Methods for Intellectual Property Valuation

Abstract

Intellectual property (IP) assets are an integral part of the wealth of an organization having an independent identity, economic life, and value. The process of determining the value of an IP asset is known as IP valuation which may vary depending upon various factors such as the nature, economic life, risk, marketability, and the purpose of valuation of IP asset, etc. Various traditional and modern methods are available for the valuation of IP assets but selecting the appropriate method is important to get an adequate value of the subject IP asset. The answer to the question ‘how to valuate an IP asset’ depends upon the answers to various further questions like ‘what to valuate’, ‘when to valuate’, and ‘why undertake a valuation of subject IP asset’. In this chapter, the authors have discussed about the various traditional and modern methods available for the valuation of IP assets which will help the readers in understanding the most suitable method which can be adopted for the valuation of the subject IP asset in varied circumstances and the means to ascertain the most appropriate value of the IP asset.