Ep. 153: Using Your IP as a Saleable Asset w/ Erin Austin
Did you know you could be sitting on a goldmine in your business? Your intellectual property, or IP, has the potential to be its own income stream without you having to market it!
It may sound too good to be true, but it’s not.
In this episode, I talk with Erin Austin who’s an expert at helping entrepreneurs package and sell their brilliance. You might have a framework or methodology that could be sold in a variety of other formats to bring you more revenue. And it’s possible to sell an entire business if you set things up the right way.
I learned so much in this episode and I know you will too. So even if you aren’t looking into this right now, I suggest listening to get your mind going with ideas of what’s possible in the future.
Links:
Plan for Profit: bit.ly/planforprofitguide
Erin’s Website: www.thinkbeyondip.com
LinkedIn: https://www.linkedin.com/in/erinaustin/
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This sell it, sister interview is so incredibly interesting. I know this is one where you're going to be like, wow, I hadn't really thought of that. I'm guessing. I'm assuming if you're anything like me, you're probably going to think like, this is something I hadn't even considered.
Um, and it might be one that depending on what growth stage you're at in your business that you want to bookmark it. Come back to, but it is absolutely fascinating and it gave me so much. To think about. So I'm chatting with Erin Austin today, and Erin is a consultant and lawyer who combines her 25 plus years of practicing law, including roles as COO and general counsel at IP driven companies to help the founders of expertise based firms build and protect saleable assets so that the business is ready to sell.
When the founder is ready to exit. Aaron special talent is finding the quote-unquote Rembrandt in the attic that hidden or overlooked asset that can be leveraged for maximum value. But graduate of Harvard law school, Erin has been in-house and outside counsel and an executive for large and small companies, including Warner brothers lions.
MGM teaching strategies and MP3 USA Corp. She loves to share her experience appearing in podcasts, webinars, and publications, including the seven figure consultant podcast, city of contracts, podcasts, and legal. In her spare time, Erin clears brush on her pharma searches for the perfect gluten-free baguette and plays her son's drums.
So this one is going to be incredible. Definitely check her out when you're done listening@thinkbeyondip.com and she's also on LinkedIn at Erin Austin. All of those links will be in the show notes as well. And now onto the interview. Hi, Aaron, welcome to the, sell it sister podcast. I'm really, really excited to talk with you today.
Thank you so much for having me, Erica. I'm very excited to be here as well. Yay. Well, I know, you know, in the, in the intro I shared your bio and all of that, but before we dive into what you do, I would love to hear more about. Like how you got here. I'm always so curious about people's origin stories, because it usually ends up being something really interesting.
Yeah. Well, mine goes back, uh, probably five years now and really, it was kind of realizing the outsized influence that wealth has in our democracy, frankly. And, uh, and you know, shame on me. Thinking everyone has, you know, kind of equal votes. And, uh, and so really it was like, how can I use my big company experience, um, to help like the segment of the population that will support the things that are important to me.
And really what I was after is figuring out how do we create an economy that works for more. Okay. And so, uh, you know, at the end of the day, you know, having wealth is gives you boys, it gives you impact and influence. So how do I get more wealth in the hands of people who are supporting my values? And, uh, and so for me that meant, you know, more wealth in the hands of women, you know, Studies show that women give more of their wealth to charitable causes.
They share it with the communities, they support the families more with it. They, um, believe that, you know, being able to support charitable causes is the most satisfying part of having wealth. And, uh, you know, they include their children in their philanthropy as well. So I'm like, that is what I want to focus on this next chapter.
I mean, I've been a lawyer for a very long time and, uh, w what do I do in this next chapter? Um, of, you know, working with this segment of population that I think, you know, who I share some values with, and then combined with the fact that I was having kind of my own midlife crisis, if you will. Um, and that, you know, You know, to be my own note, kind of meta I'm my own avatar of being an expert in something, but who has not built a business that is scalable or saleable.
And, you know, I've made a very comfortable income as, as a solo. Um, and, uh, but you know, I really. You know, I'm the business. There's nothing else my business, but Aaron. And so combining the two got me to, okay, well let me one, you know, focus on building a business. Can scale and hopefully sell some day while working with this, you know, with women and helping them realize that wealth that's built into their expertise.
They're kind of circular, but yes, that is. I love it. I love it. I, my, my mission is very similar and same like timeline and everything. I was running businesses. And then at the end of 2016, I was really just like, You know, what, something, something needs to shift. And I really felt like my whole life, I had really pushed against like earning money and that, that should be the goal and everything.
And then it was just kind of like, I need to surrender that like this, these are the waters that we swim in. And rather than like trying to swim upstream, like why don't I try to swim downstream and take other people with me. So I love like the origin story is I, we are right there. Cause it's the same.
Like the, all of my clients are people who are more interested in wealth for. Changing the world then just for the sake of accumulation. So I love it. I love it. So I'm really excited to talk about this because I obviously in the, like in the world of online business, there is a lot of talk about scaling and I am somebody who is all about sustainable growth and now I've actually been referring.
To it more as like regenerative growth. So not just like sustaining it, but you know, so that it can replenish itself. But when it comes to selling a business, that is something I a know, nothing about and be much like the questions you were asking yourself. Like, when I think about my business, I'm like, yeah, my business.
Me. It's like people who want to work with these, I'm like, I can't even, I can't even conceptualize it. So I'm just, I'm really thrilled to have you on, but yeah. So wherever you want to start, like, if you want to kind of explain those differences and stuff first, just to kind of get the lay of the land, that would be great.
Sure. Yeah. Well, I look at it as kind of, we start with the unsustainable business that. You know, the lawyer selling her time. And so it's an hourly based business. There's absolutely. Um, you don't have kind of real stability into the business. You have, um, you know, maybe you have some whale clients and. You know, every engagement may be a bet, the business engagement.
And so that is a very scary place to be. It's basically like you have a job, but without benefits, right. That's kind of the way I described that versus the next level would be. Uh, sustainable, which I equate with stability. So maybe instead of having a, kind of an hourly, you have a retainer-based business, you're still kind of selling your time in a way, but, um, you are able to decouple your, your time from your, um, income in some ways, because what that retainer base, you know, the better that you get.
Delivering the more profitable that retainer becomes. And so, and you're able to, you know, kind of, um, have a more diverse client base. And you're starting to be known as the expert. Um, and so, so you're not just an order taker, like you have kind of your area of expertise. And then for when you scale, you are actually like adding those systems in place.
It could be with the team. It may be just, you have systems that you're using, you're using technology, you're using, you know, maybe a productized services. You're doing things to help you. Create, um, scale. And by that, I mean that you're, you're not only is your revenue going up, but the profit is also going up.
So you're getting more leveraged from what you're doing. So the more you work, the greater. Um, the, the, the profits. And so that would be kind of a scalable and a lot of times that means introducing intellectual property at that, that level as well. And then finally, the scalable level is, you know, you have, uh, a scalable, scalable level is when you have that leverage built in your, to your business, but you want to make sure that you have pieces in place that would be attractive to an acquirer.
So when an acquirer is looking at a company, they want to say like, why should I buy you? Instead of just building it myself. Right. And so, uh, so you need to have some type of exclusivity in your business. It could be intellectual property. It could be your positioning. It could be your relationships, it could be your community.
Anything that would be less expensive or, you know, it could even be a possible for someone else to recreate. So it's makes more sense to buy what you've built or develop. Then to do it on your own. So that's the exclusivity piece. And the other piece is that it has to be sustainable in the hands of the buyer.
So again, if it's just you, like, let's say I have all those, I've got this exclusive and all this stuff, but I have no systems in place or the relationships are mine and not my businesses. The community is loyal to me, but not the business. Like then. When someone buys it, it all goes away. So they need to know that, you know, you will have your projections saying like, okay, based on what I've done today, you can expect to make X amount if you buy my business.
And, but there has to be something there to support it. They have to be able to go in your business and see, yeah, I see that, you know, she has this type of model. These are her, you know, the processes she has in place. This is the team that it will stay with the business. And, uh, so they can see that what your success will be replicatable or even, you know, obviously they want to have even more success than you have.
That's kind of idea, but, but at least they're not going to lose money by buying your business. So I kind of have a, I do have a visual representation of this online on my website, that kind of shows that kind of, uh, increase in, in. In the saleability, put it that way. Yeah, that is so fascinating. And I all, I can think.
Okay. So like thinking of me and like my clients and the list, like a lot of my listeners is, uh, they're either like a service provider. Like maybe they do branding or copywriting things like them, or there's some type of coach consultant or strategist where it's really. Them and their knowledge that they are imparting on someone else.
So like I, and I do have a few people who make products, which for that, you know, I could see it's like, if you just teach someone how to make your product and they want to take it over, I like my brain is like, yes, I, that makes perfect sense. I get how that could be a thing. Um, but when you are like a coach consultant, strategist service provider, How can you start to shift the thinking towards like an asset or something that could potentially be salable?
Yeah. Yeah. I mean, you need to start thinking about processes really is the key to it. So whether you are, um, You know, want to add to your, a team member, either someone who's supporting you, those pieces that don't have to be you so you can create, leverage that way, or it can be, you know, if you have something that really is expertise, a certain level of expertise is required, then you add additional experts to your team and then you train them in the way that.
You do things. Um, and so that is a way to, to create, uh, that scale internally, um, and the, you know, a more profitable way to do it is to help other people use your methodology. So a lot of people come to me too, cause they have. Uh, methodology and people are asking whether or not they can use it. And so to be able to create some sort of program, either licensing program or certification program, or, you know, maybe a train, the trainer type of process, then they can, you're not the only one.
Um, selling your methodology. You have other people who are also selling your methodology. And, uh, and so one, you have the revenue from those third parties, but two, it just kind of creates it, expand your brand. Like you just have this vast world expanding your brand. Um, and so, but you, but it does take that, um, a mindset shift that what you do can be done by other people.
Now people do definitely have a problem. With the, okay. I do it. It's in my head. All my clients just want to work with me. If I try to have them work with someone else that they go away. And at the end of the day, your clients want a result. So can you deliver the result that they need in a way that doesn't require you?
Personally providing the deliverable. So, and so that may take some time to figure out how to do that, but that is the chef. Like to know that let's assume that no one will ever be able to do it as well as you can. Let's say that you are a hundred, will your client be upset to get 19 instead of a home? So long as they get the desired resolved.
Right. And so we kind of make certain, uh, and you know, maybe we can get to 100, but even at 90, like I bet your client will still be happy with the outcome because they, they, they won't make the connection between 190. They won't actually have experienced don't hundred. Right. You know what 100 is versus 90.
They don't know what 100 is versus 90 so long as you make sure they're satisfied with the deliverable and that they're the desired outcome that they want. If they get it. That makes sense. That makes sense. Kind of like, just thinking about since you're in law, like if there was a prestigious law firm, it's probably very hard to get like the.
Partner as to be a client of that person, but you could still get a really good attorney that works with that firm and like was kind of maybe mentored by that person or whatever, and still okay. Okay. Yeah, that makes right. I mean, the people whose names are in. You know the names of law firms, if they're still alive, generally aren't, you know, drafting your contracts.
Right, right. They'll take you to lunch, but they're not, you know, doing the work so after yeah. That's a great example. Yeah. Okay. So now I have a very good friend of mine is thinking about, and she's sort of in the process of. Uh, taking a methodology that she uses for her clients and packaging it up in a certification program.
Uh, and I know that there are definitely, um, you know, like you were saying, like licensings and things for other people's programs, like for instance, in my group coaching program, If I knew, like I don't teach copywriting, but it's obviously an important part of growing your business. So if I knew somebody with a really brilliant copywriting program and they allowed me to license it, like I could use it in the program.
How does with licensing, how does it usually work? Is it like a one-year license? Is it like, I'm just, I'm so curious about it. Cause I know it's a thing, but I don't really know the finer points of how it works. Yeah. So licensing basically means that someone has a piece of intellectual property and they're giving someone else permission to use it.
And so that is a kind of a. The definition of a license. And so that could be for a term. Typically the term is annually. It could be month to month, depending on the nature of the, it was something that could be delivered very quickly. I'm not thinking of an example right now, maybe. Um, I can't think of an example of something where you would deliver the whole thing within a month.
So typically it would be on an annual basis. Um, there's different ways of charging for it. You could charge a license fee that is an annual, a monthly, you know, think about software that you have, right? So you get your, your, um, you know, your CRM, whatever you use for your CRM or your convert kit, and you have a license to use it, you pay monthly for it or pay annually.
Do another, and then there also levels of intensity. So if you have one user, you know, it's one, uh, fee versus if you have like an enterprise based solution and cause you got to have a hundred people using it, then that's a different thing. So it's not just about time. But it's also about intensity of use.
So there's other ways to do that. Um, some things like a training program, you may license to someone and they pay you by the seed. So if you know, you you're, you're, let's say they're going into a company to deliver it. And if you know, they're training 50 people, it's different than if they're training 500 people.
So. Gotcha. Gotcha. That is so fascinating. So this all sounds very much like something. That is like, not a DIY, right? Like you're, if somebody is thinking about doing this, like go, go to somebody, like, cause it seems like this is something that could be very easily. Like you could sell yourself short or you could have.
Get in like a legal mess or whatever. So yeah, kind of the steps that usually like, if somebody is like, well, actually I, I do have my framework and it's really good and it's getting people results. And I would like to start exploring this, like, what are those next steps that they should do? Yeah. Yeah. The, the answer is, yes, it's not a DIY job.
It is. A lot of times, we don't have all the rights that we think we have. And it's one thing when we're using something internally. Maybe, you know, maybe you have, um, some third-party, um, materials in there. Like I have one client who, um, has a license to the, I think it's called the trusted advisor. And so he uses some of those materials with his clients and he has a license for the hat and that's fine.
You can do that. But if you, he packages that up as part of his methodology, Because he has his own methodology wrapped around it, but in the middle of it are this third-party materials, but you can't package that. And so that to third parties, right? Then you are going to get into trouble, or let's say you had a subcontractor that helped you develop some of these materials, but you didn't have anything in writing with them.
So you actually don't own those materials. If you didn't have anything in writing with them, the subcontractor actually owns them and you just have a license to use them. So making sure that you have all those pieces in place before you. Kind of elevated profile, you know, once you start kind of soliciting licensees, um, and I imagine there'll be some sort of marketing around getting, you know, just offer this, your, your program, you re raise the profile of something and the higher, the profile of something is the more scrutiny it gets.
And the more risk there is that any weaknesses in that foundation will, will start to show. And so you want to make sure that you have all those pieces in place. If you have something that hasn't been registered, you know, you can copyright laws, copyright attaches the moment that you create something, you don't have to register it.
And a lot of people don't register everything. Um, but, but if you're going to package. And license it or have a certification program built around it. You need to make sure all those things are registered. Um, you may have been using a trademark that, um, you never went through the process of having properly registered again.
You can no use that TM next to it without registering it. Right. And no one will notice, like, you know, you're doing your thing, no one notices, but then suddenly you're putting it out there. You know, like, wait a minute, there's a problem there. And so, you know, you want to just make sure that you have everything in place, all your IP rights, you know, your contracts, your registrations in place before you build on top of it, because then you'll just, you know, that that's kind of way I look at it.
Yeah, yeah. Yeah. That makes, that makes perfect sense. And I know, um, Gosh, it's trademarks. It's such a catch 22, cause it's hard. Like an and I, I have a friend going through it right now with one of hers that she, a name that she'd been using for a long time. And, and she's somebody who gets trademarks. She has a lot of things trademarked and she was, then she was finally getting around to like trademarking this and somebody.
Came along and happened to file somebody who was using it for less time, happened to start the filing process sooner. So now she's in a back and forth, like it's just, it's a whole thing. And, um, she always said that like her, the attorney, like who's helped her file them is. You know, get like file on something that you would be brokenhearted if you lost.
Um, and it's good like it, but on the flip side, like if it's an extra expense, obviously for business owners where you're like, okay, what's like the gamble, like how long can I go without. Paying the money to file. And you know, it's, it's such a, such a guessing game cause it's like, yeah, you never know if someone's going to want that.
But, um, the name of this podcast is actually trademarked and I I've had to like enforce it and stuff before. So I'm really good that you had the ability to enforce it. Totally. And so I was really, really glad that I had done. That I had done that and everything, but, um, but yeah, that's, that's really interesting about just like everything you mentioned all like getting the foundations legally secure before you start to go through all of the, the whole rest of the process.
So, yeah. Yeah. And I can relate to the idea of, you know, having something like, oh, I love this name and whatever. And, but things change. Right? And so I could have had five different ideas trademarked in the last five years that I've been going through this process and I would have lost money on every single one of them.
That's not to say they don't do it, but you know, you may want to let it settle a little bit, you know, before. Cause you know, Cheap. Right. But, um, you know, really how you're going to use it is what's important. So yeah. Yeah, absolutely. Absolutely. Well, this was, so this is so fascinating and now it's like, it's got my, my gears turning of like, oh, I wonder what, you know, like methodologies or things in my, in my business could be.
It could be utilized or like yeah, like a coaching certification or just all of those things. It's almost like the sky, the sky is the limit, but it's cool. It's cool to think about. Yeah, there's different, you know, again, there's different levels of it. So depending on. The profile of your business or your methodology, you have certification program, obviously it works better when you have a certain positioning in the marketplace so that someone else will want to borrow your positioning.
Right. Cause that's basically what they're doing and you know, so that's when certification works better versus licensing, you know, you may have like a system. Um, but that's kind of behind the scenes. So no one kind of is aware of it, but somebody else with less experienced than you who starting, you know, their branding, you know, consulting journey, like to license it and use it in their business would be a big step up for them rather than trying to figure it out on their own.
Some people don't want to figure things out on it. And so that helps them, um, that gives them that step up. Um, initially still get the benefit of. Somebody else's know-how and somebody else figuring out before them, even if it's not quite, you know, the, the recognition in the marketplace may not support certification, but so there's different ways to look at it.
Interesting. And lastly, is there, is it the kind of thing where someone like you could, like where you would actually help people. Uncover what they could also have in their business. Right. Like if, sort of they're like, I don't know. It could be maybe this, maybe this, maybe that like, are you actually able to be like, okay, well, like let's put it all out on the table and see what we got.
And like, I think that for right now, option a is going to be like the most viable solution. Yes, absolutely. That is how I work with my clients. I start with a. Um, blueprint, I call it. So whether they're at kind of the stable level and want to get to the scalable level or they're already scaled. And when I get to the exit level, as we start with a blueprint where I go on, I do a full legal due diligence of their business to make sure like that IP foundation is in place.
And so we look at from all angles and, uh, and then, you know, if things need to be fixed, then we know what needs to be fixed before we go forward. And then we also look at it from a strategic lens to see, okay, This is where you are. This is where you want to be. Like, how do we get from a to B and then, you know, map out or blueprint out the process to get from a, to a, to B.
And so, you know, for instance, um, my one client who, um, has a very stable business, she has a team, um, in the high six figures of revenue. And in order to sell, like for people to be really interested in at least get to that $1 million in revenue. Right. And so. For us it's mapping out, like, how do we get from, you know, 600,000 to $1 million in revenue.
Right. And so it'll, so it will depend. So we'll look at, okay, this is your current model, and this is how you've scaled so far. And what kind of revenue model, what can we add in revenue models that, you know, maybe you don't want to add more to your team, but let's add this other type of program. Um, or a certification or licensing, like what can we add that will help you kind of drive revenues up without increasing costs?
Because otherwise it doesn't help that much. Yeah. Oh my gosh. Okay. So that's cool. That's awesome. Cause I imagine it would be really like, I imagine some people are like, yep, this is the thing. I know what I want to do. Help me do it. And other people who are less. I don't know, it could be five different things and need help sorting, sorting all that out.
So, yes, so we had people come to me going, I just want to certification for it. Like I know this is what I want, you know, and they know so cool. So obviously all of your, your contact info and links and everything are going to be in the show notes, but I would love to know where can people learn more and how can they.
You know, start exploring this or even like start working with you. Wonderful. Yeah. Well, uh, think beyond IP is my website, uh, and, uh, that is where I have. Kind of building reputation as a graphics queen. I don't know if that's a good thing or not, but basically like whenever someone, if I get a couple of questions about the same topic, like I'll create a graphic that kind of answers.
I just I've always liked to have one eye. It keeps it simple because you have to keep it simple and it just kind of has the basics. It gives you the overview and for a lot of people, it helps when they can see something kind of in how it all works together. It really helps them. So I, I I'm like always with another graphic, so go to my website and you can sign up for, um, all my freebies.
You sign up, you get everything, access to everything. Um, things that I have up there, uh, well, everything I've ever created is up there, but the, the latest things up there are a, I did a chart that compared and contrasted all these different types of licensing programs from kind of the simple. Um, uh, licensed through, you know, a train the trainer through certification through, you know, franchise, not that I recommend franchises, but just kind of seeing what, what all the issues are and the pros and cons of each.
And, uh, and then I also have a self assessment up there, um, that shows the hourly to exit kind of that's unsustainable to saleable that we talked about at the beginning of the show that kind of illustrates this. And that you need to be thinking about to make that journey through that. So, and then, um, yeah, and then hopefully Q2, this year, I'm also going to have an hourly to exit podcast.
So we looking out for that. Well, I'm very excited about that. And I guess what I need those photos for
before I started recording, we're talking branding photos. So I'm pushing her to get more here.
Yeah. Yeah. So it's yeah, a lot of stuff happening this year. Very excited. I love it. I love it. Well, thank you so much for coming on. This was fascinating. And, uh, and I really think that it's, it's good to think about because even if you're still, you know, only a couple years in, I think that it's so, especially for most women, like, we're just, we're not inculturated, I guess.
Maybe unless maybe you like live in a family of like long-time high powered entrepreneurs or something like that, but we're not like inculturated to think. Oh, your thoughts from your brain could actually be like Val, like super valuable. You could sell that to somebody and you know, so it's such a cool way of looking at it.
So thank you so much. I know people are really going to get a ton out of this, this episode, and definitely be sure to check out all of Aaron's resources, get on her list, check out that podcast. I just, I know it's going to be great. Awesome. Thank you so much. It's been so much fun. Thank you. Thanks so much for tuning in to this episode of the, sell it sister podcast.
