Intellectual Asset Funding

 

Jane Lambert

Intellectual assets are the creations of the mind that give a business a competitive advantage over all others.  Examples include inventions, computer programs and goodwill.  They are not to be confused with intellectual property such as patents, copyrights and trade marks which protect them.

For many businesses, intellectual assets are their most valuable property.  However, their value has not always been appreciated.  Recently, lenders such as the NatWest Group have begun to accept intellectual assets as security for advances.  For instance, the NatWest Group teamed up with Inngot Limited to launch an IP-based lending proposition for high-growth businesses (see NatWest launches Intellectual Property-based lending to fuel high growth businesses 12 Jan 2024, NatWest website).

Following the former Chancellor's Mansion House speech, the British Business Bank announced a £6.5bn uplift to the Growth Guarantee Scheme to unlock further lending to smaller businesses over the next four years and up to £500m of ENABLE Guarantee capacity ringfenced over the next 12 months to support Intellectual Property-rich smaller businesses (see British Business Bank welcomes Chancellor of the Exchequer’s announcement of package of new measures to support smaller businesses 12 July 2026).

In that press release, the British Business Bank observes that many innovative businesses have significant value in intellectual property but lack the physical collateral that lenders traditionally rely on, which makes it difficult and prohibitively expensive to access debt finance.  Recognising this, the British Business Bank is making up to £500m of existing funding capacity available over an initial 12-month period to support lending to IP-rich smaller businesses. That is expected to help increase the availability of finance for IP-rich businesses, enable more competitive pricing and develop stronger lender capability to assess IP-driven business models.

The value of intellectual property rests ultimately in its ability to prevent unfair competition and resist applications for revocation and invalidation.  These matters are decided ultimately in the courtroom.  The persons best placed to advise on the likely outcome of infringement and invalidity proceedings are the advocates who would have to argue those points before judges and hearing officers.

Anyone wishing to discuss this article may call me on +44 (0)20 7404 5252 during office hours or send me a message through my contact form at any time.

Selling your Invention

 

Jane Lambert

The European IP Helpdesk has recently published a fact sheet on intellectual property assignments entitled Commercialising Intellectual Property: Assignment Agreements which can be downloaded from the EU Publication Office.  I mention it because the European Patent Office's Inventors' Handbook suggests an outright sale of a patent, patent application or other intellectual property right as a possible way in which an inventor can exploit his or her invention.

In my experience, it is rare for inventors who are not employed by companies in research and development or universities in academic research to assign their inventions to a business that is established in the industry for which the invention was created.  As I explained in How to Make Money from your Invention: Licensing on 15 Sept 2017, it is hard enough to find a business that is prepared to take a licence.  Most are even more reluctant to carry out due diligence and pay a lump sum to an inventor from outside their industry.

It is much more likely that a business that has developed an article that does not fit in its product range or a process that it is unlikely to use may offer its invention to others.  In the United States, there are established online and physical marketplaces for the sale of intellectual rights.  That is not yet the case here though there are businesses like Inngot Limited which will prepare an intellectual asset for sale.

Both potential purchasers and vendors should take legal and tax advice before embarking on negotiations,  The vendor should satisfy itself that it will never need to use the invention or the work leading up to its creation again.  If that is not the case it will need to negotiate licences.  The purchaser should satisfy itself that the vendor is entitled to sell the invention, that its use will not infringe other parties' patents or other intellectual property rights and that the patent, patent application or other legal protection is sufficient,   A mechanism for valuing the intellectual asset will have to be agreed.   In the UK and most other countries, the assignment must be in writing and signed by all parties.  The assignment should also be recorded at the intellectual property office of every relevant country.

Anyone wishing to discuss this article may call me on 020 7404 5252 during office hours or send me a message through my contact page, 

Taking your Ideas to Market in Wales

The Atrium of the Menai Science Park

© 2019 Jane Lambert: all rights reserved

 

Jane Lambert

Yesterday I chaired a webinar organized by the Menai Science Park entitled IP and SME, Taking your Ideas to Market in Wales (see Menai Science Park's Contribution to World IP Day 2021 25 April 2021 NIPC Wales).  I have been taking part in events like that for some 20 years but yesterday's was the best ever.  The seminar covered a lot of topics in 100 minutes but there are two important takeaways.  One is that Wales provides support to new businesses that is no longer available in England.  The other is that Inngot Limited provides a range of tools for valuing intellectual assets even when those assets are at an early stage of development.

One of the big differences between business support in Wales and England is that the Welsh government continues to support business centrally through an agency called Business Wales.   Business Wales describes itself as

"a free service that provides impartial, independent support and advice to people starting, running and growing a business in Wales. With regional centres across Wales, we offer a mixture of online and face-to-face support, as well as training workshops and individual advice."

To English eyes, that seems to be very much the sort of thing that the regional development agencies and Business Link did before their abolition and replacement by local enterprise partnerships.  

Yesterday we heard a presentation by David Wooldridge who is the Intellectual Property Manager of the Welsh Goverbment['s Innovation Team in Swansea.  According to Business Wales's Funding page, 

"Funding is available for all phases of a research and development, from initial feasibility to market exploitation:

• Technical and Commercial Feasibility - help to assess whether your idea is technically and commercially viable.
• Industrial Research - help for practical research and to develop basic working models.
• Experimental Development - use the results of the industrial research to produce a pre-production prototype.
• Exploitation - help with the costs of launching your new product/process on the market."

These include innovation vouchers to

• "fund capital equipment that supports a technology step-change
• bring in technical consultancy expertise from the private sector
• work with universities and colleges to help solve technical problems
• improve processes in design and manufacturing
• access expertise services for intellectual property (IP) registration."

A service that appears to support new businesses is Expertise Wales which describes itself as 

"The online resource for driving collaboration and innovation in Wales."

One of Expertise Wales's services is SMARTCymru.  Another is the Small Business Research Initiative.  There appear to be many more.   I am indebted to Richard Fraser-Williams, Growth Relationship Manager at Business Wales for putting me in touch with David Wooldridge.

Richard also told me that many entrepreneurs require a guide to navigate the various funding schemes and he referred me to BIC Innovation.   It is a company that I have known for many years and with which I have collaborated.    Mark McGowan of BIC Innovation explained how he and his colleagues assisted businesses to seek funding not only from the Welsh government but also from business angels and venture capitalists.  Businesses that are not already in Wales would be very well advised to consult someone like Mark before opening up there.

Like the Welsh Government's Innovation Team. Inngot is based in Swansea.  One of its founders is Iwan Davies who held the Sir Julian Hodge Chair of Law at Swansea University and is now Vice-Chancellor at Bangor.  He is a distinguished academic lawyer with expertise in both asset finance and intellectual property.  For several years, Swansea law school hosted the IP Wales/ED Cymru website which was an excellent resource on intellectual property law.  Yesterday's presentation on IP valuation was given by Alison Orr who is Inngot's Business Development Manager.   According to Inngot's website

"Alison leads many of Inngot’s IP audits and technology evaluations, and provides her expertise to clients requiring training and coaching on IP, assistance with technology scouting, and help exploiting their IP in international markets. She has also helped shape Inngot’s intangible asset identification tools."

 Alison introduced her audience to Inngot'ss services and focused on the valuation of intellectual assets of startups and other small companies.  Obtaining such a valuation right at the start could avid a lot of the personal tragedies that I have witnessed in my career at the bar.   It could also assist a business to obtain the right sort of funding and thus secure its future.   It goes without saying that Inngot offers its services to entrepreneurs, business owners and investors everywhere and not just in Wales.  

Any business not already in Wales that is contemplating a move or expansion there would do well to consider the Menai Science Park or at least the immediate area because the park already hosts a lot of experts.  BIC Innovation is there as is Andrea Knox of Knox Commercial Solicitors and Steve Livingston of IP Tax Solutions.  Both gave excellent presentations yesterday.   Like Alison and Mark, they can be consulted by anyone anywhere and they are also first-class professional advisors.

Anyone thinking of doing business in Wales should find useful material on my IP Wales website at www.nipcwales.co.uk.  Contact me on +44 (0)20 7404 5252 or through my contact page if you want to discuss this article or any of the matters mentioned in it

http://www.nipcwales.co.uk