Strategic Overview: Universal Licensing Protocol

Last Updated: January 2025 Status: Core Strategy

Executive Summary

We're building the universal licensing protocol for ALL intellectual property - a blockchain-based infrastructure layer that makes licensing instant, automated, and profitable for creators, platforms, and licensees.

The Opportunity:

$600B+ existing licensing market (copyright, patents, trademarks, spatial rights, biometric rights)
Broken infrastructure: manual processes, 30-50% middleman fees, 90-day payment terms, no micropayments
Our solution: 5% platform fee, instant settlement, cryptographic proof, automated smart contracts

Revenue Model:

5% of licensing transactions (potentially $350M+ at scale)
Premium SaaS services ($49-999/month)
NFT minting and staking infrastructure
Profitable token economics with multiple revenue streams

Go-to-Market:

Phase 1: Launch with Nomic ecosystem (Copyrighter, Patentable, Trademarkd, SpatialRights, FaceLink)
Phase 2: Integrate with major platforms (Shutterstock, Spotify, Unity, Adobe)
Phase 3: Become the standard for IP licensing across all industries
Phase 4 (Bonus): AI companies integrate when we have leverage

The Core Vision

1. Useful Protocol for ALL IP Types

One Infrastructure for Everything:

Copyright: Text, images, video, music, code, 3D assets
Patents: Utility patents, design patents, provisional patents
Trademarks: Brand names, logos, characters, franchise rights
Spatial Rights: AR/VR location-based content, digital twins
Biometric Rights: Face/voice licensing, deepfake protection

Technical Foundation:

Blockchain registry (Base L2 for low-cost transactions)
Content fingerprinting (SHA-256, perceptual hashing, embeddings)
Smart contracts for automated licensing and payment distribution
NFT permission tokens (tradeable, fractionalizable)
Staking mechanism for fraud prevention (Proof of Humanity + economic incentives)

Interoperability:

Works across all Nomic projects seamlessly
Open API/SDK for external integration
Compatible with existing licensing systems
Portable licenses (use anywhere that integrates the protocol)

2. Profitable Token System

$LICENSE Token Economics:

Utility:

Staking requirement to register content (fraud prevention)
Governance rights for protocol decisions
Fee discounts (50% off when paying fees in $LICENSE)
Liquidity rewards (stake tokens, earn from transaction fees)

Revenue Streams:

Stream 1: Transaction Fees (5%)

Every licensing transaction pays 5% to the protocol
At $1B annual licensing volume → $50M revenue
At $10B volume → $500M revenue
This is existing money being spent on licensing today

Stream 2: Infrastructure Fees

NFT minting: $10-50 per asset (one-time)
Gas fees: Covered by licensees, paid to validators
Staking deposits: We earn interest on locked stakes
Escrow fees: 1% on high-value deals

Stream 3: Premium Services (SaaS)

Legal enforcement tools: $99-999/month
Advanced analytics: $49/month
Automated DMCA/takedown: $199/month
Bulk licensing management: $499/month (for agencies)

Stream 4: Nomic Ecosystem

Each Nomic app pays 5% to protocol
Network effects: more apps = more value
Compound growth across the ecosystem

Token Distribution:

30% - Early creators (vesting over 3 years)
25% - Platform integrations (partnerships)
20% - Treasury (governance controlled)
15% - Team and advisors (4-year vest)
10% - Liquidity and market making

3. Creator Marketplace & Investor Connections

Beyond Licensing - Enable IP Investment:

Patent Investor Matching:

Patent holders tokenize their patents as NFTs
Fractional ownership (100 investors can own 1% each)
Automated royalty distribution via smart contracts
Built-in valuation tools based on comparable sales
Example: Medical device patent → Raise $500K for commercialization → Automatic profit sharing

Copyright Investment Syndication:

Musicians/authors tokenize future royalties
Fans/investors buy fractional rights
Real-time revenue sharing as content generates income
Example: Indie artist tokenizes streaming revenue → Fans invest $100K for album → Everyone earns as streams grow

Trademark Franchise Marketplace:

Brand owners list franchise opportunities with clear terms
Smart contracts handle royalty collection automatically
Transparent revenue reporting
Lower barrier to entry (no lawyers needed for standard deals)

Discovery & Matching:

AI-powered matching (IP owners ↔ investors/licensees)
Market data showing comparable licensing deals
Automated IP valuation models
Escrow and payment protection built-in

Marketplace Features:

Search by IP type, price range, usage rights
Reputation system (on-chain history)
Bulk licensing for agencies
White-label solutions for platforms

4. Non-Antagonistic Approach

We help everyone, fight no one.

For Creators:

✅ Keep 95% of licensing revenue (vs 50-70% traditional)
✅ Real-time payments (vs 90-day NET terms)
✅ Transparent analytics (see exactly who licensed what)
✅ Find investors for their IP
✅ Enable micropayments (license for $0.50)
✅ Legal protection (blockchain proof)

For Platforms (Shutterstock, Spotify, Unity, Adobe):

✅ Reduce operational overhead (smart contracts automate licensing)
✅ Attract and retain creators (better economics)
✅ Reduce legal risk (cryptographic proof of all licenses)
✅ New revenue streams (micropayment licensing, fractional IP)
✅ Pitch: "We save you money while increasing creator satisfaction"

For Licensees:

✅ Instant licensing (no negotiation for standard uses)
✅ Transparent pricing (see market rates)
✅ Legal protection (blockchain proof of license)
✅ Access to massive pre-cleared library
✅ Micropayment options (license just what you need)

For AI Companies (Eventually):

When we represent 100M+ creators
Easy licensing for compliant training
Legal protection from lawsuits
Cheaper to license than fight
They come to us when we have leverage

Market Opportunity

The $600B+ Licensing Market

Copyright Licensing: $31B

Stock photography: $4B (Shutterstock, Getty, iStock)
Music licensing: $6B (sync, mechanical, performance)
Video/Film licensing: $8B (stock footage, clips)
Written content: $3B (articles, books, educational)
Software/Code: $10B (libraries, open source commercial)

Patent Licensing: $300B

Patent royalties across all industries
University technology transfer offices
Corporate cross-licensing agreements
Defensive patent pools
Our edge: Patent NFTs make patents liquid assets

Trademark Licensing: $300B

Brand licensing and franchising
Character licensing (Disney: $54B/year just from licensing)
Sports team licensing
Celebrity endorsements and likeness

New Markets We Enable: $10B+

Spatial Rights (AR/VR location content)
Biometric Rights (face/voice licensing)
Digital Twin Rights (virtual replicas)
Micropayment licensing (sub-$1 licenses traditional systems can't handle)

Why Current Systems Are Broken

Pain Points We Solve:

Current System	Our Solution
Manual negotiation (weeks/months)	Instant smart contract licensing
High fees (30-50% to middlemen)	5% platform fee
No micropayments (min $1000+ deals)	License for $0.50 profitably
90-day payment terms	Real-time settlement
No transparency	Blockchain audit trail
No usage proof	Cryptographic verification
Complex multi-party splits	Automated distribution

Market Inefficiency = Our Opportunity:

$180B spent on middlemen fees annually (30% of $600B)
We capture this by offering 5% fee (creators save 25%, we earn $30B+ at full scale)
Even 1% market share = $6B annual revenue at 5% fee = $300M profit

Go-to-Market Strategy

Phase 1: Nomic Ecosystem Foundation (Year 1)

Start With What We Control:

5 Nomic Projects:

Copyrighter - Text/code copyright → Target: 20K creators
Patentable - Patent NFTs and licensing → Target: 5K inventors
Trademarkd - Brand protection → Target: 10K brands
SpatialRights - AR/VR location licensing → Target: 15K creators
FaceLink - Biometric rights → Target: 50K individuals

Year 1 Goals:

100K users across Nomic ecosystem
$10M in licensing transactions
Smart contracts processing 10K+ licenses
Prove 95% creator payout model

Year 1 Revenue: $5M

5% of $10M internal transactions = $500K
Premium services: 1,000 users × $99/mo = $1.2M
NFT minting: 100K assets × $25 = $2.5M
Staking interest = $800K

Success Metrics:

Organic usage without incentives
10+ licenses per day
Net Promoter Score > 50
30% month-over-month growth

Phase 2: Platform Integration (Year 2)

Target Major Platforms with Win-Win Economics:

The Pitch:

"Your creators get 70%, you keep 30% now"
"With us: creators get 95%, you keep 5%, we keep 5%"
"Your costs drop 80% (smart contracts vs manual processing)"
"Net: You profit the same, creators earn 30% more, everyone wins"

Initial Targets:

Shutterstock ($700M revenue, 2M contributors)

API integration for licensing layer
They reduce overhead, we process licensing
Creators earn more → switch from Getty/Adobe Stock
Our revenue: 5% of $700M = $35M/year

Spotify/SoundCloud (400M users, 11M creators)

Real-time micropayments for streams
Transparent royalty reporting
Fractional ownership for investors
Our revenue: 5% of music licensing volume

Unity Asset Store ($1B in asset sales)

3D asset licensing with instant payment
Cross-platform licenses (use in any game)
Our revenue: 5% of $1B = $50M/year

Year 2 Goals:

10M creators on integrated platforms
$100M in licensing transactions
10 major platform integrations

Year 2 Revenue: $50M

Platform transactions: 5% of $100M = $5M
Premium services: 50K users × $49/mo = $30M
Infrastructure fees = $10M
Nomic ecosystem = $5M

Phase 3: Developer Tools & Infrastructure (Year 3)

Become the Standard:

Developer Integrations:

GitHub/GitLab - Code licensing in repos
Adobe Creative Cloud - Asset licensing in Photoshop/Illustrator
Figma - Design asset marketplace
Unreal Engine - Game asset licensing
Blender - 3D model marketplace

One-Line Integration:

import { LicenseContent } from '@nomic/licensing';

// Handles all blockchain complexity behind the scenes
await LicenseContent.license(contentId, useCase, payment);

Year 3 Goals:

100M creators using the protocol
$1B in licensing transactions
50+ major platform integrations
10,000+ independent apps using our API

Year 3 Revenue: $500M

Platform transactions: 5% of $1B = $50M
Premium SaaS: 500K users × $49/mo = $300M
Enterprise tools = $100M
Nomic ecosystem = $50M

Phase 4: AI Companies Integrate (Bonus)

By Year 4, We Have Leverage:

Represent 100M+ creators
Timestamped blockchain proof for billions of assets
The standard for IP licensing
$1B+ in annual transactions

AI Companies Come to Us:

"We represent 100M creators with cryptographic proof"
"License easily through our protocol"
"Or face lawsuits from 100M people with blockchain evidence"
"Licensing is cheap, lawsuits are expensive"

AI Becomes Bonus Revenue:

Could add $100M-500M annually
But we're already profitable at $500M+ without them
We win whether they cooperate or not

Competitive Moats

Technical Moats

First Universal Protocol - Only system handling all IP types
Blockchain Immutability - Timestamped proof that holds in court
Smart Contract Automation - No lawyers for standard deals
Interoperability - Works across ecosystem + external platforms
Proven Scale - Millions of transactions by Year 3

Economic Moats

Network Effects - More creators → licensees → platforms → creators
6-10x Cost Advantage - 5% vs 30-50% traditional
Micropayment Economics - Profitable at $0.50 (traditional: min $1000)
Instant Settlement - Real-time vs 90 days = creator preference
Token Appreciation - Early users benefit from protocol growth

Legal Moats

Cryptographic Proof - Blockchain evidence holds in court
Enforceable Smart Contracts - Code is law, no interpretation
Complete Audit Trail - No royalty disputes
Patent Portfolio - 10+ patents on the infrastructure

Data Moats

Pricing Intelligence - Know what every IP type licenses for
Reputation System - On-chain quality and licensing history
Market Intelligence - Real-time trends across all IP types
Valuation Models - AI-powered IP pricing using comparable sales

Why This Wins

We're Not Dependent on Anyone

✅ Start with our Nomic ecosystem (built-in users)
✅ Existing $600B market (not creating new demand)
✅ Platform economics favor us (saves them money)
✅ Multiple revenue streams (not single point of failure)
✅ AI companies are bonus, not requirement

We Help Everyone

✅ Creators earn more (95% vs 50-70%)
✅ Platforms reduce costs (automation)
✅ Licensees get instant access (no negotiation)
✅ Investors get new asset class (fractional IP)
✅ No one has reason to resist

We Have Immediate Revenue

✅ $5M Year 1 from Nomic ecosystem alone
✅ Proven model before external fundraising
✅ Platform integrations add $50M+ Year 2
✅ Profitable from day one

We Scale Exponentially

✅ Network effects compound
✅ Each integration adds value to all others
✅ Token appreciation rewards early adopters
✅ Data moat strengthens with usage

Key Metrics & KPIs

North Star Metric

Total Licensing Volume (TLV) - Dollar value of all licenses processed

Targets:

Year 1: $10M TLV
Year 2: $100M TLV
Year 3: $1B TLV
Year 4: $10B TLV

Supporting Metrics

Growth:

Monthly Active Creators (MAC)
Licenses Processed per Day (LPD)
New Platform Integrations (NPI)

Economics:

Average License Value (ALV)
Creator Revenue per Month (CRPM)
Platform Fee Revenue (5% of TLV)

Engagement:

Repeat Licensing Rate (RLR)
Creator-to-Licensee Ratio (CLR)
Investor Participation Rate (IPR)

Health:

Smart Contract Success Rate (SCSR)
Dispute Resolution Time (DRT)
Creator Net Promoter Score (NPS)

Risk Mitigation

Technical Risks

Risk: Smart contract bugs → Mitigation: Audits by Quantstamp, OpenZeppelin Risk: Blockchain congestion → Mitigation: Base L2 scales to 10M+ tx/day Risk: Key management → Mitigation: Social recovery, multi-sig wallets

Market Risks

Risk: Platform resistance → Mitigation: Win-win economics, saves them money Risk: Slow adoption → Mitigation: Start with Nomic ecosystem (built-in users) Risk: Regulatory changes → Mitigation: Decentralized protocol, no central control

Business Risks

Risk: Insufficient liquidity → Mitigation: Multiple revenue streams from day one Risk: Competition → Mitigation: Network effects, first-mover advantage, patents Risk: Token volatility → Mitigation: Staking requirements stabilize demand

Next Steps

Immediate Actions (Next 30 Days)

Finalize Universal Licensing Protocol technical specification
Update all 5 Nomic projects to integrate licensing layer
Launch MVP on Base L2 (basic licensing functionality)
Onboard first 1,000 creators from existing Nomic users
Process first 100 licenses to prove smart contracts work

90-Day Validation Milestones

Day 30: 1,000 creators, 100 licenses, prove concept
Day 60: 10,000 creators, 1,000 licenses, $10K revenue
Day 90: 25,000 creators, 10,000 licenses, $50K revenue

Kill Criteria: If we don't hit these numbers, revisit strategy

Key Decisions

Token Launch: MVP or wait for traction?
First Platform: Shutterstock vs Spotify vs Unity?
Focus: B2B platforms or direct-to-creator?
Patents: Which innovations to file first?
Fundraising: Bootstrap to validation or raise pre-launch?

Conclusion

We're building the licensing infrastructure layer for the entire intellectual property industry.

The Opportunity

$600B+ existing market with broken infrastructure
6-10x cost advantage over traditional systems
Network effects create compounding value
Multiple revenue streams from day one

The Strategy

Start with Nomic ecosystem (100K users Year 1)
Integrate major platforms (10M users Year 2)
Become the standard (100M users Year 3)
AI companies come to us (when we have leverage)

The Moats

First universal protocol for all IP types
Technical (blockchain, smart contracts)
Economic (network effects, cost advantage)
Legal (cryptographic proof, patents)
Data (pricing intelligence, reputation)

Why We Win

Non-antagonistic (we help everyone)
Profitable from day one (not speculative)
Don't need permission (start with our ecosystem)
Multiple paths to success (not dependent on any single customer)

This is not a pivot. This is the strategy from day one. Build universal licensing infrastructure that works for everything - including AI, when the time is right.