NEWSLETTER NUMBER 7

Title:  "What's Your Advice If I Have A Great Idea, But No Money?"

 

Question:  I have absolutely no money.  How can I get my invention into the marketplace?

Answer:  If this is true and you have absolutely no money and can't raise or borrow any money, the likelihood is that your invention will not get to market and become a commercial product.

Question:  Why is that?  Isn't this America, the land of opportunity?

Answer:  Yes, it is and you have the opportunity to succeed or fail with your invention.  But unless you can raise some money and be prepared to do much, if not all, of the work yourself, your project is doomed.

Question:  Why so?

Answer:  For starters, you will have to pay the telephone company for your calls, the post office for your postage, the stationary store for stationary and envelopes, the printer for brochures or catalogue pages and the electric company for power.

You will need a location from which to work and phone equipment, an answering machine, probably a fax machine, perhaps a computer, some furniture and time, lots and lots of time.

You'll notice that we have yet to mention the expense of patent searches, patent filings, legal advice, marketing and business management advice, travel expenditures, trade shows, an entertainment budget, prototypes, samples, shipping, engineering help, etc.

You see, if you don't arrange, in advance to have the money available to pay for the things you cannot do yourself, how will they get done?  How will your project move forward?

An inventor recently quipped that since God gave him this idea, God will provide the means to accomplish it.  Well, perhaps.  Miracles probably do happen.  But should depending on a miracle be the basis for your business plan, the critical element in the success of your project?  Or should you realistically approach the financial challenges you will face and develop a solid plan to see your project through to its logical conclusion.

Question:  How can I raise the money I'll need?

Answer:  First, determine how much you'll need.  What portions of the project can you do yourself?  What talents/functions will you have to hire from outside?

Next examine your resources, sources of cash: bank accounts, assets you can sell, equity in a home you can borrow against, life insurance loans, 401K and IRA loans/withdrawals, friends, relatives, etc.  Other than friends and family, who do you know that might consider backing your venture financially for an equity stake?   Consider as sources: successful business people in the community, prominent families, business incubators, small business loan programs, venture capitalists, even potential competitors.  Sometimes, especially if your invention is compelling enough, they may consider joining you rather then competing with you.  Be certain to have non-disclosure agreements signed before divulging the substance of your invention.

Question:  This seems like an awful lot to go through.  Will it be worthwhile?

Answer:  If you have to ask this question, the answer is probably "no".  And there is much more to do and consider than we have even touched on.

If you want to approach this whole process of inventing and capitalizing on an invention, the best advice is to educate yourself by joining a local inventors group and learning from those who have come before.  There is a good list of inventor groups in every issue of "Inventor's Digest" magazine which is a very informative publication dealing with all sorts of inventor challenges.  For "Inventor's Digest" subscription information contact them at (617) 367-4540 or email: InventorsD@aol.com.  Their website is www.inventorsdigest.com.  

If there are questions you would like to have answered in future newsletters, please submit them to harold@solve-itmarketing.com and we will do our best to include them.

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