7 Essential Types of Licensing Agreements Creators Must Know to Maximise Income and Protect Creativity
Want to know which types of licensing agreements to use for each type of deal? I’m sharing exactly which ones to use in each scenario to maximise your income potential and protect your creativity.
Whether you’re entering a deal with a brand to create content, licensing your existing content, or using another creator’s content, if you’re anything like me, you want to ensure you have the best types of licensing agreements for each situation to maximise your income while safeguarding your creativity. As a lawyer myself who drafts contracts for influencers and content creators like you, I am sharing key things you need to know about the different types of licensing agreements to maximise your income potential and protect your creativity.
You will learn all about which types of licensing agreements to use for different situations, including different licensing examples, and how to use these types of licensing in international business as a global creator.
After learning about the key types of licensing agreements, you will create the best licensing agreements for each deal, maximising profits while protecting your creativity!
This post is all about the three most important types of licensing agreements and how to use them for each unique situation for high income potential and maximum creative freedom.
Key Types of Licensing Agreements
What are the 3 types of licensing agreements
There are 3 types of licensing agreements. What are the 3 types of licensing agreements? These are the licensing agreements you must know:
Exclusive licensing agreement
Sole licensing agreement
Non-exclusive licensing agreement
Don’t know exactly what the difference is between each of these types of licensing agreements?
Then, before you read any further, I recommend reading my blog post on the 3 Key Types of Content Licensing Every Creator Must Master for Successful Deals. It gives a short but in-depth explanation of each type of licensing, which you must know, as these are the basics of licensing.
Licensing agreement examples
Now, let’s get into the different types of licensing agreements you need for each situation.
1. Brand sponsorship agreement
Now, let’s get into the most common one of all types of licensing agreements for content creators: the brand sponsorship agreement.
In the case of a brand sponsorship, the brand is paying the creator to create content to post on the creator’s platform for the brand.
When you receive a contract from the brand, the brand’s contract may stipulate that the intellectual property (IP) rights to the sponsored content you create for the brand will be assigned and transferred to the brand, which means that the brand becomes the owner of that content you put on your platforms. That also means that the brand gets to do whatever it wants with that content on its own platforms, even use it for its own advertising on other channels.
Since you are not a UGC creator in this case (which I’ll get into next), it’s your name and reputation that are being used. The brand becoming the owner of your content means that you have no control over what the brand does with your name and reputation.
That is why I recommend creators insist on remaining the owner of that content and only giving the brand a sole licenseto use that sponsored content.
A sole license gives you full freedom to use your sponsored content however you want, and it also provides the brand with the option to use that content on its own platforms under specific terms agreed in the contract.
Thus, you get to specify when and how the brand may use your sponsored content AND at what price. For example, if the brand wants to use your content for advertising, you can demand that the brand pay you royalties on top of the fee they pay you for creating and posting content on your platform.
Thus, you not only protect your name and reputation, but you also increase your income!
Don’t have a brand sponsorship agreement template that includes these payment options? Get your creator-friendly brand sponsorship agreement on this page of my contract shop! It includes all types of licenses you need to protect your reputation, creativity, and money!
Also, when the brand asks you to use the content for something else you have not initially agreed to, you have the opportunity to give the brand an additional license for that purpose at an additional fee! You can do so by providing a sole license under an additional license agreement. Don’t have a template for a license agreement? Get your license agreement template on this page of my contract shop! It includes all types of licensing agreements in one template!
2. User-generated content (UGC)
A brand may also pay you to create content for the brand to use on the brand’s platforms. It’s not something that is usually attached to your name or reputation, as it’s not made for your audience. Your name will usually not be mentioned. It’s about how any person can use the brand’s product or service.
In most cases, the brand will offer to pay a one-time fee and full ownership of that content or an unlimited exclusive license (that also empowers the brand to do whatever they want with your content).
Since your name and reputation are not on the line in this case, it may not seem like an issue to give the brand full ownership or an unlimited exclusive license.
However, even if that’s the case (which depends on the situation, your popularity, and your chances of being recognised in that content), it may mean that you will not reach your full earning potential.
That is why I also recommend, in the case of a UGC deal, giving the brand a limited sole license to use your content for purposes specified in the contract in exchange for weekly, bi-weekly or monthly royalty payments. That gives you a steady flow of income for however long the brand uses your content. It usually amounts to more money than a one-off payment.
Also, with a sole license, you still get to use the content yourself on your own platforms to promote your work, convincing other brands to work with you, again increasing your income potential!
However, sometimes a one-off payment for a (sole) license with an unlimited period does make sense if the price is right, so in certain situations, you may still want to give a license at a fixed one-time fee if it’s high enough and you have an idea how long that brand will realistically use that content for.
3. Licensing existing content to a brand
A brand may also approach you for a license to a piece of content you’ve already posted on your social media that may include the brand’s product.
That brand may want to show off the fact that an influencer is using their product.
In that case, you could give the brand either a sole license or a non-exclusive license, which will depend on at least the following variables:
In the case of a sole license, only you and the brand can use that content, and you can’t give the same license, under the same terms, to anyone else for that specific piece of content. So, if there’s a chance that another brand or company would want to pay you for that license, you are foregoing an opportunity to make more money. However, if that’s unlikely for that piece of content or the brand is willing to pay a high enough price, a sole license might make sense (if the brand is asking for it).
If, however, the brand is not asking for any exclusivity or is getting that content for a good price, I would recommend giving the brand a non-exclusive license. That gives you full freedom to license that content to others.
Don’t have a licensing agreement template? I sell a template that includes all 3 different types of licensing agreements on this page of my contract shop!
4. Licensing existing content to a creator
Another opportunity that requires one of the 3 types of licensing agreements is when another creator approaches you to use one of your pieces of content.
In most of these cases, it makes the most sense to grant that creator a non-exclusive license to your content, especially since, in most of these cases, the creator is not paying you. What could you ask in return? Well, that also depends on the situation, but you could ask for one or more of the following:
At the very least, you want a proper attribution with your name and a link.
You could ask for a license to a piece of content from the creator in return. Maybe they have a photo or video you would like to use for your platform.
And you want to be explicitly clear in your license agreement how, what for, and where (in a blog post or their Instagram Reel, for example) the creator may use your content.
Want to know exactly what should be included in a licensing agreement? Read my next blog post!
5. Using existing content from another creator
It could also be the other way around. Maybe you want to approach another creator to use their photo, video, or song for one of your own platforms.
In the likely event that you are not going to pay the creator top dollar for their content, you could offer the following:
You always want to offer an attribution to the creator and a link of their choice.
You could also offer them a piece of your content that they may like to use.
In that case, you’ll want to ask for a non-exclusive license.
If you are actually paying for the content, depending on the amount, you could ask for a sole or even an exclusive license in some situations.
If you want to learn about how to request another creator for a license to their content, read my blog post on the 7+ (Legal) Essentials You Need in Your Copyright Permission Request Email (+ Free Email Template).
6. Guesting on another creator’s podcast or YouTube channel
What if you have agreed to be a guest on another creator’s podcast? Or what if you are appearing on someone’s YouTube video as a guest?
The important part to focus on in those cases is how, when and where they may use (clips of) the episode or video, as it is your name and reputation that you want to ensure remains protected.
For that reason, you also don’t want to have a simple release form. You need a comprehensive podcast guest agreement or YouTube guest agreement in those cases.
If you want to learn more about what you need in these types of licensing agreements, I have written in-depth blog posts on guesting on another creator’s podcast or YouTube channel:
3 Key Reasons Every Podcaster And Guest Must Have This Essential Podcast Contract
7 Critical Terms Every Podcast Guest Contract Template Should Have For Guests
7. Having a guest on your platform
Are you having a guest on your podcast or YouTube channel?
A podcast episode or YouTube video with a guest involves the intellectual property of both you and the guest, which makes things a little more complicated, as you have to agree on how you may use the guest’s intellectual property and vice versa.
That is why a simple release form also does not suffice in these situations, and you need a comprehensive podcast guest agreement or YouTube guest agreement in those cases.
I have also written blog posts on this point of view where I go deeper into these types of licensing agreements from the podcaster’s perspective:
Now, you know exactly what types of licensing agreements you need for each situation to maximise your income and protect your creativity.
Using the 3 types of licensing in international business
As a creator, your business is not limited to borders. You’re doing business with brands and creators in different states and countries where licenses may be interpreted differently (especially in countries where English is not the first language). This makes all the different types of licensing in international business a bit more tricky.
It’s crucial for you to have the proper wording in all types of licensing agreements you use.
By using my contracts, which include all 3 types of licensing agreements discussed in this blog post, you’ll have clarity on how and when each party may use the license. Check out my contract shop!
This post was all about the ultimate types of licensing agreements creators must know about and how you can best use them to create the best opportunities in each situation.
Need a license agreement template to grant or receive one of the three types of licensing agreements? Get your template with all 3 options on this page of my contract shop!
Are you a creator who creates content for brands to use on their platforms? Get your content creator agreement on this page of my contract shop!
Are you being sponsored by a brand to create and post something for the brand on your platforms? Get your brand sponsorship agreement on this page of my contract shop!
