With AISTEMOS CEO Nigel Swycher in the chair, Sir Robin Jacob (head of IBIL, UCL) opened the discussion by asking whether IP monetisation and its treatment as an asset class is actually such a new topic, adding some critical comments concerning the "toxic mixture" of factors that make not just patent litigation (a major driver of IP monetisation) but all litigation such big business in the United States. These comments triggered a variety of responses. Larry Cohen (Latham & Watkins) thought it easier now to raise money on the strength of ideas, though it's still true that those who need the money don't know where to go for it while those who have the money have too little idea as to how to evaluate the worth of an idea-based loan. This lack of knowledge of IP on the part of lenders, if excusable since the banking community has more to deal with than merely IP, was emphasised.
published its Banking on IP report last November) then spoke of the problem he had identified, which is not one of starting up new innovation-based businesses but one of scaling them up. In the Far East we've seen state-sponsored capital being made available, but the preference of the UK was for private sector finance. Topics raised here included the presentation of information at the point at which a loan was sought, the difference between one-patent-per-product industries and those which are more complex. The use of Big Data to unravel these complexities was advocated -- bearing in mind that machines can deal with data, but they can't understand it. Should people who make decision on the basis of data analytics be fired? That's an overstatement, but those self-same analytics can take away jobs by doing the unintelligent tasks and leaving only the intelligent tasks to IP decision-makers.
Following a short break for the purpose of replenishing empty plates and then not-so-empty stomachs, the discussion resumed, opened again by Sir Robin.
Tony Clayton pointed out that this is already being done for the copyright industries with the Digital Copyright Exchange: so far, things have gone slowly [this blogger wonders whether there should be some reference to the Copyright Hub here], but the trick is to persuade people who own the copyright that there is a market for their copyright properties. By taking a non-transparent, short-term position, they are hampering the growth of the market. Roger Burt added that there are two very different types of market for IP: one is for IP that people want to use, like essential technologies governed by FRAND terms, and one is for IP that people don't apparently want to use.
|Risk: a game for some, but a matter
of life or death for an IP-owning business
Tony Clayton next observed that banks are more interested in getting money back after they have lent it than in gaining a security which they can dispose of if the loan is not repaid. The quality of the patent and an understanding of it are not much use in this regard. Roger Burt supported this: the borrower's business plan is key and (as Larry Cohen observed) it's not merely the quality of the business plan but the quality of its execution that counts.
Sir Robin closed the breakfast by saying he'd never participated in a meeting quite like this. Neither had we, and a good time was had by all.