At the heart of every successful business is their core product or service. The manner in which you make your product or deliver your service to your customers is what makes your company uniquely valuable in the marketplace. This is where your competitive advantage lies. It is also your biggest asset to leverage.
According to I.P. (Intellectual Property) Strategist, Jackie Hutter, “70% of business value [is] in [the] form of intangible assets.” This percentage is even higher for service-based companies who comparatively have fewer tangible assets than product-based companies that provide tangible goods (i.e. retail, manufacturing, restaurants). Download pdf for more details.
So, how do you capitalize on your most prized possession – your knowledge?
Follow these 5 steps:
1. Know Thyself. First, look at your company’s financial health by carefully reviewing your financial statements. In particular, look at the balance sheet. On a balance sheet, Assets – Liabilities = Equity. The goal is to have more in assets than liabilities to create positive equity.
2. Begin With the End. Decide how you want to grow your company. Do you want to expand or exit? Both strategies require capturing your I.P. Expansion could include hiring more employees, opening more offices, securing more partners/investors and even franchising your company.
3. Ask the Experts. Once you know how you plan to grow your company, reach out to the subject matter experts. I.P. is a tricky and potentially costly endeavor, so you want to make sure you educate yourself and get a solid team of experts behind you. An I.P. Strategist will take an inventory of all of your I.P., determine what has value and tell you how to best protect it (i.e. trademark, trade secret, copyright or even patent).
4. Document. Document. Document! You cannot protect what is not identified and captured. Business Process specialists, like Equilibria, have the technical expertise to properly capture your secret sauce and commit it to paper. An I.P. Attorney or Patent Attorney will then assist with the legal documentation to ensure optimal protection of your I.P.
5. Seek Valuation. There are seasoned I.P. Valuation experts who can actually analyze your documented I.P. for market viability and sustainability and assign a real dollar value to your otherwise intangible asset. Having this dollar figure can give your total assets the boost needed to attract the right buyer, investor or possible loan needed to take your business to the next level.
At Equilibria, we specialize in creating small business infrastructure which includes capturing a company’s “secret sauce” and have firsthand experience in documenting processes for optimal I.P. protection. If you or a fellow colleague that you know is serious about growing their company, forward this tip. We provide free 30-minute consultations and can work seamlessly with I.P. Strategists, Attorneys and Valuation Experts. Call today for a complimentary phone consultation.