Licensing as a Business

About Me Mechanical Engineer Entrepreneur ASU Faculty Consultant Mentor

Eli Chmouni

@elichmouni

About Me Mechanical Engineer Entrepreneur ASU Faculty Consultant Mentor

This workshop What is licensing? Licensing an existing brand Your business as a license Resources Q&A

LICENSING EXISTING BRANDS

YOUR BUSINESS

AS A LICENSE

What is licensing? Licensing is the process of leasing a legally

protected (that is, trademarked or copyrighted) entity – a name, likeness, logo, trademark, graphic design, slogan, signature, character, or a combination of several of these elements. The entity, known as the property or intellectual property, is then used in conjunction with a product. Many major companies and the media consider licensing a significant marketing tool.

Brand Extension Licensing is a marketing and brand extension tool

that is widely used by everyone from major corporations to the smallest of small business. Entertainment, sports and fashion are the areas of licensing that are most readily apparent to consumers, but the business reaches into the worlds of corporate brands, art, publishing, colleges and universities and non-profit groups, to name a few.

Licensing existing brands

Shark Tank example Doing business in a specific category by

using an existing popular brand Obtain the rights to use that brand in a

category through a legal license agreement (discussed later)

Licensing example Product Product with a license Customer recognition Story of the new product

Why license Existing brand recognition Not as much marketing needed Consumer trust Support services

Top licensors Walt Disney Company PVH Merideth Iconix Mattel More…

Key things to know Requires experience and credentials Top focus on quality and sales strategy A legal arrangement (need a lawyer) $$$ upfront Negotiations are key Quality of the license matters

Start a business as a licensee Identify a brand and the owner Identify the product/service you want to

offer Research current deals Create a short 2-3 page proposal Contact licensing branch or broker

How to contact

MUST REVIEW: License Global Great free magazine Contact information of agents online and

in magazine

Discussions with brand managers Ask about existing deals Check for interest in your product/service Ask about (in email #3)

QA standards Marketing standards MRGs Regional restrictions Upfront fees Duration/timeline

Submit a proposal Marketing strategy Sales/distribution strategy Upfront fees Royalty fees Sales projections Guarantees

CONVINCE THEM THAT YOU WILL MAKE LOT OF SALES AND THEY WILL IN RETURN MAKE $$

License Agreement Prepared by the licensor Review with a lawyer It is a legal contract Sign and you are ready to go

Do not personally guarantee a thing Form an LLC for all these relations

Quality Assurance Licensor reviews product samples and

packaging to ensure it meets their standards.

Mass productions

Resources Agencies: http://

www.licensingexpo.com/files/files/Top35Agents15Dec.pdf

Expos: http://www.licensingexpo.com/licensing-expo

License Global

Example #1

Example #2

Become a Licensor You have a super awesome brand and

want to license it out. Licensing could be based on category or

region. What do you have to do?

Become a Licensor MAKE SURE YOU ARE PROTECTED (TM,

patents, copyrights, etc…) Identify the value/worth of your brand Identify what categories you want to be in Get an agent or identify possible

licensees

Become a Licensor It is a lot more difficult to become a

licensor than a licensee You need QA systems, accounting

systems, audit capabilities, legal structure, extended insurance, $$ for marketing, etc…

Example TM the name and brand Develop a culture/experience Show revenue models and profitability Show ease of adoption and growth Create a repeatable system

Example The power of your brand when people

ask for it. (Montreal) Tipsy Midwest expansion

Example Create a licensing system Upfront fees Training and quality assurance Royalty fees Online support system Financial system Marketing strategy Merchandise and designs Broker partnership

Example Tipsy in 16 cities Current negotiations with 4 other cities

Is your brand licensable?

Understand what you have Talk to a license agent Know the difference between a license,

a service and franchise.

THANK YOU Eli Chmouni eli@skyworld.cc @elichmouni (Instagram and Twitter) Eli Chmouni (LinkedIn)