When asked about assets, most company managers think of their factories, warehouses, and offices, followed by their cash-on-hand and accounts receivables. But there are other assets – sometimes assets of significant value – that are largely overlooked and, as a result, underutilized.
An enterprise’s Intellectual Property (IP) is clearly an asset, but it is often not an asset that shows up on a balance sheet and has an agreed-to value, like cash-on-hand, receivables, inventory and real estate. An qualified IP consultant can help small and large businesses, universities, and other patent owners determine the value of their patents and other intellectual property, then assist in the development and implementation of a strategy to optimize and monetize those assets.
The reality is that every business, university, and other organization periodically needs an independent analysis of its IP portfolios and assistance in the development and execution of an intellectual assets strategy and IP lifecycle system. By “IP” we mean patents, trademarks, service marks, copyrights, and trade secrets.
Let’s just focus for now on patents. Which patents should be sold? What IP should be licensed? Which may have no value, and so should be abandoned? Finally, what patents or other IP should be acquired that will strengthen your overall IP portfolio? The answers to these questions will shape your organization’s IP strategy.
A comprehensive IP consulting engagement covers several areas:
- IP Strategy Recommendations and Implementation Plans: What are your IP assets worth, and how can they best be managed for an optimal return on investment (ROI)?
- Assessment of IP Assets and Valuation: What is each patent or patent family or patent portfolio worth, which patents should be prioritized, and to what end?
- Implement an Action Plan: What specific actions need to be taken to optimize the value of the enterprise’s IP, who will be responsible for executing the plan, and what should be expected outcome be?
- IP Transaction Services and Support: This can include brokerage (selling, licensing, or other monetization of patents and other IP assets, Patent and/or technology licensing, M&A and equity investment diligence, arbitration/negotiation/alternative dispute resolution, patent search, infringement investigation, and other patent services.
IP Consulting also include addressing IP Lifecycle:
- IP Assessment: This includes analysis and evaluation of IP licensing plans, strategies, organization and resources, and litigation issues looking for over the remaining years of each patent or other IP.
- IP Strategy for the Entire Lifecycle of IP: This starts with a review of the enterprise’s R&D Strategy – past, current, and future – along with coordination and alignment with the enterprise’s IP strategy, as well as a SWOT (Strengths, Weaknesses, Opportunities and Threats) of the overall IP strategy.
- Both Tactical and Strategic IP Strategies: Both short-term (up to two years) and long-term (three years out to ten years) IP strategies need to be examined, including patents, trade secrets, technologies, know-how, or other IP assets. Protective, offensive and defensive strategies need to be examined and implemented. The overall goal is the most efficient possible management and the greatest return on investment (ROI) for the enterprise’s IP portfolio.
Improving the return on investment (ROI) of the enterprise’s IP portfolio is the ultimate objective:
From cost center to profit center: The enterprise’s investment in IP should be an asset that produces revenue for the organization at the same rate – or greater – than other corporate assets.
- Recommend/develop IP Action plans: What exactly is needed in terms of personnel, resources, and support to implement an IP management system.
- Patent invention strategy: Where should the innovators in the enterprise to directed for the next generation of new technologies and patented inventions.
- A transaction monetization plan must be developed and implemented.
- For some enterprises, a patent acquisition plan may be needed for defensive and offensive purposes.
- How will non-core patents be sold – directly or via a patent broker.
- What will the patent and technology licensing plan be going florward.
- What additional actions need to be taken and what implementation plans need to be established throughout the organization.
An IP consultant works with businesses, universities, and other organizations that need an independent analysis of their patent portfolios and assistance in the development and execution of an IP strategy. Which patents should be sold? What IP should be licensed? Which may have no value, and so should be abandoned? Finally, what patents or other IP should be acquired that will strengthen your overall IP portfolio? The answers to these questions will shape your organization’s IP strategy.
If your organization owns over 100 patents, you need to seek assistance from a qualified professional to initially put value on your IP assets, and then develop and execute an IP strategy that will help your organization optimize those assets.
Alec Schibanoff is vice president of IPOfferings LLC, a leading patent broker firm and provider of IP consulting and patent valuation services.
