What is a Context-Based Patent Valuation?

Envision IP employs quantitative and qualitative methods for valuing patent assets. Patent portfolio valuations can be useful in a variety of contexts, such as for a potential patent sale, enforcement action, or financing.  While we typically prefer to conduct valuations based on discounted cash flow models, we can also employ comparable deal and cost-basis valuations, depending on the valuation scenario. Our patent portfolio valuations are tailored toward patent owners, prospective patent buyers, and financial entities involved with IP-backed lending, financing, and investing.

When is a Patent Portfolio Valuation Useful?

• To determine licensing terms or a sale price for an intangible asset transaction.
• To understand the percentage of a company’s overall valuation tied to its patent portfolio.
• To estimate a future performance of a company’s stock price and/or financials based on prior revenue generated by the company’s patent portfolio (via licensing, sales, and litigation).

Why Envision IP?

Envision IP provides clients variable valuation models with sensitivity analysis so they can understand the effects of adjustment factors, such as litigation outcomes, future licensing variations, and changes in market adoption rates.  Our process involves in-depth market research to determine current licensing and royalty revenues for valuation purposes. 

When possible, we base our valuations on a financial model, where patent-related revenue can be directly tied to licensing, litigation-related awards, or technology commercialization. This allows our valuations to be justified using concrete figures, and not by vague metrics that rely on claim word counts, classification codes, or citations.