Intangible Assets In Business Transactions

 Michael D. Moberly     April 14, 2009

Business transactions are no longer (exclusively) shaped by the flow and/or exchange of physical goods and services, e.g., tangible assets. Rather, most business transactions are initiated and evolve around the flow and exchange of intanigble assets, e.g., proprietary, competitive advantage information and intellectual property (IP).

Why is this?, because its an economic fact – business reality that 65+% of most company’s value, sources of revenue, sustainability, and future wealth creation lie in – are directly linked to intangible assets and IP.

Thus, today, when engaging in a transaction in which a significant component of the deals success and profitability literally lie in the ability to sustain control, use, ownership, and value of the intangible assets and IP in play, its important to consider most all transactions through these prisms…

Prism #1 –  mere proof of IP ownership, e.g., patent filings, provisionals, or issuances, are no longer synonomous with (a.) 17-20 years of ‘absolute’ control, use, and value, or (b.) assurances that the holder will receive all of the anticipated economic – competitive advantage benefits…

Prism #2 – it’s prudent to adjust the protection – preservation of a company’s IP and intangible assets to the ’life – value cycle’ of those assets’, not necessarily for the life time of the company…

Prism #3 – ultra-sophisticated and predatorial data mining tools and the winner-take-all global (business-competitor) intelligence operations renders every company’s assets vulnerable to compromise which can readily undermine and/or erode deal success and profitability…

Prism #4 – precursors to disputes and challenges over the control, use, ownership, value, and economic – competitive advantage of a deal’s intangibles and IP must be anticipated and thwarted prior to deal closure (execution) especially those that cause – accelerate (legal) ensnarements and/or entanglements of the assets…

Prism #5 – IT security is not synonymous with information – intangible asset – IP security!


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