Dear Rich: I built my business on printing my designs on fabric and making stuff. Now there’s a handy service (VIDA) that makes stuff with your uploaded design and sells it to others. That makes it easier. I am just leery of any “catches.” Can you look at the licensing agreement?
VIDA is a socially responsible e-commerce company, launched in 2014, that connects designers with manufacturers around the world and sells the resulting products at its site. Artists and designers submit original fabric designs which, if accepted, are converted to fabric and used for apparel and housewares merchandise. The designer receives a 10% royalty for each sale.
Nonexclusive and exclusive licenses. According to Vida’s Designer’s Submission and Licensing Agreement, by submitting your designs, you give Vida a nonexclusive license to reproduce your design primarily for marketing and promotional purposes. Once an order is made, you give Vida exclusive rights to sell your design in the designated categories (classes of goods that you selected when you submitted your design).
How does Vida’s license stack up?
- Royalty: Artists receive 10% of net revenue (gross revenue minus discounts, shipping and similar expenses). In general, fabric design royalties typically range between 2 and 10%.
- Length of licenses: You can terminate the nonexclusive license 30 days after providing notice. You can terminate the exclusive license within one year after providing notice. Most fabric licenses are for one to three years with one-year renewable terms.
- Limitations: The exclusive license is limited to the designated categories that you select when you submit your design. If you don’t want Vida to have exclusive rights for certain goods, don’t select them as designated categories.
- Reliability of the licensee: The company appears to be well-funded and has been around for almost three years (a good sign for a start-up).
Though the agreement (specifically, a merchandise licensing agreement) is relatively friendly to artists, there are some details we are not wild about—for example, the ability of Vida to freely assign your exclusive rights.