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September 19, 2023

Practice Work Shop (PWS) On “Would A Formal IP Valuation System Fillip IP Financing For MSMEs And Startups?”

Featuring: Vaidehi Gupta

During last week’s PWS Session, Vaidehi Gupta (Trainee Associate) led a discussion on the topic “Would a formal IP valuation system fillip IP financing for MSMEs and startups?”. The session commenced with a discussion on the current condition and prevalence of IP valuation in India for MSMEs and startups. The members deliberated on its relative rarity, its potential reasons, and how the situation may be improved by incorporating learnings from IP financing models/schemes in other jurisdictions. The discussion then proceeded to how the establishment of an IP valuation system may increase the prevalence of IP financing in India, by increasing awareness of IP valuation and providing a regulatory framework. The members deliberated upon the practical challenges of implementing a workable IP valuation system, particularly the volatile nature of the market value of IP, the difficulty of valuing intangible assets, and the incongruity in applying established models of valuation to IP. The session concluded with a general agreement that prescribing a fixed system of IP valuation is likely to be counterproductive due to its inflexibility. The members agreed that it would be desirable to frame a voluntary scheme for IP valuation, prescribing non-binding valuation guidelines and establishing a body of professionals specially trained to undertake IP valuation.

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