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Maybe, like this writer, you like to sit around and dream up new gadgets, household products, stories, economic systems, and so on.
But maybe, in addition to sharing this creative streak, you also share my lack of ambition.
I don’t mind working hard, but I don’t want the long-term commitment or risk involved in building prototypes, getting patents, and developing sales platforms or marketing plans.
If you feel the same way, you might be wondering how to cash in on your creativity without risking big money on product development, and without working for years to build a business and market a new product.
Fortunately there are ways to get paid for your ideas without all of that work and without risking your life savings.
In fact, I’ve used a few of the strategies listed below to make decent money from my ideas, and you can do the same.
There are no get-rich-quick plans here (that probably requires more ambition), but you might create a nice side income from your ideas. Let’s get started…
1. Win Prizes as a Problem Solver
A friend burns his tongue on hot coffee. Right away you imagine a cup that notifies the drinker when the contents have cooled to just the right temperature.
Okay, you’re a great problem solver. But how do you make money with this skill?
Try contributing to an “open innovation platform” that pays cash prizes.
InnoCentive, for example, uses crowdsourcing to help businesses and other organizations find creative solutions to various problems.
As a “Solver” (registration is free), you can submit new ideas for various “Challenges” created by “Seekers” (businesses and organizations). If your creative solution is the one chosen you win a cash prize.
How much can you make? Innocentive says, “The average award amount for a Challenge is $20,000 but some offer awards of over $100,000.”
Most of the problems are pretty technical. For example, the Challenge Center currently shows 61 “Solvers” working on “Highly Breathable Weather Solution Materials” for a $25,000 prize, and 174 Solvers working on “Detecting Leaks and Flaws in Water Pipelines,” for a $75,000 prize.
The less-technical challenges tend to have smaller prizes. For example, “Addictive Jewelry Concepts” (new ideas for jewelry) has total prize money of $10,000, possibly divided by several winners, with the lowest payout set at $2,000.
And, not surprisingly, the easier challenges also have more solvers. There are 500 currently working on those new types of jewelry.
Here are a few other open innovation platforms that pay out cash prizes:
- IdeaConnection – Technological and other challenges
- Top Coder – Software crowdsourcing competition
- Ideaken – Crowdsourcing for technological challenges
- Challenge.gov – Prizes for solving for government-level problems
- Green Challenge – Crowdsourcing competition to save the world
2. Put Your Ideas in Articles
You attach a small reservoir of water with a tube in a hat, and it moistens your shirt with a constant drip. In a hot, dry climate this makes your shirt into an evaporative cooler.
Great! Now how do you make money from this idea without challenging your patenting and marketing skills? Write a how-to article for a backpacking or hiking blog.
As a freelance writer, I love to cash in on new ideas in articles I sell. Most blogs and websites want proven concepts, but sometimes you can sell an article that starts with something like; “Try These 10 Untested Ways To…”
If your ideas don’t require a large investment of money or time to test, you can try them out first and then write about your experience.
For example, I sold an article on ways to save money on cat toys and furniture, which included ideas I tested on my own cats (like attaching feathers to remote-controlled toys and cutting holes on alternating sides of bookcase shelves to make a climbable “cat tower”).
By the way, all of the new inventions mentioned in this article came from my own brainstorming, so yes, I am making money writing about my ideas.
If you do try selling your “ideas articles,” look for websites that pay you $50 or more. And if that doesn’t work, consider the next great way to make money from new ideas…
3. Create a Website or Blog
In a daily brainstorming session you imagine kites for emergency boat propulsion, tiny poetry books attached to wine bottles for romantic evenings, a home currency sanitizer, and a way to solve the problem of homelessness. How do you cash in on your dozen daily ideas?
Start a blog or website.
A dozen years ago I spent a weekend building 999ideas.com, a plain-looking website where I shared my ideas and collected revenue from pay-per-click ads. I wrote about new forms of government, backpacking inventions, ways to make money and, well, anything.
The bad news is the site may be closed down soon, since it makes only a few dollars per month, and I haven’t even looked at it in years. But the good news is that during its best years it made over $1,000 per month.
Even my website on metaphorology, where I shared my ideas on using metaphors to better understand and improve life, made a little money for a few years (it’s gone now).
Study up on how to build a profitable website. I won’t offer advice in that department since, despite hard work, many of my websites really only succeeded due to luck, and because I started when there was less competition.
But the thing about a blog or website is that you can start one for a few dollars, or even for free using WordPress. After that, just have fun sharing your new ideas, and once you generate traffic you can use any of the many ways to monetize your website.
In order to get started setting up a website, you’ll need a domain name along with hosting. I personally use Bluehost – hosting at only $3.95 and your domain is free for the first year. Most hosting plans can cost up to $8 or more per month.
4. License Your Ideas
You have an idea for a helium mattress. When the blankets are removed in the morning it floats up to the ceiling, freeing up floor space in a small apartment.
But you don’t want to even think about making a prototype or spending thousands on a patent, let alone manufacturing the product. So what can you do?
License your invention idea to a company that will handle all the hard work.
When you license an idea you get a royalty based on what the licensee makes with the product. Rates vary by industry (and how well you negotiate). A guide to royalty rates shows an industry standard of 4.8% for consumer goods, 10% for footwear, and 4.4% for new foods.
Making 4% may not sound like much, but 80 cents from a $20 product adds up if the licensee gets your gizmo into Walmart stores and sells a million of them.
When presenting your idea to a company you can do so with a “non-disclosure agreement” to protect yourself or, for greater protection, you can file for a provisional patent for $125.
The latter gives you “patent pending” status for a year, after which, if you haven’t sold your idea, you’ll have to complete the patent process (expensive) or give up your rights to the product.
Licensing is tricky, but there is help available.
For example, Harvey Reese Associates evaluates your idea for a set fee (currently $189) and, if they like it, offer to help you get it licensed for a 40% share (but you have no obligation).
Reese explains that he will pay for modifications, (if needed), photos, prototypes, all travel expense to sell the idea, etc.
In addition to helping others, Reese himself has licensed more than 100 of his own products.
His company doesn’t try to sell you expensive services, and there are no hidden fees. When I paid for an evaluation a dozen years ago, Reese’s report politely explained (in detail) exactly why my “Deal-a-Poem” card game wasn’t a good prospect, and that was the end of that.
If you decide to go it alone, read up on how to negotiate a licensing agreement. You’ll want to understand why the royalty should be based on sales, not profits, why a non-refundable advance is a necessity, and so on.
5. Write an Ebook
You found a simple way to connect a motion detector to a recording of a barking dog to scare off burglars, you’ve identified the most impenetrable bushes, and you have twenty more home security ideas. How do you make money from your brainstorming?
Write a small eBook on “How to Make Your Home Safe,” and sell it online.
Kindle is my preferred eBook platform. It cost nothing to set up an account, and if you price our book at $2.99 or higher you get 70% of every sale. You can price it as low as 99 cents for higher sales volume, but then you’ll only get 35% of each sale.
My KIndle book full of lightweight backpacking ideas (no longer for sale) made me a couple thousand dollars and took only a weekend to write. I even sold a few dozen copies of my essay books full of ideas in the areas of politics, linguistics, and personal psychology.
ClickBank is another eBook platform you can use. It charges about $50 to set up a product (books and other downloadable items), and then it takes $1 plus 7.5% of each sale. Unlike with Kindle, you need to host the sales page on your website or blog.
When my websites had good traffic I used them to promote various books I sold through ClickBank, and I made tens of thousands of dollars over the years.
I wrote an ebook called 101 Free Money Making Apps. While I don’t bring in a fortune, I bring in a passive income of about $25 per month.
6. Use Your Ideas Yourself to Make or Save Money
If you have creative ideas for making or saving money, and you can’t get paid for your ideas using one of the strategies above, you have one last option: Use them yourself.
For example, the other day at the grocery store I clicked the button to get an extra $60 cash back when paying with my Discover card.
It’s one of the few credit cards that allow this, so I asked myself, “How can I use this feature to make money?” (Ask questions like that a lot and you’ll probably have a few good ideas.)
I realized that if I did it for every small purchase I could soon have $1,000 cash, which I could deposit in a Netspend savings account to earn 5% interest. I pay the credit card balance off every month, so I never pay interest charges.
If I kept doing this every month I would always have $1,000 or so of free money invested. Yes, I know I would only make $50 per year (or $20 in my more convenient 2% savings account), but maybe you can find a more profitable idea starting with this basic concept.
I include ideas for saving money here because it’s really the same as making more. In some ways it’s better because you don’t pay taxes when you find a way to save $20, unlike when you earn $20, so you’re actually a full $20 further ahead.
For example, if you find a dozen new ways to save on utilities (our neighbor recycles dishwater to water the garden), you could save, say, $50 per month. That’s $600 extra in your pocket every year.
Go for cash prizes for creative solutions, write articles on new ways to do something useful, start a website, sell a product idea to a big company, write an eBook, or use your creative ideas in your own life to make or save money.
One way or another, you can get paid for your ideas. So start brainstorming!
If you’ve ever made money with your ideas, please share your experience below … and keep on frugaling!