To License or not to License: Choices for Savvy Business Owners
So you've got the next big thing in technology sitting in your office: a program you customized for your business or a hardware you came up with on the side. When is the right time to license your product for outside sale? Read further to learn the ins and outs of licensing and why the best decisions for your business can often be contrary to common sense.
There is a fine line between successful licensing and a failed attempt. You certainly don't want to risk selling prematurely, when the software doesn't yet have enough appeal in a large market to succeed. On the other hand, you don't want to "lose" the market altogether by selling the sale rights to someone else who will “overtake” the product.
Questions to Ask Before you Commit to Licensing Anything
Before you make the decision to take your hard-earned product and send it to the masses through licensing, consider:
The value of your new product and its potential
If you believe you have a truly unique software, it may be best to keep it under wraps and exclusive to your company. However, if it is a product in a highly competitive area wherein technology changes quickly, it may be worth thinking about how best to capitalize on the changing market.
Its fit on your business market
If your software is a time management program and you run an internet security firm, there's a chance that you may have to spread yourself thin to market the new product and maintain your own business focus. In this case it might be smart to find a company to license your product that is more aligned with the product's purpose.
The levels of licensing
It is possible to allow a company to license your product on a non-exclusive basis, which will allow you to maintain control of the product in some form. The decision to pursue licensing of a software or hardware should be made carefully.
If you need advice on what to do with a new software or piece of hardware created by your business, give us a call. We can help you maximize the benefits of your design.