How Inventors Can Avoid Being Scammed

I just got done with a one -on -one consultation with one of our members, which was wonderful However, it was also really upsetting to me at the same time and I just felt compelled to quickly put up a video to hopefully stop the madness of what upset me and It upset me partially because this is not the first time I've heard this heard this from several of our members And I'm just wondering how many have experienced the same thing or are getting ready to experience the same thing unknowingly. And so that is having to do with the invention promotion companies that are out there--the bad guys.

 

And I'm sure there are good ones, but there are enough bad ones that are taking advantage of people in such a big way that I just couldn't live with myself if I didn't at least post a video to make it known that that's what's happening and to give you-- you guys some tips so that hopefully if you follow these, you can avoid making a costly mistake yourself. So if you are an inventor that has been taken by one of these companies that has promised you the world, they're gonna develop your product, they're gonna evaluate it, they're gonna patent it, they're gonna get it in front of manufacturers and licensees and all you have to do is pay thousands of dollars. I'm so sorry if that has happened to you.

And my only hope is that by talking about this and by you guys talking about your stories, we can stop them in their tracks and stop it from happening to anybody else.
So if you know somebody who this has happened to or that you're concerned this might happen to because maybe they're interviewing companies like these or maybe you have a friend or a family member who has an invention idea and they're starting to explore that world. I hope that you share this with them. I hope that we just can spread the word about what's happening 'cause it's really awful. And the fact of the matter is it's so awful that there is now a law in place to protect us inventors and it's under the American Inventors Protection Act of 1999.

And I just don't know how many people are aware of it. So I want to spell it out for you so you know exactly what your protections are and what your rights are when it comes to these companies that are so enticing to all of us.

I know I was almost enticed myself multiple times when I first started out and fortunately I ended up not taking the bait. But I completely understand how so many people do because it is very enticing. And these are companies that you meet with and they want to hear about your product and you tell them about it and they want to see some sketches and hear all about the features and benefits and they get so excited about it and tell you how wonderful it is. They offer to do maybe a preliminary valuation, a market research study for you. They might charge you a few hundred dollars to do that and when the results come back nine times out of ten if not nine point nine nine times out of ten. the results are phenomenal. And there is so much potential for this product and you could be one of those 5 % that makes a ton of money on your invention.

 

And so to move to the next step, we need to do a real deep dive evaluation on your project and that is going to cost X amounts of thousands to start that. And maybe it's just do some drawings, preliminary drawings, and then maybe they tell you about all of these. these manufacturing contacts that they have that might be interested in licensing your product right out of the gate, or maybe they promise you that they're gonna get your product in front of a bunch of licensees that are shoe ends for your product.
Whatever the case may be, they make promises that are unfounded and not realistic when you think of how few inventors actually make money. on their products,
how can their claims possibly be realistic? So, fortunately, there, as I said, there are some safeguards in place for us now. There haven't always been, but there are now. And that's what this video is about, is me wanting to share those with you. These are companies, and I hesitated to do this video because I just don't want you to think that every company out there is like this. But there's enough of them that you need to be aware and if you just know what your rights are then you can avoid these costly mistakes. So under the American Adventure Protection Act of 1999 there are certain things that the companies are required to disclose about the last five years of them doing business and so not only that...
that, but in addition, they need to tell you about any invention related companies that they have been associated with in the past 10 years. So I would encourage you right off the bat,
no matter what, to this is you're getting ready to enter a contract that's going to end up being a big number in terms of how much money you're going to spend with this company.

So you should absolutely be doing your research. research. And so what I mean by that is the name of the company, the name of the principles of the company, any company that they've been associated with in the past 10 years, you should go on to the USPTO website, to the Better Business Bureau website, and to the Consumer Protection Agency and do your research and find out if there have been any complaints about any of those companies or the people involved...that's just for starters.

 

And then I just wanna get this right, I wanna give you the exact details. So what they are required to disclose to you before they enter a contract with you are the following.

Number one, how many inventions have they evaluated? What is that number? They must tell you that. Number two, how many of those inventions have gotten positive and /or negative reviews? This is super important because I think the premise of that particular one is the fact that most of these companies will tell almost everybody that what they've created is the second coming and they're gonna make millions of dollars on it.

So we wanna know how many have they said, this is an integral product, we're not gonna take it on, versus how many they've said yes to. And if they've said yes to it. big number then that's a huge red flag because we know that if they really are professionals they know that not that many products are going to have the success that they're promising.

The next one is the total number of people, customers that they've had over the past five years and then how many of those customers have received a net profit on their invention that resulted from the promoter's service. So many times, these promotion companies will take somebody's success story and promote it even though their success really had nothing to do with their company. So to the average Joe, when they're seeing that, they're thinking, oh, this person made all this money because of this company when that's really not the case. So that's super important.

And then finally, how many of those customers have licensed their inventions to a licensee because of the promoter's services, directly as a result of the service that the promoter provided. And typically that number is very small. So they are required to give you all of that information. And if you're uncomfortable in asking for that information, you can just pull up the act with the promoter's services and all of those things spelled out and say, "Everyone's telling me to ask you for this information, so I feel like I really need to before I sign the contract," and ask them point blank to give you the answers to that. And if there is any hesitation, you should run. Don't walk away from that company. The other thing I want to tell you, just kind of some add -on tips,
is that if any company is asking you for thousands of dollars for a big sum of money up front That is the biggest red flag because most of these companies the reputable companies out there They might need to get a little bit of a retainer up front a small number But they know that they make money when you make money The good ones will only take on products that they truly believe believe are going to be successful because that's how they're going to make their money. So if someone is saying we need $5 ,000 or $10 ,000 or $20 ,000 from you to do XYZ services, that's a no -go. It should be a royalty type relationship that they get a chunk of whatever you make on your your invention and that's how that typically works when it's a reputable company.

The other thing, the other tip I want to say is when before you get involved with somebody like this you want to ask them what is the total cost of your services going to be?
Because the strategy that almost all of them use is a drip strategy. That's what I call it, a drip strategy, where the just slowly drip things to you. And before you know it,
you have spent so much money with this company. It starts off with maybe just $1,000. Oh, but then now we need $1 ,500 to do drawings. Oh, we're going to file the provisional patent. Now we need $5 ,000. These numbers, number one, they never make sense for the services being provided. But number two, these numbers should have all been done. disclosed up front to you. You just need to ask. And if they can't tell you what that total number is going to be, if they hesitate at all, again, run, don't walk. I cannot stress that enough because that's what I've seen over and over is they have a way of just slowly enticing you,
bringing you in. And by the time you realize that you're in so deep and you've spent so so much money that you end up spending more because you're thinking maybe if I maybe with this next step that's when it's all going to happen and at the end of the day the number of inventors I have talked to who have lost 10 20 $30 ,000 with these companies is crazy and it makes me so angry as you can tell so find out what that number is upfront and as I said earlier on just do your research, reach out to the USPTO, reach out to the Better Beings Bureau, find out if there have been complaints and if you have a complaint,
if this has happened to you, you should absolutely reach out to the USPTO and they will publish that on their website and then they give the company an opportunity to respond to that so that will be up on the website.

So you can go there and find out which companies have had complaints. complaints. The problem is, unfortunately, a lot of these companies, what they do is they end up going bankrupt or closing their doors,
so to speak, and then they reopen under a different name. And so it's sometimes hard to discover which are good and which are bad. But that's why when you ask those hard questions, you should be able to get a sense right away for if they're reputable or not. The other thing is ask for references. Ask to speak to numerous, I mean, I would say at least five customers that they've had that they've done business with. Some of them will have shills, so to speak, fake customers. So that's why I asked for a number of them and actually talked to them and find out what kind of a relationship was it? Were they happy, were they not? So that's why I asked for a number of them. is my soapbox post for the day. I just really want to put a stop to this and it's so upsetting to me to see people spending so much money in mortgaging houses and borrowing from friends and family to give to these dishonest, unethical companies that are out there and I don't want it to happen to you.

 

I would love for you to take the time to post your story down below if it did happen to you because I think by us getting verbal about it that's how we're gonna put a stop to it and as I said way earlier on if you know of somebody that you're concerned may end up you know falling prey to this please please please share this post with them and I would just say share it with as many people as you can because we need to get this information out there we cannot allow this to happen again.

 

Anyway, I hope you guys all have a wonderful rest of your day or evening whenever you see this and thank you for watching.