In modern business, intangible assets (patents, trademarks, copyrights, trade secrets, etc.) have become the core of business value creation. According to Ocean Tomo, intangible assets accounted for 90% of the market value of S&P 500 companies in 2020. Valuation of intangible assets is a strategic necessity for a successful company and part of everyday business operations, not an optional activity.
What is intellectual property (IP) valuation?
IP valuation involves estimating the monetary value of intangible assets that can be considered intellectual property. When answering the question of how much my IP portfolio is worth today, the protected and defensible IP rights, market potential, and competitive risks are considered. The main valuation methods are:
- Cost-based method: Estimates how much it would cost to recreate or replace an IOP.
- Market-based method: Estimates value in comparison to the sales or license prices of similar IOP in the market.
- Income-based method: Estimates the profit potential of the IO or the savings from royalties (e.g. discounted cash flow method or relief from royalty).
Why is IO valuation important?
Intangible assets generally have a higher weight than tangible assets. IO valuation helps companies:
- Make informed decisions about licensing or selling.
- Be more attractive to investors by clearly presenting the value of their assets.
- Use IO as collateral in financing strategies.
- Determine damage claims in litigation.
- Align accounting, taxation and regulatory reporting with the real value of intangible assets.
What does the company get from us?
We prepare an intellectual property valuation report in accordance with ISO 20671 and DIN77100 standards and good industry practice. It is also possible to use structural funds support measures or the EUIPO SME fund (IP Scan service) to finance the preparation of the valuation report. Depending on the purpose, the report may also contain additional information, but the standard has the following elements:
- A comprehensive overview and analysis of the current situation.
- An overview of competing technologies/brands and market opportunities.
- Risk analysis.
- A comprehensive intellectual property protection strategy.
- Depending on the intellectual property, we also discuss its protection ability, the possibility of enforcing new patents, trademarks, etc., restrictions arising from standards and legislation, etc.
We prepare each assessment according to the needs of the company and the available source data. SEND A REQUEST.