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How Companies Value IP and Use it to Raise & Optimize Capital

Capital Insights' Q2, 2013 issue interviewed IPVision executive Joe Hadzima for the article "Capturing the Imagination" which explores the increasing use of IP as a source of wealth and as a mechanism for companies to raise and optimize capital.

In the article, Capital Insights, a publication of Ernst & Young's Transaction Advisory Practice, explores key insights related to how:

Capital Insights on IP Value

Access the full Capital Insights Article

IP transactions will continue to elevate as a source of capital as more firms learn from the example of other companies, for example Alcatel-Lucent using IP to partly secure a US$2.7b refinancing package and large IP-driven transactions including patent sales and patent-centric M&A transactions such as Real Media's US$100m+ patent sale to Intel, AOL's $US$1b+ patent sale to Microsoft, or Google's US$12.5b acquisition of Motorola Mobility.

In addition to identifying three common valuation methods, the article describes five common methods used to generate cash through IP monetization: sale, license, litigation, corporate 'separation', and security for a loan. Each method has a unique risk and timing profile, one which IPVision routinely assists clients in evaluating during IP strategy support and portfolio assessments.

The article concludes with the telling perspective from Simon Pearson of Ernst & Young that "it's often difficult for a business to demonstrate the value of its IP to others when it's trying to make an informed decision... an external perspective can help you form an objective view about how IP may be valued and exploited." 

IPVision's analytics and evidence-based IP portfolio assessments are a proven method to assist businesses in this process. 

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Categories: Patent Strategy, Patent Analysis, IP Investment