German patent funds are still up and running - REVISED 26 Aug 10
Although IP Bewertung (IPB) has filed for bankruptcy, I understand that the patent funds it managed on behalf of Deutsche Bank are still operating and are now under the control of a Munich-based boutique called Clou Partners. This has been around for 10 years and specialises in intangibles. I am told that it was Clou that first came up with the idea for the funds and it received close to 3% of the €200 million that they raised. It is now Clou's job to turn that investment into profit - something that IPB clearly found very tricky.
With regard to IPB itself, I have been told - though not by someone who was inside the company - that it received a total of around €20 million for managing the three funds. It was also entitled to a success fee of 8.3% on deals once these had generated an internal rate of return of over 13%. Given that IPB was a relatively large operation (the company had a staff of around 90 apparently), it is quite likely that the success fee was pretty crucial to ongoing viability - so if that was not being obtained, then it is not hard to see how things would eventually come to a head.
While IPB was able to buy patents without too much problem, the difficulty it apparently had was in putting together licensing deals. This does chime with what quite a few people are saying generally about the IP market at the moment: licensing deals are hard to do, especially at what licensors would consider to be decent rates. I imagine that this is especially the case if a concerted enforcement programme is not part of your strategy. Whether IPB had such a programme I just do not know - though it was never mentioned when I spoke to the people who ran the business.
As I say, this is not information I have received from someone who was with IPB, so it could be that I only have half the story or that some of what I have reported is not right. If this is the case, I would be very happy to make corrections or clarifications. Furthermore, I am happy to talk to anyone from IPB either on the record or anonymously: so please get in touch if you wish.
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