Inventors can make money from their inventions in two ways:
- by licensing the invention (selling the right to commercially use or develop the invention to someone else), or
- by marketing and manufacturing the invention themselves. These different options will affect not only how you earn money, but also how much financing you need to proceed.
Whether you choose to license your invention or market and manufacture your invention yourself often depends on your personality and what you like to do best.
If you are a typical inventor, you will probably want to license your invention and collect royalties, or even sell it outright.
If you are more motivated and have a competitive business streak, you may wish to start a small business to produce your invention and market it. In that case, you will need substantially more financing to develop, produce, and distribute your product.
To some extent, your decision is influenced by your invention. Certain innovations, because of their complexity, scope, or exorbitant cost of production, may lend themselves to licensing. Often, however, the decision should be based more on you than on your invention. You must objectively examine your inventing personality.