Informal IP

[numbersrule]

If a process has been identified as patentable, but the business is not ready to apply for the patent yet, is it reasonable to assign a value to the informal pre-patent IP?

 

[Ozzy]

is it reasonable to assign a value to the informal pre-patent IP

Yes.
I have always chosen to not register a patent but my buyers [of my businesses] have always assigned a value to my un-registered IP as have my advisors. The only issue has ever been in the warranties surrounding an unregistered IP in the sale, which I've always been pretty relaxed and happy to sign.

 

[numbersrule]

Thanks Ozzy for your Insight
There may not be a sale of the business until after the Patent and I doubt a warranty could be applied to the process concerned.
However, some additional shares may be issued before the Patent but that may simply be on a totally transparent 'as is' and nominal value basis, so no pressure there.

 

[hazeleigh]

If a process has been identified as patentable, but the business is not ready to apply for the patent yet, is it reasonable to assign a value to the informal pre-patent IP?

• Without formal patent protection, the IP is considered trade secret or know-how. These types of IP can be valuable but require additional protection measures, such as confidentiality agreements (NDAs) or trade secret policies.
• The lack of formal protection may reduce the valuation slightly due to the risk of loss or misappropriation.

 

[numbersrule]

Thank you hazeleigh.

 

[Panoramix IP]

It is common for the majority of the value of a business to reside in unregistered IP such as trade secrets and know how. What is important is your IP story and being able to validate the decisions you have made to date. Many of our tech clients never file patents. That does not mean that there is not significant value in their unregistered IP. You can demonstrate that IP exists by developing a trade secrets register. There are tools such as Intanify that help companies do this.