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This Invention: A Family Content Network

A journal, information and resources for establishing a Family Content Network, as I am doing - essentially a framework for managing all your Family's online assets and inventions for maximum exposure and revenue. This blog began as an inventor's journal, and retains the overall parent inventor's context and mindset.

Saturday, November 26, 2005

(13) Great advice

In my tireless quest for advice, and tips on avoiding costly mistakes, I ran across this summary in the alt.inventors group (Google). Fantastic stuff, and absolutely right on, imho. This blog won't typically contain references to outside advice, but this particular thread is one I'm very much following, and aspiring to, as ground-roots guidance.

(In answer to a question about what to do next, once you have an 'idea' for an invention' - by Wayne Lundberg.)

"Don't pay a penny to a patent attorney - yet. Disclose your idea with a $10 check to the patent office along with a drawing, sketch or photo of your idea/prototype. Or better yet, apply for a $100 Provisional Application yourself with help from folks in the inventor's newsgroup (alt.inventors). No matter how good you think your idea is today, in months you will have changed it and if you had spent the money on patent attorneys and all that stuff it would be money down the drain and no money left in the pot for that very essential engineering change to make it all work right.

Make sure your product/idea will sell at a price that will leave you a margin. Today's greatest tool is free and is something old time marketing people only a year or so ago could only dream of. Create a long list of keywords that you will be using in your advertising copy. Go to http://www.ebay.com/ and under the special search function click "closed items only" and input your keywords. You will see what the market has paid for items such as yours over the last couple of weeks. Do this every two weeks as you go through your development process. Sony never sell their products based on the old and obsolete MBA based manufacturing cost formulas. They sell them at PERCEIVED value by the consumer, and then they create manufacturing/distribution systems to achieve these targets. With eBay, you are at par with Sony's marketing gurus.
Be first on the market if you really believe your product has a future. Bet everything on marketing and manufacturing. When you think of making a copy what company name comes to mind? Right, Xerox owns the concept and everybody, no matter how good, will be second best in the eye of the consumer. What a tremendous advantage this gives Xerox.

Don't spend money on business incorporations, stock ideas, expensive letterhead, offices and business stuff. Work your checkbook until it's ragged, and then at some time, master Excel, Visual Basic, Access and use it until you hit over $30 million a year in sales. Get others to play in your sandbox by offering them a share in your future company. Do a fictional incorporation, say for a million shares. Set half of them aside forever - they will be used later as collateral at your bank. Sell 25% of your stock for cash. Reserve 25% for yourself and others who will help you build your business. Pay your lawyer, business consultant, accountant, and engineer in fictitious paper stock. Once you explain your business plan they will see the value of this option. Keep 12.5% of the stock for yourself from the get-go. (Keep the voting rights on the 50% for yourself). When you start making money distribute the 50% back into the business in the form of tooling, machines, marketing - whatever will further the business. See chapter 10 in http://home.att.net/~impresario/Index.htm it¡¦s free, no obligation, no come-ons.

Find your nearest Small Business Development Center (Not SBA, and not SCORE) at your nearby college. Have an interview and show them your idea and basic strategy. Their service is free, funded mostly through the SBA and State funding. They will assign people like me to help you through the maze at no cost. You have paid for it through your taxes.

Farm everything out. Do final assembly yourself. Don't buy machinery - others do it much better. Make good drawings, get good quotes, and manage your purchasing.

Get some prototypes into the hands of friends and neighbors and let them tell you what they would be willing to pay for such a device. This is the second step in guerrilla marketing. Be ready for heavy duty criticism and be willing to listen very well. You are in love with your idea, they are luke warm but may be looking for something jazzy.

Don't spend a single Dollar that does not help take you toward your objective. Have a solid objective and put in some measurables. For example if you send out 100 post cards showcasing your product/idea to so many businesses, at a cost of $0.76 each, and you get two queries, but it takes four queries to make a sale, then you know the approximate cost per sale if you repeat the process. This is key to your promotional and advertising budget. Time share marketing is on a strict formula; it takes something like one thousand phone calls to get 500 people to listen, for 5 to attend an event for one to buy a $12,000 unit.

If you go after a loan or venture capital focus on showing them exactly how you are going to spend their money in such a way as to make a positive return on their investment. This is the real heart of a business plan. Everything else is window dressing for which you usually pay a creative writer a fortune --- and it adds nothing of value. The financial spreadsheet showing exactly how you will spend and how you will gain a return from that expenditure is what matters.

Ask people to help you. Don't be afraid of rip-offs, that's why you protected your idea! Put a non disclosure document in front of them to sign. Use this newsgroup to the maximum.

If you don't want to get involved with the manufacturing, perhaps a licensing deal would be best. Contact our friend with the Boomerang fish thing, Rodney, in the newsgroup. He'ss an expert at it.

Distill your business plan, your business objective into a 15 word sound-bite and repeat it endlessly. You will be explaining your whole business to a fellow on the way to the third floor on an elevator. Learn how to get their interest in those few seconds.

Recognize that as the CEO of a new company you have four key responsibilities. Recruiting, Selling, Finance and New Opportunities. Recruiting can be getting a free consultant from the SBDC - Selling could be a write-up by your local paper interested in promoting new talent - Finance could be getting 30 day credit from McMaster Carr or a venture capitalist. New Opportunities come from being observant and asking yourself "What's new" at all times.
Get a copy of Matthew Yubas "Product Idea to Product Success¡¨ http://www.broadword.com;/ Bob DeMatteis' book "From Patent to Profit" and James White's book "Will it Sell" and read them cover to cover. Email George H. Morgan, Marshall Price, John Pederson, Michael F. Brown, Dave Kiewit, David M. Geshwind and others in the inventor's newsgroup. Go to stuff at http://home.att.net/~impresario/Index.htm and learn about cost effective manufacturing, how to invent and how to double your brainpower in one fell swoop - all for free, complete and unabridged. Start by mastering Project Management and go from there. "