Stephen Key learned the secrets of licensing from Teddy Ruxpin and never looked back. Steven Key loves to sell.
He began hawking goods on New York street corners dreaming of getting his inventions onto store shelves. His career took off because of a teddy bear and now Steven Key is the world’s leading expert on how to license product ideas across multiple industries.
“I thought I wanted to create toys and sell them in stores. But having a great idea is one thing. Getting paid for it is another. I had lots of ideas but I never wanted to run a business and it’s not my strength anyway. Teddy Ruxpin taught me about licensing. With one idea, I could create income that lasted for years.”
Key says that the process of turning an idea into a product “isn’t for the faint of heart, to put it mildly. There are no guarantees.”
But on the other hand, the opportunities are legion.
“Creative people in big companies are watching the clock. They’re not inspired, not doing their best
work. Meanwhile, guys like me are outside, curious and obsessed. I can’t stop thinking about improving ideas. And some industries - toys are one of the best - are always open to ideas. They’re looking for good ideas from people like me.”
Key, who has created and licensed dozens of products and authored One Simple Idea, Sell Your Ideas With or Without a Patent, Become a Professional Inventor, Licensing Ideas using LinkedIn, says most potential inventors never get anywhere because they’re afraid of being ripped off. “They think they need a patent or the big companies will steal their ideas.” But, he says, those people are wrong on both counts.
Watch Stephen Key at METAL
“First, as far as patents go,” Key wryly observes, “don’t worry. You will definitely get copied! But you don’t have the money to fight companies in China. And you wouldn't win anyway. The key today is to go with a big company and get your product out fast. Licensing to a market leader is your best form of protection because it’s about speed today. Own the market before a copycat can knock you out.”
Second, big companies need product so they don’t steal ideas from outside creators. “They need people like me. You look for the companies that welcome open innovation culture. Not tech - tech has a long history of taking ideas from creators. But toy companies for example, they want to keep the ideas coming in so they treat you fairly.”
“I don’t waste time worrying about patenting. I look for simple changes to existing ideas - a point of difference. I don’t expect to license every idea. The royalty rate is about 5% of retail price, maybe 3%. I create. I dream up ideas. It’s a numbers game. In the end? I get enough deals, it works out just fine. And I’ll tell you one thing - it’s a long way from shouting myself hoarse over the noise of taxis on a Manhattan sidewalk.”
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