[1] Intellectual property derives its value from a wide range of parameters such as usefulness, market share, barriers to entry, legal protection, profitability, industrial and economic factors, growth projections, remaining economic life, and new technologies, all of which will inhere in the valuation.
For an IP asset to have a quantifiable value it should:[2][3] An IP valuation - or economic appraisal - is prepared, for example, for transactions, merger and acquisition, pricing and strategic purposes, financing securitization and collateralization, tax planning and compliance, and litigation support.
Finally, the information is devoted to be turned into financial models to estimate the fundamental value of a particular type of intellectual property based on such adapted International Valuation Standards.
The valuation process necessitates gathering much more information as well as in-depth understanding of economy, industry, and specific business that directly affect the value of the intellectual property.
The most common approaches to estimate the fundamental or fair value of the intellectual property are defined as the following:[2][1] Regardless of the method used, the valuation process requires gathering much information about the IP asset, as well as an in-depth understanding of the economy, industry, and specific business that directly affect its value.