Opportunity Assessment & Potential Licensing Partners

Transcription

1 Opportunity Assessment & Potential Licensing Partners Stanford OTL/iFARM PROGRAM Efrat Kasznik, Founder & President Foresight Valuation Group, LLC Foresight Valuation Group 2016 Palo Alto, CA (650) October 4th,

2 About Me: Efrat Kasznik Founder and President, Foresight Valuation Group, a Silicon-Valley based IP valuation, strategy and start-up advisory firm. IP valuation and strategy expert, with over 20 years of experience Lecturer on IP Strategy, Stanford Grad. School of Business (GSB); Mentor, GSB Center for Entrepreneurial Studies Chair, Internet of Things (IoT) Committee, Licensing Executives Society (LES USA-Canada); Secretary, High Tech Sector of LES Listed on IAM 300 list of World IP strategists: Co-founder and adviser to startups, incubators and venture funds in the US, Israel and Europe Conference speaker and regular contributor to IP and Business publications. 2

3 Foresight s Services Valuation Analysis We offer a full range of intellectual property and business valuation services ranging from financial & tax reporting compliance to situations related to IP transactions, technology licensing, and R&D planning Economic Studies We provide advanced economic studies utilizing return on investment (ROI) and customer utility metrics to quantify the impact of new products and technologies Litigation Damages We provide customized damages opinions and litigation support services through our network of experienced damages and technical experts, on matters related to commercial intellectual property disputes. Strategic Consulting We advise senior management on the alignment of their IP portfolios with their business strategy and effective monetization of their intangible assets. Startup Advisory We help new ventures create a strategic roadmap for their business, develop their financial modeling, and support their IP strategy. 3

4 Foresight Client List: IP Services * *Cases based on work done by our partners & affiliates over past 20 years 4

5 Ant-Size Radio Announced by Stanford 5

6 What Can We Learn from the Ant-Size Radio Announcement? Clear Communication of Value Proposition: vcatchy phrases: Ant-Size Radio, Connect the World vwhat is does (in functional terms, not scientific terms) vevidence that it actually works (video)! vkey attributes: low cost, small size, low energy, addresses a key problem in a huge market vwhat can is be used for: power the IoT vuse cases: examples in the story, video vseeing the actual inventor describe it vcontact information clear for follow up 6

7 Outline ü Open Innovation Framework q IP Monetization Models q Make v. Buy Decision q Commercialization Assessment q Licensee Outreach q Key Takeaways 7

8 Corporate IP Strategy: Throughout the Lifecycle 8

9 The Open Innovation Paradigm What is open innovation? Open innovation is a paradigm that assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as the firms look to advance their technology - Henry Chesbrough, Center for Open Innovation at the University of California, Berkeley 9 Chesborugh

10 Technology Transfer & Open Innovation Tech Transfer Internal R&D Manufacturing Marketing Sources of outside IP/technology/Innovation: In-licensing: companies, universities, individual inventors) Buying companies: start-ups, competitors Buying patents: for enforcement, freedom to operate Crowdsourcing: posting challenges online 10

11 Outline q Open Innovation Framework ü IP Monetization Models q Make v. Buy Decision q Commercialization Assessment q Licensee Outreach q Key Takeaways 11

12 Intellectual Property Monetization Models Use in Own Products Out/Cross License Sale Joint Venture/ Spin Off Enforcement One way (out-license, in-license) Two ways (cross license) Active market for patents in the US Buyers include: Operating companies, IP Funds (Intellectual Ventures), Defensive Aggregators (RPX) Contribute patents/technology for equity in JV Spin off a new company Licensing Campaign ( stick licensing) Litigation campaign (NPE) 12

13 IP Licensing: Business Model Elements IP Licensing Situations: ØRoyalty free use ØAuthorized use under license = use for a royalty ØUnauthorized use = infringement >> litigation damages Licensing Implications to Consider: ØFuture Prosecution Rights: vwho controls prosecution decisions? Future improvements? vwho pays for patent maintenance? ØEnforcement (Litigation) Rights: vusually requires an exclusive license for the Licensee to bring a claim 13

14 Factors Impacting Royalty Rates Royalties Follow Industry Norms (profitability-driven) ØStructure: upfront fee v. running royalty; often both ØRunning Royalties: % of Net Sales, dollar amount per unit ØStandards Essential Patents special royalty situations Ø Royalty Caps, Minimums Other Licensing Terms: ØExclusivity v. non-exclusivity ØSub-licensing rights ØField of use ØDuration of License 14

15 KPMG Royalty Data (2012 Study) 15

16 KPMG Royalty Data (2012 Study) 16

17 University Tech Transfer Highlights (AUTM) Tech Transfer: Benefits People, Society and the Economy ØSince 1980, universities in the U.S. have spun off 4,000 startup companies Ø From 1996 to 2010, the economic impact of university and nonprofit patent licensing was: $388 billion on the U.S. gross domestic product $836 billion on the U.S. gross industrial output ØIn that period, 3 million jobs were created because of university and nonprofit patent licensing ØIn 2013 alone: 818 new companies created as a result of tech transfer; almost 75% of these remaining local 719 new products were introduced to the marketplace $22.8 billion in sales of products created and based on academic research (38% drop) ØOver the past 30 years, 153 new FDA-approved, vaccines or new uses for existing drugs were discovered through research carried our in public sector research institutions Source: AUTM Briefing Book

18 University Licensing Facts: 2014 Highlights from AUTM U.S. Licensing Survey: FY2014 Ø5,435 licenses executed (up 4.5% over prior year) Ø549 executed licenses containing equity (up 17%) Ø914 startup companies formed (up 11.7%) Ø4,688 startups still operating as of the end of FY2014 (up 11.4%) Ø965 new commercial products created (up 34.2%) Ø6,363 U.S. patents issued (up 11%) Ø$28 billion of net product sales (up 27%) Source: AUTM U.S. Licensing Activity Survey: FY

19 Outline q Open Innovation Framework q IP Monetization Models ü Make v. Buy Decision q Commercialization Assessment q Licensee Outreach q Key Takeaways 19

20 Licensing Opportunity Assessment Make v. Buy Decision IP Fit Product Fit Tech Transfer Market Fit Company Fit Successful Commercialization 20

21 IP Fit Analysis: Make v. Buy Decision Identify industries/companies that are good candidates for technology transfer through licensing (Licensees) IP Fit Industry: ØFiling trends are on the rise ØEvidence of licensing, litigation and other IP monetization activity (indication of companies looking for patents) ØIndustries that bring together multiple technologies in one product (Mobile, IoT) IP Fit Company: ØBalance of resources and IP position: Buyers/Sellers ØWhite space analysis: Filling a competitive IP Gap ØExisting IP (R&D capabilities) ØEntering a new market (prior art, time to create IP) 21

22 3D Printing Example 22

23 Patent Filing Trend for Stereolithography (SLA) 250 Patents per Source per Filing Year Patents 100 US Applications US Grants Year Source: Innography 23 2

24 Top SLA Companies by Patent Count SLA Patents per Company Patents 0 Source: Innography 24

25 Top 20 SLA Heat Map Source: Innography 25

26 SLA Market Dynamics Map (add quadrant names) Source: Innography 26

27 Top Company Topical Landscape 27

28 Company Fit Analysis: Make v. Buy Decision Licensing/Acquisitions Activity Companies with higher levels of licensing or acquisitions are likely to prefer Buy to Make Research can be done at the company level to assess the level of activity: ØWebsite: Corporate History ØWikipedia (not an official source, quick overview) ØReview of 10K filings Ø Patents assignments at the USPTO (change of ownership) ØSEC filing of license agreements Ø Royalty databases for licensing activity: RoyaltySource Kt Mine 28

29 Outline q Open Innovation Framework q IP Monetization Models q Make v. Buy Decision ü Commercialization Assessment q Licensee Outreach q Key Takeaways 29

30 Licensing Opportunity Assessment Make v. Buy Decision IP Fit Product Fit Tech Transfer Market Fit Company Fit Successful Commercialization 30

31 Commercialization Assessment Components SWOT Analysis (Technology -Product - Market Fit) Complementary Business Assets (Technology-Licensee Execution Fit) Supply Chain Analysis (Technology-Licensee Industry Fit) 31

32 Opportunity Assessment: Complementary Business Assets 32 Source: ICMG

33 Opportunity Assessment: Commercialization Licensing Along the Supply Chain 33 Source: Endeavor Partners

34 Outline q Open Innovation Framework q IP Monetization Models q Make v. Buy Decision q Commercialization Assessment ü Licensee Outreach q Key Takeaways 34

35 Licensee Outreach: Make it Personal! Work with the inventors: ØLeverage their industry knowledge and connections! Understand the structure of the IP group: ØWho makes the licensing decision: large companies (Intel, Google) have multiple IP functions: buying, selling, licensing are each independent ØBe careful not to appear as a patent troll! It s a personal business: ØFind someone who has done licensing deals with Stanford before 35

36 Network Through Professional Societies Network through professional society events, membership lists: vlicensing Executives Society (LES) vassociation of University Technology Managers (AUTM) vindustry associations (3D printing groups) vindustry events, conferences, trade shows 36

37 Spread the Word! Use the media resources at Stanford Put a press release out Reach out to key reporters covering the industry Make a video to show how it works Keep the message clear and concise Highlight the value proposition Identify key use cases 37

38 Key Takeaways: Technology Transfer Technology transfer from university to industry is part of the Open Innovation ecosystem ØLicensing is one of the common IP monetization business models for universities Finding the right licensee: ØCompanies who are likely to in-license: Make v. Buy Decision ØCompanies who are likely to commercialize successfully Successful tech transfer requires: ØIP Fit ØCompany fit Approaching Licensees requires: personal outreach, industry networking 38

39 Questions? 39

40 Contact Us Foresight Valuation Group 425 Sherman Avenue, Suite Phone: LinkedIn.com/Company/Foresight-Valuation-Group Twitter.com/ForesightValue 40