How to Sell a New Product Idea
Updated: Mar 9, 2022
If only I had a dollar for every person that ever asked me about selling an idea. An idea is just a thought, maybe a well-developed thought, but still just a thought. It has no intrinsic value and cannot be 'sold' as such. It cannot be patented or protected until it is developed into something tangible that can be valued and sold like any other asset. The person buying it must feel that they have bought something of value that can be used to generate income or revenue for them - just like any other fixed or tangible asset. Intellectual property or IP (utility patents, trademarks, copyright, design patents, design registrations, etc.,) are all assets that a person or company owns and that have the potential to generate value or revenue. That is why they sit on the assets column of the balance sheet.
For many aspiring inventors, the development of a new product idea through prolonged thought, hand sketches and crude cardboard models is an exciting and energizing process which often leads them to believe that they have arrived at a breakthrough moment and have something truly worthwhile and valuable to offer the world. Unfortunately, this is where many people come to the realization that all they have is an idea which, of itself, is fairly worthless. After the concept or idea has been formed, the jobs of detailed engineering design, material selection, manufacturability, IP protection, prototyping, and consumer testing all need to be completed before one can say that they have a product that works, can be manufactured at the right cost and for which there is adequate demand in the market at the right price point. Only then, will investors, distributors and retailers show serious interest in both the product and the inventor. Only then can you really say that you have something of value to sell that has the potential to drive revenue and make money.
In general, if five people say yes and only one says no, the group will reject a new product investment. You only have to watch a few episodes of Dragon's Den to see that investors want as much return for as little risk as possible. The projects that get the investment are nearly always the ones that have already developed, produced and proven the product in the market and are looking to expand into new markets. The projects that get rejected out of hand are the ones that are still at concept stage and have only done preliminary market testing, if any. In order to sell your new product idea you have to be able to demonstrate that it works, it solves a widespread problem, it can be manufactured at a known cost, it can be sold for a known price and that your target market really wants the product and will buy it. To get to this stage will take time and money. If you don't have the money yourself then you will have to depend on friends, family, bank loans, savings, state support or whatever to get you there as, in general, investors do not invest in product ideas that are not ready for market and have not already been proven in the market. If you really believe in the idea and are prepared to put your money where your mouth is then good luck. If you are not prepared to invest your own savings or to take a loan to get your product developed, it is highly unlikely anyone else will want to invest in you or your product.