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In this video tutorial, Andrew Krause, co-founder of Event Right, discusses the basics of licensing contracts. He clarifies the distinction between a patent, which protects an invention, and a licensing agreement, which is a contractual deal with a company requiring them to pay royalties while selling a product. Krause emphasizes the importance of understanding licensing agreements and addresses common misconceptions, revealing that many companies may not prioritize patents and might simply agree to pay royalties without needing a patent in place.