How can Intellectual Property Enhance the Market Value of Your SME?

The value of intellectual property (IP) is often not adequately appreciated and its potential for providing opportunities for future profit is widely underestimated by SMEs. However, when IP is legally protected and there is demand for the IP-protected products and/or services in the marketplace, IP can become a valuable business asset.

  • IP may generate an income for your SME through the licensing, sale, or commercialization of the IP-protected products or services that may significantly improve an enterprise’s market share or raise its profit margins.
  • IP rights can enhance the value or worth of your SME in the eyes of investors and financing institutions.
  • In the event of a sale, merger or acquisition, IP assets may significantly raise the value of your enterprise, and at times may be the primary or only true assets of value.

The strategic utilization of IP assets can, therefore, substantially enhance the competitiveness of your SME. SMEs should make sure that they are ready to face the challenge and take measures to exploit their IP and protect it wherever possible. Like physical assets, IP assets must be acquired and maintained, (see “How can Your SME Acquire and Maintain Intellectual Property Protection”), accounted for, valued, monitored closely, and managed carefully in order to extract their full value (see “Managing the Intellectual Property Assets of Your SME”). But before this can be done, SMEs must first acknowledge the value of IP and begin to see it as a valuable business asset.