Be aware of the differences in licensing terminology. “When looking for a [licensing consultant], be aware that terminology is critical, stress [licensing specialist Cheryl Stoebenau] and [marketing and licensing consultant Gary Caplan]. A licensing agent represents the property being licensed, a licensing consultant represents the manufacturer seeking the license, and a marketing company is not necessarily a licensing expert, although many include licensing as part of their services. Most licensing consultants work by contract and on retainer, says Caplan, although arrangements can also include a retainer plus percentage of sales agreements or per-project arrangements. To find a licensing consultant, contact LIMA, check licensing resource directories or attend licensing shows.” (Cynthia E. Griffin, “License to profit: make your play for a piece of the $100 billion licensing market,” Entrepreneur, January 1, 1997) Find other authoritative sources of information on invention licensing agents and licensing agent fees.
Invention licensing remuneration is typically based on the percent of royalties generated. “[Invention backers, venture capitalists, and licensing agents] will sponsor or represent you [the inventor] in one way or another because they believe in your idea. Their remuneration is a percentage of whatever royalties your idea generates, and if it’s not successfully licensed or marketed, they get nothing. Invention marketing companies on the other hand, earn their money from the fees you pay them for their ‘services’ rendered.” (Harvey Reese, How to License Your Million Dollar Idea, Second Edition, John Wiley & Sons, Inc., New York, 2002, p. 76) Listen to Harvey Reese Tells You How It's Done.