Opportunities And Challenges In IP Valuation Services

Stephen Stolfi,

The shift towards a global, digital economy has resulted in the demise of some of the traditional assumptions about measuring the value of a business. Globalization, coupled with a fast-emerging digital economy geared towards service and technology markets, has accelerated this change even faster. It has resulted in the emergence of many important companies whose value no longer solely resides in tangible, physical assets.

The automotive company Tesla is a prime example of this shift. Although the company’s value would historically have resided in its product and production facilities, the company’s technology and IP is recognized as an essential asset. Companies, such as Tesla, find that their investment in intellectual property (IP) and brand strength is vital to growth and valuation. Consequently, they call on the services of qualified IP practitioners and risk assessment professionals to help them to measure the valuation of IP assets.

Given the intangible nature of IP, it’s often hard to define and more difficult to value than physical assets. Knowing exactly how much value a unique trademark adds to goods or services is hard to quantify. As such, reliable solutions for IP valuation are essential to help service providers and companies engaged in intellectual property transactions to utilize the best IP valuation methods and get accurate results.

This article provides a short overview of the opportunities and challenges in IP asset valuation for IP professionals today and showcases a new, innovative solution that enables comprehensive, reliable trademark valuation, helps to optimize best practices for trademark valuation experts, and fosters compliance with global regulations in this fast-growing industry.

How much are trademarks worth? We may be able to help you find that out.

Challenges of IP valuation

The value of an IP asset represents the potential future economic benefits to the authorized user or the IP owner. Unless the value of the intellectual property is assessed, the company’s balance sheet will only reflect the investment that has been made in the creation of the IP, and as a result, the company and its products may be undervalued. If trademark value is at stake, it can be a significant issue.

The cost of intellectual property litigation and dispute resolution can be high. In certain cases, the high stakes of intellectual property litigation can even present a threat to the company itself.

Deciding upon the best intellectual property valuation method to use can present many challenges. Availability of data, the type of IP being valued, and the overall business structure can all play a role in determining which method is the most reliable for service providers.

The value of an asset, whether tangible or intangible, is estimated. Value is primarily derived from its ability to exclude competitors from a particular market. While the legal right grants exclusivity (or the right to exclude), the economic right is based on exclusivity of use — that is, the ability to control use of the IP asset.

Value can be derived from an IP asset in several ways, which include:

  • Direct exploitation of the intellectual property.
  • Sale or licensing of the IP.
  • By owning it (for example IP ownership enables you to raise barriers to your competition and minimize the threat of substitute goods or services).

Opportunities for IP valuation experts

Many brand valuation service providers now utilize technology to assist them in making comprehensive assessments of a company's IP portfolio — and to report their findings and opinion to their company or clients.

TrademarkNow, a Corsearch company, offers an AI-powered solution called Portfolio Analyzer™. This product is a unique business intelligence and trademark management solution that enables trademark and risk management professionals to search for companies and brand names quickly. On one easy-to-use platform, it is possible to create and verify a company trademark portfolio and get essential trademark data for valuation or for strategic-planning purposes.

Access to the platform can be shared amongst cross-functional teams, enabling seamless collaboration between trademark attorneys, M&A teams, and risk assessment and insurance professionals. Reports can be customized and exported to share with clients and teams.

Portfolio Analyzer™ — Intelligent technology for trademark valuation experts

How does it work?

With data from over 180 trademark registries consolidated together, viewing and visualizing any company’s trademark registration portfolio has never been more straightforward. Just enter your company’s name(s) and/or countries and select those whose subsidiaries and brands you’d like to include in your analysis. Names in non-Latin alphabets are automatically translated.

Artboard 1-1

Artboard 2-1

Data retrieved by TrademarkNow’s Portfolio Analyzer™

Portfolio Analyzer™ enables you to gauge the strength of a trademark portfolio, identify growth trends, coverage gaps, and vulnerable brands. It is also possible to benchmark portfolio-strength metrics against competitors.

Artboard 3

Data retrieved by TrademarkNow’s Portfolio Analyzer™

What are the benefits?

Portfolio Analyzer™ puts any trademark portfolio in perspective for you and compares it to those of other industry leaders. It’s algorithm automatically identifies the most relevant and dominant companies in your industry by analyzing the product descriptions of all trademark applications.

This allows unique insight into the trademark portfolio strategies of companies at the top of your industry — and can lend insights into valuations — as well as allowing you to formulate your own strategies for success.

For M&A professionals, Portfolio Analyzer™ is not only useful when conducting an IP audit of a target company. The tool can also help you to identify potential targets and successfully build a brand strategy after a merger or acquisition.

Final thoughts

For IP valuation firms and professionals, performing accurate trademark valuations today is more challenging than ever before. Portfolio Analyzer™ helps you to find, analyze, and present information in a way which better informs a trademark valuation and can significantly reduce the risk of disputes (or penalties) associated with brand valuations.

Find out how Portfolio Analyzer™ can transform your trademark valuation work today!

QUICKLY CREATE AND VERIFY ANY PORTFOLIO- LEARN MORE ABOUT PORTFOLIO ANALYZER

DISCLAIMER

*The above noted third party trademarks are not affiliated with or owned by TrademarkNow, a Corsearch company, and are used for illustrative purposes only as public record from the respective Trademark Offices.

By Stephen Stolfi
Stephen Stolfi a member of the Corsearch Executive Leadership Team. He has been with Corsearch for over 20 years and has worked in the brand clearance and protection solutions industry for close to 30 years. Throughout his career, Stephen has guided and trained numerous individuals at corporations and law firms on effective trademark search and brand protection strategies. He has also guest lectured on trademark clearance and protection at various colleges and universities throughout the U.S., as well as at local and global intellectual property associations. He has written a number of articles and has been quoted about brands in various industry publications and industry blogs. Stephen is Corsearch's Chief Commercial Officer.