Innovation

The concept of licensing has been around since the Middle Ages. Today, a majority of the licensing industry's market share comes from consumer products and merchandise associated with popular intellectual properties. However, up until the inception of Negosh, an online marketplace for licensors looking to sell their licensing to connect with potential licensees did not exist. Negosh’s marketplace also has the potential to democratize licensing, says CEO Ari Zebersky. From Negosh’s online marketplace, not only does it allow businesses to generate IP (intellectual property) revenues, but it also democratizes collaborations and partnerships as all companies listed on the marketplace are interested in participating in licensing agreements. Additionally, due to the online marketplace's strength, Negosh has decided to establish safeguards to ensure that all products resulting from listings on Negosh are manufactured in viable ways. Zebersky states, “For quality, what we do is research and ensure that all the licensees on our marketplace actually uphold a certain standard relating to human trafficking, child trafficking and misuse of labor.” Once negotiations are complete on the platform and a deal is finalized, both the licensor and licensee can use Negosh into perpetuity for communication on royalty reporting, payments, and anything else the deal may entail. Today, Negosh has over 300 companies on its platform, ranging from companies in the entertainment space, animation, video games, music, food & beverage, professional athletes, nostalgia, and a variety of others. Specifically, industry leaders (such as Jazwares) have listed their best-selling Squishmallows products on the marketplace and have nothing but positive feedback, says Zebersky. Negosh's success in having a licensors list on the marketplace has led to closing over 40 deals with the verification that manufacturers are producing products, utilizing viable methods. Zebersky states, “We have three pillars in the due diligence module, they are reliability, viability, and quality.” Lastly, Negosh is compensated for brokering these deals by collecting a transaction fee for all deals that close on the marketplace. Zebersky states, “When those deals actually occur, what typically happens is there's a revenue split involved to its net sales and typically a licensee will give a royalty rate and whatever the licensor earns, the brand earns, and we collect 12% of that.”

Inspiration

As an online marketplace for licensing has never been created before, I asked CEO Ari Zebersky how he came up with the creative and ambitious idea that is now Negosh. Zebersky states, “What caused me to start Negosh took a lot of different pivots and turns, initially we were an NFT marketplace that minted patented copyrights as NFT’s. And then eventually, we recognized the market opportunity in brand licensing. So what ended up happening was we decided to pivot from the original blockchain model and decided to go into licensing after surveying and taking in different client interests.” Additionally, Zebersky did not start Negosh alone; his partner Dylan Karofsky also had a background in licensing and investment banking, and Chief Operating Officer Kyle Blumberg, a childhood friend of Zebersky founded a delivery service startup with each other called Getchya prior to the inception of Negosh. However, all three of them are pop culture fanatics and are passionate about the licensing industry and really believe they can play a vital role through Negosh’s marketplace in ensuring products are produced in viable working conditions and democratizing licensing so parties of all sizes can contribute.

Overall impact

Negosh’s platform is not only maximizing licensing deals for the companies listed on the marketplace but they are also democratizing collaborations and licensing. Specifically, Negosh has a function that allows brands of any size to collaborate with brands listed on the marketplace. CEO Zebersky states, “We are democratizing the licensing industry, prior, the licensing industry was incredibly fragmented. But not only fragmented, it was somewhat of a boys club where who you knew or what you do. Although there were a lot of people trying to enter into the market, it was very difficult for them to enter the market and that’s exactly what Negosh is providing. We are providing an avenue for emerging brands to discover licensees that they had no idea existed before and licensees to discover emerging brands.” Additionally, by involving the emerging brands into the licensing industry, Negosh is fostering a more inclusive and consumer-driven marketplace that has never been seen before in the licensing industry, as it used to be an industry solely based on personal relationships. This approach not only enhances customer engagement but also promotes a sense of community and shared interest among consumers and brands. As a result, the platform contributes to a more dynamic and responsive market that aligns more closely with the preferences and desires of the broader society. In the long term, Zebersky believes that Negosh’s democratization will inspire democracy throughout the licensing and merchandise product industry because the marketplace enables brands created by smaller individual parties to collaborate and network with bigger consumer product corporations. A recent example of this is the collaboration with Squishmallows and McDonald’s this October. Specifically, McDonald’s fans begged the restaurant chain to bring the fan-favorite plush, Squishmallow to Halloween kid's meal toys in the United States on social media platforms X and Reddit until they ended up executing the collaboration. Lastly, in the future, Zebersky envisions that Negosh will contribute to bring to fruition the collaborative deals that ordinary individuals can be a part of by selling their own licenses to bigger corporations. A quote from Zebersky is, “We also work with well-known brands (do not get me wrong), but it also works vice versa, where well-known brands are able to discover emerging licensees that do not know how to get into licensing.”

Business benefit

Negosh was created a little over two years ago, so the company has only become profitable recently. Considering the substantial size of numerous clients featured on the marketplace, the onboarding and listing process was a time-consuming endeavor. However, today there are over 300 companies and corporations listed on Negosh’s marketplace, and over 40 licensing partnerships have been finalized through the platform. Many of these licensing partnerships involve prominent corporations finalizing agreements, resulting in transaction fees garnered from each deal that surpass six figures in value. Negosh’s monetary gains are not the only benefactor of these licensing deals, numerous industry licensing leaders and licensing consultants (such as Jazwares and Firefly Brand Management) are taking advantage of the platform's ability to discover new opportunities to collaborate with unique global brands. Zebersky states, “From an emerging standpoint, we work with NoroNoro, Penbay, The Cat, Nina Ballerina. From a more institutional brand standpoint we work with some pretty well known names, we work with M&M’s, Skittles, and some other pretty well known names. Anyway from the licensee side, I can start naming some, but you would not know them (they are manufacturers).” An example of a large company having success in Negosh is Cynthia Modders, President of Firefly Brand Management - a global brand management and licensing agency firm . She said, “I recently provided Negosh all of Firefly’s brands to load up on their site. I was not really expecting much, but was pleasantly surprised pretty quickly! I am so impressed by the platform and the deals it has generated. We got hits right out of the gate and could not be happier. For a small boutique licensing agency with limited staffing, it is like having an entire sales team! The ease of working on the platform has been incredibly user-friendly.” Furthermore, the deals that Negosh brokers through its marketplace allow licensors to expand their IP revenue. This is significant for brands whose main revenue stream is licensing their intellectual property or for individuals who want to make money from NIL (name, image and likeness) because Negosh allows these parties to maximize their deal-making potential like never before. Zebersky states, “About 40 plus deals have closed on the platform from a variety of different product categories, ranging from stationary, to beauty products, to apparel products. Focusing on some emerging licensees as well, we have had mechanical keyboard manufacturers come on our marketplace and propose deals to brands. So we are really trying to be an avenue for products to find brands.” Looking into the future, Zebersky projects that Negosh’s marketplace will broker 25% of all licensing transactions by 2028.

Social and environmental benefit

Some estimates say that more than 75% of production of products could be considered produced with viable methods. As mentioned before, Negosh plans to contribute to eliminating consumer products that are produced poorly by implementing a due diligence module. This module is designed to verify that products manufactured resulting from partnerships established on Negosh adhere to positive standards. Additionally, just as Negosh’s initiative to democratize collaborations is expected to influence various industries, the platform also aspires to propagate a commitment to ensuring that products are produced in viable conditions. This likelihood is significant because unlike previous scenarios, Negosh represents an unprecedented third party in deals, possessing the authority to halt an agreement should the associated products be manufactured unfairly, a power previously reserved only for governments. In the end, Negosh’s power opens up endless opportunities for positive impact in the global production of licensed products, whether by democratizing collaborations or ensuring viable manufacturing. While they have been successful in attracting industry leaders to join the platform, there remains a significant task in persuading the broader merchandise community to embrace the marketplace's value and join the initiative.

Interviews

Ari Zebersky, Chief Executive Officer

Ari Zebersky, Chief Executive Officer