The IP Exploitation Strategy

There are several strategies to exploit the Intellectual Property. The owner can directly commercialize the IP or the IP can be licensed to other entities in exchange for receiving an economic return, usually in the form of royalties or royalties plus a fixed fee.  

Although the previously mentioned models are the most commonly known, there are other strategies to exploit the asset, always accompany the business model. Models such as the creation of a start-up or the creation of a joint venture with a manufacturer, a commercial partner or an strategic alliance with other entities are also interesting options to consider.

Any of the exploitation models can require the license of the IP to a third party. In this case, the owner provides access right to third parties, for the use and exploitation of the IP, for a limited period of time and perhaps for an specific use and under determine conditions, such as the commercialization in specific sectors and/or countries.

Despite the selected exploitation model does not consider the license at a first stage, sometimes it is necessary to use this mechanism to manufacture or commercialize the asset or for the use of know-how, by our suppliers or sellers. The licensing model is widely use by the software companies, providing a license to customers for the use of the software or online application.  

On the other hand, if the owner is willing to sell the IP,  the ownership rights are transferred to a third party, having the seller no rights to use or exploit the IP unless it is stated in the selling contract.

Whether the strategy is to transfer or license the IP, it is important to previously perform an assessment to understand the value of the assets, decide the better strategy to exploit it,  considering specific clauses in the commercialization contract if needed and accounting it economically.

There are several aspects when assessing the Intellectual Property. It can be assessed from the technical perspective, defining what the IP is, what it is applicable for and its value compared to the state-of-the art. Secondly, the assessment addressing the market opportunity, identifying the applicable direct market, other potential applicable markets, the markets volume, trends and dynamics, the market key players and the competitors, including in the assessment both, the products already in the market and solutions under development. During this phase, talking to the key market players and potential customers provides insights to better understand the market dynamics. From the exploitation perspective, it is worth to work on the strategy, reflecting about how to earn money, how can I differentiate from others, what is my business model, should I protect my IP, how and where. Economically, there are several methods to valorize the assets, this is crucial when transferring or licensing the technology to others. Simultaneously, a legal assessment must be considered for the management of the IP protection, upon the commercialization of the assets for the contracts management and the agreements negotiation between the parties.