IP Finance & Monetization

Commercialisaztion, Industrialisation and Financialisation of Intellectual Property

Monetising IP can involve three separate practices. The starting point is commercialisation, which is defined as treating IP as a tradable commodity and maximising its value in the market. This creates the flexible distribution of IP resources. The term “industrialisation” of IP refers to using IP in a company’s products, services and businesses, and assisting enterprises with upgrading and developing their infrastructure.  The term “financialisation” of IP means that capital is used to encourage innovation, so that financial rewards can be given to investors as enterprises grow rapidly. If IP monetisation is a car journey, commercialisation is the vehicle, industrialisation is the route it takes, and financialisation is the engine that drives it towards popularisation, its destination and the ultimate value of IP.

We have built the car and we are mapping the route, but we have not fine-tuned the engine. Much more needs to be done to develop the financialisation of IP, which can yield significant returns over the long term, as Wall Street and Silicon Valley have shown in the past two decades. Shrewd investors show great enthusiasm for companies with core IP or innovative business models.

Intellectual Property Escrow
Intellectual Property Escrow Intellectual Property Escrow is a relatively new service which may offer an extra measure of security for your IP. Acting essentially as a security guard for your valuable intellectual property, an escrow arrangement is made under contractual provisions between clients and an independent escrow agent, whereby the trusted agent maintains or supports the IP portfolio management on behalf of the clients. These include IP consultation, registration applications, proper use of the IPRs, IP transfer or licensing, IP strategic plans and security collateralization, IP monetization, IP protection & avoiding infringement, etc. on the fulfillment of contractually agreed conditions by the parties.

IP Escrow is used to help firms perform well in their core competencies and mitigate shortage of skill or expertise in their IP management where they can outsource. It not only improves the comprehensive management of their intangible assets, but also reduces capital and operating expenses and the need to hire and train specialized staff. IP Escrow can be classified into ‘Whole Escrow’ and ‘Partial Escrow’. 
Whole Escrow service offers a package of schemes which fully cover the management of all intangible assets of the clients, whilst Partial Escrow is suggested to address the fulfilment of IP protection case by case according to clients’ periodic needs. The biggest difference between IP Escrow and traditional IP Management Contract lies in the fact that IP Escrow emphasizes particularly on developing IP strategic plans, IP regime, execution initiatives that fit in with the clients’ needs, collecting and providing the information on intangibles change in value so as to unleashing at the utmost the hidden financial potential of their intangible assets.