Avoiding ‘Black Holes’ And Other Mistakes When It Comes To IP Licensing

Licensing your intellectual property (IP) can help you grow your business without building every product, entering every market or hiring every team yourself. From software and branded merchandise to content, designs and data, a licensing deal can turn existing IP assets into new revenue streams.

But licensing is not simply “passive income” backed by paperwork. A poorly structured deal can restrict future opportunities, weaken your commercial or legal position and cause problems when things go wrong.

The aim is to monetise your IP without giving away the farm. Here are some common mistakes to avoid.

1. Giving away exclusivity too easily

Exclusivity can be attractive to a potential licensee, but it comes at a cost to your business. Depending on its terms, an exclusive licence could prevent you from working with other partners or exploiting the IP yourself within a particular market.