Tuesday 21 July 2009 5:10:17 pm

I believe that licensing is very important, it has the same power as franchising . I further believe that inventors and companies ignore this at their peril.
If you are old enough to remember the Betmax/VHS wars of the 80's, you will understand my point.

The Sony Betamax video recording system was the superior technology by a considerable margin.. But who knows? arrogance , Hubris, what ever, prevented them from licensing their product to other interested parties. The interested parties got together, and developed their own format. The rest is history VHS killed Betamax.

Had Soney adopted a different approach and offered to licence their superior technology to other companies. They could have retained their top gun slot , but also had a string of nice little earners, comming in at regular intervals.

This 100% of nothing rather than 10% of millions is often what destroys inventors !
Inventors often put over-inflated values on their inventions. This simply leads to stagnation.

The average value for a technical licence is between £11,000 at the low end, and £120,000 at the top end. ( Info source : Growth company analysis of venture capital companies in UK.) This is not sufficient capital to retire to the Carribean for the rest of the inventors life.

In order for an inventor to prosper, he must cross back over the reality barrier, and produce, a series of licences, or beter still a series of new inventions, creating an intelectual property pool, from which a stream of licences will flow!

This is paramount if the inventor is to metamorphose into an entrepreneur !

http://nwdavison.magix.net/website

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Wednesday 22 July 2009 1:26:30 pm

A comment on this discussion - licencing can be useful and important, but it's just part of the wider issue of Barriers To Entry. This is basically anything which you have that it's difficult for someone else to copy, and it is a much wider discussion.

Licences, copyright, patents and Intellectual Property in general are vital for inventors. However not all entrepreneurs are inventors in the classical sense, and not all inventors are entrepreneurs. As long as your idea is pretty unique AND you provide a sufficient barrier to entry to other would-be entrants (and this maybe a bunch of things, from alliances with key partners to geographical or "clustering" advantages, to high capital requirement) you can make your business work. Patents are good, and can add value, but they're not essential in all cases. Look at some amazing entrepreneurial success stories such as Zara or Easyjet: they had very little IP, but unique business models with some barriers to entry.

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Wednesday 22 July 2009 2:47:09 pm

Kathryn - you're right: The Good Entrepreneur isn't just about inventions and clean tech. As long as you can show that it has an environmental benefit your idea is valid for the competition.

We're really pleased with the variety of entries we're getting so far - in fact you should check back on the entries pool page:

http://www.goodentrepreneur.com/The-Competition/Entries-Pool

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