Even if you are “commercializing” your IP by selling your product or services, you can be overlooking its value. Your IP can help establish creditworthiness and can qualify you to get bank financing to expand or launch a business. This strategy is used by both companies with well known brands (i.e. Levi Strauss) and inventors with new technologies (Thomas Edison used his patent on the light bulb to get a loan to start his company).
An important step in determining the value your intellectual property is to figure out which IP assets must be included. In addition to patents, copyrights and trademarks, other IP assets can have significant value include proprietary sales methods, customer lists, formulations and a number of other process, procedures and systems.
Which assets to include is based upon their relationship to one another. For example, your marketing process IP may be more valuable when combined with other IP assets. That’s because the other assets tend to reinforce each other in the marketplace. For example, your marketing IP bundle would consist of your brand name, logo and trademark. It also includes your websites and any other assets that promote your company and the brand or process.
Some of the most common types of IP bundles include Marketing, Technical and IT assets. Here are examples that are most likely part of your business:
- Company name/logo
- Product names
- Technical designs
- Drawings and manuals
- Product designs
- Operating System
- Custom Application
- Data Warehouse
- Data Mining
- Mailing List
- Domain Names
- Third party software tools
The key to successful intellectual property valuation is to bundle the right IP assets before you start the valuation process. This bundling approach applies to all forms of your intellectual property. It includes both registered and unregistered IP in the form of knowledge and skills assets, such as proprietary training manuals and operating procedures, patented products and technologies, and trade secrets such as formulas, source codes and customer lists.
Rand Brenner is an IP professional whose passion is helping inventors, startups, and businesses of all sizes use licensing to turn their IP into income-producing products, services, and technologies. His decades of experience run the gamut from medical devices to food technology to consumer products. He’s licensed some of the biggest Hollywood entertainment blockbusters including the Batman Movies (1 and 2), and the number one kid’s action TV show, the Mighty Morphin Power Rangers. Rand speaks about licensing and is a featured speaker at investment conferences, trade shows, colleges and startup events. He’s a published writer with articles appearing in several prestigious trade magazine including The Licensing Journal, Intellectual Property Magazine, and License India. Rand also mentors at the Cal State Fullerton School of Business and Economics and is a judge for their startup business plan competitions.