INTELLECTUAL PROPERTY VALUATION; WHY IT IS A VALUE-ADDING FRONTIER TO TAP INTO

By John Syekei Friday, March 08, 2019
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In an increasingly competitive and high-risk business environment, organisations that make the most of their Intellectual Property (IP) can gain a valuable competitive advantage. The benefits can be diluted, however, if there are gaps in companies’ knowledge about how to extract value from their IP.

IP valuation is a responsive service to help companies unlock previously hidden value in intangible assets. Intangible assets are progressively being recognised as just as valuable as tangible assets. There is a growing need and demand for IP valuations, which provide an estimate of what an enterprise’s IP may be worth.

More than any other tool, perhaps, an IP valuation can reveal the substantial unseen worth of IP and aid companies to use that insight to inform commercial strategies and decisions.

When it comes to methodology, there are three key techniques used in IP valuation: the market approach, the income approach and the cost approach. The valuations conducted are uniquely tailored to the commercial needs and opportunities available to an organisation. An IP valuation would typically begin with an audit to determine the nature of IP assets that a business may have; this would be in the form of a due diligence carried out on the business. In this way, the IP valuation approach exhausts the scope and unlocks the depth of value present in intangible assets.

Ultimately, IP valuations improve IP strategy and management for organisations, contributing to their overall productivity and profitability.