Patent financial valuation

Patent financial valuation

Finantis Value has the technical, marketing and financial expertises to perform a complete patent portfolio analysis, whether the patents are delivered or not. We also work in collaboration with IP attorneys when additional legal expertise is needed.

The patent is an intangible asset that often plays a key role in a company’s business.

Its value depends on the income it generates or is likely to generate in the future, but also on :

  • its legal (IP) characteristics (quality of protection),
  • its technical aspects (what exactly the patent protects and the technical relevance of the solution)
  • and the parameters that directly impact revenue:
    • the positioning and approach of the market,
    • the business model and profitability of the business model implemented.

 

The financial valuation of a patent or patent portfolio is necessary or recommended in several situations:

  • Capital operations, predictable entry of investors or associates
  • Public or private fundraising
  • Search for partners
  • Acquisition or transfer of patents or companies holding patents
  • Internal, organizational or capital restructuring
  • PPA: purchase price allocation
  • litigation and prejudice
  • fiscal context

 

Different valuation methods exist (based on costs, comparable market data or future revenues). Their choice is made according to the context of the financial valuation, the characteristics of the patent, but also the available information.

The methods employed are generally based on the economic analysis of the role of the patent and a prospective analysis of the added value provided by the patent.

If a patent did not generate any income, it does not mean that it is worthless. Beyond the investments made, a further study of its operating potential will be necessary.

 

DELIVERABLE

At the end of our mission, our clients receive a strategic report detailing the points we analyzed, the methods we used and our quantified conclusions.

Depending on the context, we are also led to make certain recommendations or reservations likely to influence the estimates made.

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