How to License Your Trademark

Wouldn’t it be nice to receive a monthly check just for allowing someone to use a creative name slogan or logo that you came up with? This is how trademark licensing works and I’m going to show you exactly how to license your trademark in this article.

This is the eight blog in our How to Make Money with Trademarks series. We have previously covered What is a TrademarkHow to Apply for a TrademarkHow to Own a Trademark, and How to Create a Trademark that Makes Money. Now, that you understand how to create a money making trademark as well as how to legally own and protect your trademark, we’re going to learn about how to license your trademark to generate monthly passive income.

What is licensing?

Licensing is the process of giving another person legal permission to use something that you own. Oftentimes, individuals that are creative enough to come up with novel and iconic trademarks do not always have the time, capital or desire to build a business around the brand that they created. Instead, they leverage their creativity by selling the right to use the name, logo, or slogan they invented in exchange for a fee referred to as a licensing fee.

How much can you make from licensing a trademark?

The answer to this question is it depends. Our firm represents clients that license their trademarks to individuals and companies in exchange for licensing fees. Some clients want to receive an annual flat fee for the right to use their trademark. Others want to receive a flat rate each month. While others prefer to receive a percentage of gross revenue earned by the company that is using their trademark. Depending on the perceived value of your trademark, this licensing fee can range from a few hundred dollars to several thousands.

What do you need to license your trademark?

There are two critical things that you need in order to successfully license the name, logo or slogan that you created:

  1. Marketable Trademark. The first thing you need is a money-making trademark.  You need something that is creative, catchy, and marketable. It has to be something that individuals would be willing to pay big bucks to use in association with their goods are services. If you want to learn How to Create a Trademark that Makes Money, please check out our previous blog.
  2. Ownership. The next thing you need in order to license your trademark is legal ownership of your trademark. This means that you must have a trademark that is registered with the federal government. Our blog series How to Make Money with Trademarks series outlines the application process and the steps that you need to take to register your federal trademark. Alternatively, you can save yourself time by hiring a qualified trademark attorney to handle all of the legal paperwork for you. Our firm successfully registers federal trademarks for clients all throughout the country and currently has a 100% success rate (Disclaimer: Past results do not determine future outcomes). Contact us to schedule a free consultation to discuss this process in detail.
  3. Agreement. Lastly, you need a written Agreement. You need a document that will outline the payment, the amount of time you are allowing the person to use your trademark, as well as any other terms and conditions relating to the arrangement. This agreement should be drafted by a trademark lawyer that has experience with licensing. Don’t just use a free form or template that you find on the internet. It may not address all of the issues that you need for your particular deal. For example, it needs to have clauses to protect you in the event that payment is not sent as promised or if the person uses the trademark in a way that was not authorized by you.

Now that we understand how to license a trademark, we will continue our How to Make Money with Trademarks series by discussing how to market your trademarks to make money.


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