This article identifies 6 “secrets” for increasing the value of a start-up with intellectual property. I found it interesting that the article is that straightforward in pointing out that IP might be a business’ most valuable asset (in particular in the context of technology start-ups) and that the legal regime governing it might be used very effectively to increase a start-up’s value.
Agreed, IP is incredibly important as it is an asset to the company, not a vague legal matter. VCs look at protectable assets like a person might look at a fixture in a real property situation. It’s fascinating to think that without algorithms or design patents, there would be no such thing as Facebook shares being as sought after as they are.
This article was extremely interesting to me. I expected this convoluted, detailed strategy to increase the value of a start-up company. Instead, I was met with a simple (in theory) step by step way to attach the value of your IP to your company. Another surprising thing was the fact that it seemed business owners are hesitant to speak with IP attorneys to protect their valuable property.
Great article Eliane! It made me think about when Elon Musk announced that Tesla would adopt “an open source philosophy in respect of its intellectual property in order to encourage the development of the industry of electric cars and address the carbon crisis.” [https://www.law.berkeley.edu/files/Tesla_Motors_IP_Open_Innovation_and_the_Carbon_Crisis_-_Matthew_Rimmer.pdf]. I wondered how investors reacted to Tesla announcing that, “Tesla will not initiate patent lawsuits
against anyone who, in good faith, wants to use our technology.” [https://www.law.berkeley.edu/files/Tesla_Motors_IP_Open_Innovation_and_the_Carbon_Crisis_-_Matthew_Rimmer.pdf].
To test this, I used Historic Stock Lookup for Tesla and found the stock values were:
DATE OPEN HIGH LOW CLOSE VOLUME
Jun 10, 2014 204.43 206.97 201.55 202.30 3,519,747
Jun 11, 2014 201.50 205.00 199.25 204.47 3,977,980
Jun 12, 2014 205.10 209.88 202.71 203.52 5,993,829
Jun 13, 2014 204.78 206.79 201.58 206.42 3,545,124
It appears that Tesla’s stock price ended the day of the announcement slightly less than the close of the previous day. However, the next day Tesla’s stock closed at a price higher than it was prior to the announcement. It appears that investors were not concerned that Tesla would no longer be protecting its patents from others wanting to use the technology in good faith.