We value intellectual property for sales and acquisitions, licensing, intra-group transfers, financing, insolvency and disputes, working with IP owners, their lawyers and their accountants.
When is this valuation required?
- IP is being sold, assigned or transferred between group companies.
- A licence agreement needs a royalty rate that can be supported.
- IP is being contributed to a joint venture or used as security for finance.
- IP needs to be valued as part of an acquisition, restructuring or insolvency.
- The value of IP, or damage to it, is in dispute.
Who instructs us?
- IP owners and technology companies
- IP and commercial solicitors
- Accountants and tax advisers
- Insolvency practitioners and lenders
What exactly is valued?
We value registered rights such as trademarks and patents, unregistered rights such as copyright and know-how, and bundles of rights such as software platforms or brands. Where IP is closely tied to other assets, we define the boundaries of what is being valued before any method is applied.
How is value assessed?
Relief-from-royalty is widely used for trademarks, technology and copyright, supported by evidence of royalty rates in comparable licences and an analysis of the profits the IP supports. Excess earnings methods suit IP that drives most of a business's value. Cost-based approaches are relevant where income cannot be isolated, for example for internally used software.
The remaining legal life of a right, the strength of its protection and the risk of technological or market change all influence the forecast period and the discount rate.
How the approaches are usually weighed
Typical
- IncomeRelief-from-royalty and excess earningsUsual starting point
- MarketRoyalty rates in comparable licencesCross-check
- CostCost to recreate, such as internal softwareWhere relevant
What factors influence the result?
- Scope of protection
- Registration, territories covered and enforceability.
- Remaining life
- Patent term, technological obsolescence and brand durability.
- Royalty evidence
- Rates in comparable licence agreements, adjusted for differences.
- Commercial exploitation
- Products, markets and revenue that rely on the IP.
- Ownership and encumbrances
- Chain of title, existing licences and security interests.
What information is required?
- Details of the IP rights, registrations and ownership
- Existing licence agreements
- Revenue and margins from products or services using the IP
- Forecasts and product roadmaps
- Development costs and history
We send a tailored information request once the scope is agreed.
What report will you receive?
Reports describe the rights valued, their legal status, the method and evidence used, and the conclusion, with the assumptions on economic life and royalty rates stated clearly.
See types of business valuation reports for how the scope of each type differs.
Timing and cost
How long will it take?
IP valuations depend heavily on the information available about the rights and their use. Single-asset valuations with good data are quicker; portfolios or contested rights take longer.
How much does it cost?
Fees depend on the number and complexity of the rights, the purpose and the depth of royalty and market research required. Confirmed in writing before work starts.
How our fees are set →Frequently asked questions
How is intellectual property valued?
Usually by reference to the income it generates or saves, for example through relief-from-royalty or excess earnings methods, supported where possible by market evidence and, in some cases, cost-based approaches.
How do you value a patent?
By considering the products or licensing income it protects, its remaining life, the strength of protection, the risk of being designed around and comparable licence terms.
Can you support a royalty rate?
Yes. We analyse comparable licence agreements and the profit the IP supports to assess an appropriate royalty rate for the purpose.
Do you advise on IP law or registration?
No. Questions of validity, infringement and ownership are for your IP lawyers. We value the rights based on their legal status as advised.
Can you value software?
Yes, including proprietary platforms and internally developed software, using income or cost approaches depending on how the software generates value.
