An innovative start-up that developed an unmanned, offshore oil production system which was designed to enable small pool oil deposits at lower costs than existing technologies. The system was in the pre-prototype stage, and the IP portfolio included product designs, technical specifications, and patent applications. The Company was fundraising to enable the construction of its first production platform.
Like many IP-rich companies looking for investment, there was a disconnect between the Company’s fundraising business valuation and the value reflected on its balance sheet. The lack of tangible assets was clearly an obstacle in securing investment but there was no transparency over the value that had been invested in the Company’s IP. We were engaged to perform an independent assessment of the IP and provided a supporting narrative to help the Company demonstrate how its critical IP underpinned the future revenue streams of the business.
Using our Metisology® process we appraised the extent and quality of the critical IP assets and performed a thorough analysis of Management’s assumptions in order to assess the achievability of the financial forecasts. Our sector research enabled us to assess both the likely competitive advantages that the Company’s IP assets would secure, and the Company’s potential for scalability in the sector. This was important for investors to gain perspective.
In addition to identifying the Company’s core IP, including brand, patents and a trade secret, we recognized a wealth of key organizational knowledge in the form of proof of concepts, product designs, blueprints and technical specifications, which were all critical to the success of the Company’s future operations. Our diligence on the Company’s patent portfolio also identified know-how and related information that was vital to the Company’s services but was not included within any of the patent claims. This was identified as a trade secret and recognized as having significant value within the Company’s IP portfolio.
We provided the Company with an independent IP Valuation which bridged the gap between the Company’s business valuation and its balance sheet, fully narrated the IP assets and explained how these would be leveraged to secure competitive advantage. Our report became a reference point for lender and investor discussions and supported the successful fundraise.
Critical IP Assets Valued – brand, patents, trade secrets and key organizational knowledge
