Patent valuation: a building block for success
The EPO President, Mr. Benoît Battistelli, has recently highlighted in his blog that, over the past decade, the valuation and monetisation of intellectual property (IP) have become extremely important for a knowledge-based economy. In the past, the approach to IP valuation was mainly defensive, when liquidity problems led companies to look for things they could readily sell. However, latterly the management of patent portfolios has become increasingly dynamic with the use of licensing and mortgages, as IP owners come to realise the dormant potential of patented technology.
In this sense, Mr. Battistelli’s wrote: “a recent conference gave me the opportunity to present the ain features of the patent system to an audience of fund managers and bank representatives wanting to know more about IP in general and patents in particular. The topic attracted a great deal of interest. While patents are not a guarantee of economic success, they can be a very useful indicator of a company’s potential value. This applies in particular to SMEs, and all the more so to start-ups, which often lack tangible assets to secure a loan request”. A recent study commissioned by the UK IP Office draws some very interesting conclusions about the huge benefits that remain untapped in this field, mainly because of the lack of information and understanding between the worlds of IP and finance.
Even though a patent office has no role in assessing the economic potential of a patent or patent application, by improving the quality of the granted patent a patent office can certainly help right-holders to build trust in the soundness of their intellectual property and thereby to obtain financing. The patent offices also provide access to a vas stock of data that can be used for valuation or for macroeconomic research, as pointed out by a study recently conducted by EPO and OHIM on the economic impact of IP in the EU.
In recent years, European governments have repeatedly insisted on the importance of building an innovation-friendly environment in our knowledge-based economy. To this end, IP valuation is an area offering scope for real progress.