing your product? It's difficult to steal an unpatented product, but it happens.

Nonetheless, you can build your own safeguards. "Keep good records," says Moyer. "Make sure you can prove you are the inventor, and keep a log of the dates you worked on developing the product. Before you have a patent, the risk is the highest, so it's important to keep records that will stand up to close scrutiny."

To determine if the product will sell, of course, you have to manufacture it, and that can take a lot of money. Many banks are reluctant to finance start-ups on the ground that they are too speculative. So what about venture capitalists? That's what Michael Feygin tried.

Feygin invented the Laminated Object Manufacturing System, a rapid prototyping technology. Through the use of a computer and a laser beam, a two-dimensional computer drawing of an object can be transformed into a three-dimensional object. When Feygin approached venture capitalists with his idea, they told him he wouldn't be credible until he had a patent. After he obtained the patent, the venture capitalists wanted to see a working prototype. He built one. Then they wanted him to sell a couple of machines before they'd back him. He sold two. Then they wanted to wait and see how the market developed.

Luckily for Feygin, he managed to obtain government grants to support his research, but during one period he even resorted to unemployment assistance so he could continue his work. He now owns a $10 million company that sells his invention. "Recently I talked to the venture-capitalist group," he says. "They're ready to take a minority interest. But I don't need them or want them at this point."

So if the banks and the venture capitalists aren't interested, where do you turn? You have to finance development and marketing yourself. Ron Morgan mortgaged his house and borrowed money from friends to finance the Thumbnail. Of course, you can raise only so much money yourself, so it's important to start small.

"The trick is to find someone who can help you figure out a process where you can make short runs of a salable product," says Moyer. "You don't want to have to spend $40,000 or $50,000 for molds, only to find out the product won't sell. Instead of a large injection-molding company, find a small machine shop that can help you out." You may find a machine shop willing to do the work for a share of future profits rather than conventional payment.