Guest post by TransactionsIP LLC
There are many companies and small businesses which are entirely dedicated to discover new things and inventions to keep them ahead in the market. But at the same time it is important to protect your discovery and inventions that you have made. To secure a patent against your invention is the best way to protect your invention from getting copied or sold in an unauthorized and illegal manner. Patents also provide you with lots of money so it is important to have your patent valuation done if you don’t have any kind of idea or you are confused related to the value of your invention.
What is a patent?
A patent is an agreement or bond that provides you with exclusive rights of your invention. A patent excludes the other person from making a copy of your invention, using your invention or technology without any prior notice or request, selling your technology illegally and in unauthorized manner. Once you have received the patent for your invention, then only you can make claim for any false or illegal practice done against your technology or invention.
Patent valuation is important to know the value of your invention or technology. Valuation of the patent also helps you in deciding the suitable price for your invention while selling it to the other companies. Patent valuation comprises of three approaches which are cost, market and income.
- Cost approach: Cost approach signifies the replacement cost of the invention. If a person is interested in buying your invention, then according to this approach he will provide you with a certain amount of money suitable for your invention. In this approach, your invention is replaced by the money that is being offered to you. In general words, he will be paying you to buy your patent rights in his name. You no longer can make claim on him after replacing the patent from your name to the buyer’s name.
- Income approach: This approach works on future earnings or profits that will be made by using the technology. This approach is futuristic approach and provides you with valuation in respect to the future. Company uses the invention in order to increase its sales or generate big revenue out of it.
- Market approach: Market value approach provides you with the value equal to the past similar technology that has been patented and used in the market. The value of your invention will be determined according to the similar inventions that are already present in the market.