Turning an Invention Idea into Money

Lesson Eleven: How Do I Raise Money?

Hands by piles of coins, close-up
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Introduction - About These Lessons

No Money

I'll be honest. If you have absolutely no money and you want to get your invention into the marketplace, it is very unlikely that you will be able to turn your invention into a commercial product. By no money, we mean someone who is unable to earn money above living expenses, raise money or borrow from someone else. However, if you are willing to work there are opportunities out there.

Business Means Business

The most fundamental piece of advice I would give a newbie trying to raise money for his or her invention is this: conduct yourself in an appropriate businesslike manner. An e-mail inquiry asking for financial support penned in an informal manner and full of grammar and with spelling errors will likely get no response. The same goes for badly penned snail mail and muffled or hasty sounding phone calls.

Invention Funding

Below are several resources outlining different ways to gain invention funding to borrow or raise the funds needed to bring your invention through the several stages of the invention process and finally to the marketplace.

I would also suggest that you join a local inventors group to learn from those in your area who have already accomplished what you're hoping to accomplish. That is raise money, find backers, or get a patent etc.

Find Grants, Loans, & Government Programs

Many branches of the government give grants and loans to fund research and the development of inventions.

However, the grants are often very specific as to what type of funding is given. For example, the U.S. Department of Energy offers grants for the development of inventions that benefit the environment or can save energy. The U.S. Department of Small Business offers small business loans. Getting a grants or loan will require footwork and research on your part.

Find an Investor - Venture Capital

Venture capital or VC is funding invested, or available for investment, in an enterprise such as bringing an invention that can be profitable (along with the possibility of loss) to an investor to the marketplace.

Traditionally, venture capital is part of the second or third stage of financing for a business startup, which starts with the entrepreneur (inventor) putting their own available funding into a shoestring operation.

Next, an angel investor may be convinced to contribute funding. Generally an angel investor is someone with spare funds and has some personal (family) or industry-related interest. Angel investors are sometimes said to invest emotional money, while venture capitalists are said to invest logical money. That means they are willing to help give the new enterprise a more solid footing.

Did you get your business plan together yet? Either way, your potential investor will want to see it.

Become an Entrepreneur

It is quite an undertaking to manufacture, market, advertise and distribute your own invention or intellectual property. Ask yourself, "Do you have the spirit necessary to become an entrepreneur?" If the answer is yes, this resource helps you self-educate yourself in the art of becoming a successful entrepreneur.

Canadian Inventors

This list can help those researching Canadian invention funding, research money, grants, awards, venture capital, support groups and Canadian government patent offices.

Student Programs

There are contests out there where students can win prizes or a scholarship. Student invention competitions includes college and pre-college programs.

Continue > Appendix & Additional Resources