Method for valuing intellectual property

• US 7,188,069 B2
• Filed: 11/30/2000
• Issued: 03/06/2007
• Est. Priority Date: 11/30/2000
• Status: Expired due to Fees

• Current Assignee: Syracuse University
• Original Assignee: Syracuse University
• Inventors: Hagelin, Theodore
• Primary Examiner(s): Hayes; John W.
• Assistant Examiner(s): NELSON, FREDA ANN
• Application Number:
  US09/726,277
• Publication Number:
  US 20020077835A1
• Time in Patent Office: 2,287 Days
• Field of Search: 705/1, 705/6, 705 7- 8, 705/10, 705/33, 705 35- 38, 705/400
• US Class Current: 705/310
• CPC Class Codes: G06Q 10/0639 Performance analysis of employees; Performance analysis of enterprise or organisation operations
• CPC Class Codes: G06Q 30/02 Marketing; Price estimation or determination; Fundraising
• CPC Class Codes: G06Q 30/0283 Price estimation or determination
• CPC Class Codes: G06Q 50/184 Intellectual property management

Abstract

A method of placing a discrete value on an intellectual property asset through a series of associations and calculations that determine the proportional contribution of an intellectual property asset to the competitive advantage of a related product in a real market. The methodology of the present invention first associates the intellectual property asset with a related tangible asset that embodies the intellectual property asset. After a set of parameters that define the tangible asset are identified, the tangible asset is quantitatively compared to competing tangible assets in the marketplace to determine its overall competitive advantage relative to those competing assets. The contribution of the intellectual property asset to the average competitive advantage of the tangible asset in which it is embodied is calculated by first comparing the intellectual property asset to substitute intellectual property assets that are embodied in competing tangible assets and associated with the same parameter. Next, the intellectual property asset is compared to complementary intellectual property assets that are included in the same tangible asset and associated with the same parameter group. Based upon the proportional competitive advantage contribution of the intellectual property asset to the average competitive advantage of the tangible asset, a percentage of the tangible asset'"'"'s present value is assigned to the intellectual property asset. The present invention can also be used for planning development of pre-market products, calculating the value of a license to a licensor and licensee, and selecting among alternative research and development investments.

Claims

1. A method of valuing an intangible asset using a data processing system, comprising the steps of:

calculating a monetary value of a tangible asset associated with said intangible asset using said data processing system by;

identifying a parameter dependent on said intangible asset and associated with said tangible asset that is relevant to commercial success in a marketplace;

using said data processing system to calculate the relative contribution of said intangible asset to said competitive advantage of said tangible asset;

imputing into said data processing system the contribution of said parameter to said competitive advantage of said tangible asset as compared to related intangible assets; and

using said data processing system to multiply said relative contribution of said intangible asset with said value of said tangible asset;

using said data processing system to determine the competitive advantage of said tangible asset over competing tangible assets as a percentage thereof; and

using said data processing system to calculate a value for said intangible asset based upon the relative contribution of said intangible asset to said competitive advantage of said tangible asset; and

displaying said value using said data processing system.

2. The method of claim 1, wherein the step of determining a present monetary value of an intended market for said pre-market product comprises the steps of:

determining a total annual gross sales of said intended market for said pre-market product;

determining an annual growth of said intended market as a percent;

determining a life cycle of said pre-market product in years;

determining a profit margin of said pre-market product as a percent of gross sales;

determining a present value discount factor; and

summing a multiple of said total annual gross sales, said annual growth, said profit margin, and said present value discount factor over each year of said life cycle of said pre-market product.

3. A method of valuing a pre-market product using a data processing system, comprising the steps of:

using said data processing system to determine the present monetary value of an intended market for said pre-market product;

inputting into said data processing system a plurality of parameters of said pre-market product and a plurality of corresponding parameters of competing products in said intended market;

using said data processing system to compare said plurality of parameters of said pre-market product to said plurality of corresponding parameters of competing products in said intended market and determine a competitive advantage for each said parameter of said pre-market product as a percent variation;

inputting weights for each said competitive advantage of each said parameters into said data processing system and averaging said competitive advantages of the parameters in said data processing system to determine said competitive advantage of said pre-market product in said market;

predicting a market share of said pre-market product based on said competitive advantage calculated by said data processing system; and

using said data processing system to calculate a monetary value for said pre-market product by multiplying said predicted market share and said present monetary value of said intended market; and

displaying said monetary value using said data processing system.

4. The method of claim 3, wherein the step of predicting a market share of said pre-market product based on said competitive advantage comprises the steps of:

determining an average market share of said market; and

multiplying said average market share by said competitive advantage.

5. A method-of determining the monetary value of a new intangible asset in a data processing system, comprising the steps of:

using said data processing system to calculate a change in a competitive advantage of a tangible asset associated with said new intangible asset as a percent variation by

identifying at least one parameter associated with said tangible asset relevant to commercial success in the marketplace;

using said data processing system to compare said parameter with at least one parameter of at least one competing tangible asset to determine said competitive advantage said tangible asset as a percent variation;

using said data processing system to calculate a competitive advantage for said tangible asset without said new intangible asset as a percent variation;

using said data processing system to calculate a competitive advantage for said tangible asset with said new intangible asset as a percent variation; and

using said data processing system to subtract said competitive advantage for said tangible asset without said new intangible asset from said competitive advantage for said tangible asset with said new intangible asset to determine the monetary value, and

displaying the monetary value using said data processing system.

6. The method of claim 5, wherein the step of calculating said monetary value by multiplying said change in said competitive advantage of said tangible asset and an average market share in an intended market comprises the steps of:

using said data processing system to calculate a present monetary value of said intended market for said tangible asset;

using said data processing system to calculate said average market share in said intended market as a percent;

using said data processing system to determine an average product present monetary value by multiplying said present monetary value of said intended market by said average market share;

using said data processing system to multiply said average product present monetary value and said change in said competitive advantage.

7. A method of valuing an intangible asset using a data processing system, comprising the steps of:

associating said intangible asset with a tangible asset;

inputting into said data processing system a total annual gross sales in a market for said tangible asset;

inputting into said data processing system an annual percent growth of the market;

inputting into said data processing system a life cycle in years of said tangible asset;

inputting into said data processing system a profit margin of said tangible asset as a percent of gross sales;

inputting into said data processing system a present value discount factor;

using said data processing system to sum a multiple of said total annual gross sales, said annual percent growth, said profit margin, and said present value discount factor over each year of said life cycle of said tangible asset;

identifying at least one parameter associated with said tangible asset relevant to commercial success in the market;

using said data processing system to compare said parameter with at least one parameter of at least one competing tangible asset to determine a competitive advantage of said tangible asset as a percent variation;

identifying a parameter dependent on said intangible asset and associated with said tangible asset that is relevant to commercial success in the market;

using said data processing system to calculate said relative contribution of said intangible asset to said competitive advantage of said tangible asset based on a contribution of said parameter to said competitive advantage of said tangible asset; and

using said data processing system to multiply said relative contribution of said intangible asset with said value of said tangible asset to determine the value of said intangible asset, and

displaying said value of said intangible asset using said data processing system.

8. A method of valuing a pre-market product using a computer program, comprising the steps of:

inputting into said data processing system a total annual gross sales of an intended market for said pre-market product;

inputting into said data processing system an annual growth of said intended market as a percent;

inputting into said data processing system a life cycle of said pre-market product in years;

inputting into said data processing system a profit margin of said pre-market product as a percent of gross sales;

inputting into said data processing system a present value discount factor;

using said data processing system to sum a multiple of said total annual gross sales, said annual growth, said profit margin, and said present value discount factor over each year of said life cycle of said pre-market product;

using said data processing system to compare a plurality of parameters of said pre-market product to a plurality of corresponding parameters of competing products in said intended market to determine a competitive advantage for each said parameter of said pre-market product as a percent variation;

inputting weights for each of said plurality of parameters of said pre-market product into said data processing system and then averaging said competitive advantages of the parameters to determine said competitive advantage of said pre-market product in said market;

using said data processing system to determine an average market share of said market;

using said data processing system to multiply said average market share by said competitive advantage; and

using said data processing system to calculate a monetary value for said pre-market product by multiplying said predicted market share and said present monetary value of said intended market, and

displaying said monetary value of said pre-market product using said data processing system.

9. A method of determining the monetary value of an intangible property license between a licensor and a licensee using a data processing system, comprising the steps of:

using said data processing system to calculate an increase in a competitive advantage of said tangible asset as a percent variation due to said intangible asset subject to said license for said licensee;

using said data processing system to calculate a decrease in a competitive advantage of said tangible asset as a percent variation due to said intangible asset subject to said license for said licensor;

using said data processing system to determine a monetary value of said tangible asset by multiplying a monetary value for a market for said tangible asset and an average percent market share in said market;

using said data processing system to determine a minimum monetary value to said licensor by multiplying said percent decrease by said monetary value of said tangible asset;

using said data processing system to determine a maximum monetary value to said licensee by multiplying said percent increase by said monetary value of said tangible asset;

using said data processing system to calculate a net monetary value by subtracting a minimum monetary value to said licensor from a maximum monetary value to said licensee;

using said data processing system to determine an equal return payment that provides an equal return on investment to the licensor and licensee;

calculating said monetary value to the licensor as equal to said equal return payment; and

using said data processing system to calculate said monetary value to the licensee by subtracting said equal return payment from said net value.

10. A method of determining the monetary value of a new intangible asset using a data processing system, comprising the steps of:

identifying at least one parameter associated with said tangible asset relevant to commercial success in the marketplace;

inputting indicia relating to said parameter into said data processing system;

using said data processing system to compare said parameter with at least one parameter of at least one competing tangible asset to determine said competitive advantage said tangible asset as a percent variation;

using said data processing system to calculate a first competitive advantage for said tangible asset without said new intangible asset as a percent variation;

using said data processing system to calculate a second competitive advantage for said tangible asset with said new intangible asset as a percent variation;

using said data processing system to subtract said first competitive advantage for said tangible asset without said new intangible asset from said second competitive advantage for said tangible asset with said new intangible asset;

using said data processing system to calculate a present monetary value of an intended market for said tangible asset;

using said data processing system to calculate an average market share in said intended market as a percent;

using said data processing system to determine an average product present monetary value by multiplying said present monetary value of said intended market by said average market share; and

using said data processing system to multiply said average product present monetary value and said change in said competitive advantage to determine the monetary value of said new intangible asset, and

displaying said value of said new intangible asset using said data processing system.

11. A method of valuing an intangible asset, comprising the steps of:

calculating a monetary value of a tangible asset associated with said intangible asset;

determining a competitive advantage of said tangible asset over competing tangible assets as a percentage thereof;

identifying a parameter dependent on said intangible asset and associated with said tangible asset that is relevant to commercial success in a marketplace;

calculating said relative contribution of said intangible asset to said competitive advantage of said tangible asset based on a contribution of said parameter to said competitive advantage of said tangible asset as compared to related intangible assets; and

multiplying said relative contribution of said intangible asset with said value of said tangible asset to determine a value for said intangible asset based upon a relative contribution of said intangible asset to said competitive advantage of said tangible asset, and

outputting said value of said intangible asset.

12. A method of valuing a pre-market product, comprising the steps of:

determining a present monetary value of an intended market for said pre-market product;

comparing a plurality of parameters of said pre-market product to a plurality of corresponding parameters of competing products in said intended market to determine a competitive advantage for each said parameter of said pre-market product as a percent variation; and

weighing and averaging said competitive advantages of the parameters to determine a competitive advantage of said pre-market product in said market;

predicting a market share of said pre-market product based on said competitive advantage; and

calculating a monetary value for said pre-market product by multiplying said predicted market share and said present monetary value of said intended market, and

outputting said value of said pre-market product.

13. A method of determining the monetary value of a new intangible asset, comprising:

identifying at least one parameter associated with said tangible asset relevant to commercial success in the marketplace;

comparing said parameter with at least one parameter of at least one competing tangible asset to determine said competitive advantage said tangible asset as a percent variation;

calculating a competitive advantage for said tangible asset without said new intangible asset as a percent variation;

calculating a competitive advantage for said tangible asset with said new intangible asset as a percent variation;

subtracting said competitive advantage for said tangible asset without said new intangible asset from said competitive advantage for said tangible asset with said new intangible asset to determine a change in a competitive advantage of a tangible asset associated with said new intangible asset as a percent variation; and

calculating said monetary value by multiplying said change in said competitive advantage of said tangible asset and an average market share in an intended market, and

outputting said value of said intangible asset.