I recently assisted a client who was quite stressed when she first approached me, having been entangled in the complicated processes, promises, and contracts of an invention promotion company. Like most customers of these promo companies, my client was a smart, but busy and inexperienced inventor who lived in a rural area; not exactly the meet-your-angel-investor-at-the-local-Diary-Queen kind of place. I imagine she googled questions like “what do I do with my new invention?” and “how do I get a patent?” before linking up with this particular promo company, probably through an online ad.
After a lengthy list of promises from the company of making her money, minimizing her risk, and LIMITED TIME ONLY deals, my client was persuaded to elect a paid package inclusive of a provisional patent filing, audio/video files, and other supposedly awesome stuff that could probably be obtained for free from a local small business development center. Buried within her service agreement, and responsive to public disclosure laws, were data points concatenated by endless disclaimers effectively stating that the company over its long, profitable history has had less than a 1% success rate of closing net positive deals for its customers. Now, which sounds better: “we sign a license agreement on behalf of an inventor every two weeks!”, which sounds promising and is a common claim; or, “we earn less than 1% of all our customers cold, hard cash, while we rake in millions!”?
Let me hammer this home with some random, comparable probabilities:
1) Probability of getting cancer: 50% men, 33% women.
2) Probability of living to 100 if born this year: 33%
3) Probability of being victim of a serious crime: 2%.
4) Probability of an adult male being afraid of spiders: 1.2%
5) Probability of being audited by the IRS: 1%.
6) Probability of realizing a net profit from the activities of a promo company: 0.95%.
7) Probability of dying in a car accident: 0.88%.
8) Probability of dying from firearm assault: 0.27%.
The rodeo is on, and unless you’re careful, you may be taken for a ride by one of these companies. Their marketing tactics are quite impressive, much better than mine, though it’s hard to fairly compare since I try to avoid claims of riches while burying data that might belie such claims. Unfortunately, they are more or less unregulated by the PTO. In this case, awareness is your best defense to personal exploitation.