In his book titled From Ideas to Assets, which will be released on Jan. 10, intellectual property analyst and consultant Bruce Berman, of Brody Berman Associates, compiles a collection of essays and theories on the valuation of IP, including substantial research on both potential and already utilized securitization technology in the field.
Notably, the book contains contributed works from familiar IP securitization gurus such as Jay Eisbruck of Moody's Investors Service, and Bernhard Fischer of Standards & Poor's
"Company executives, and Wall Street know that patents are very important, and play a critical role in the value and growth in companies," Berman said. "However, they're not quite sure how to go about maximizing the hidden value of patents and other IP assets."
Meanwhile, a firm said to be at the forefront of developing new types of IP financings and potential securitizations is Licent Capital, which is led by Chief Executive Officer Jack Ross, who, back in the 1980s, was a founding member and former group head of Merrill Lynch's asset-backed group.
Ross endorses From Ideas to Assets, while a managing director at Licent, Joseph Agiato, contributes a piece on the fundamentals of royalty financing.
Interestingly, Berman replicates an IP securitization deal list that was compiled by ASR and originally appeared in the Intellectual Property Special Issue (11/27/00), sourcing Thomson Financial.
Separately, according to industry professionals, changing accounting rules and pressure for companies to better value themselves is also pressuring corporations to more accurately depict the value of intangible assets and intellectual property, both in terms of M&A activity and for stockholder benefit.
"I think that accountants are continually trying to look for ways to account for these assets, and that's happening throughout the industry," said a source familiar with the developments.
For example, a company might be challenged to place a present value on a customer list, which might be key to running a business, yet does not have a market value.
"Anything that encourages the valuing of intangible, particularly IP assets, will have a net positive effect for securitization," Berman said.