What has been your most memorable case to date and why?
IP valuation cases tend to be quite memorable, as they often help an inventor or company bring a vision to market. One that stands out to me is a case where, based on our valuation of their IP portfolio, our client managed to raise $25 million in equity funding which they used to create the first data centre floating on a boat. Another one we did last year was a valuation of copyrights for a leading legal treatise, which were sold by a foundation to a major publisher.
How do you envisage your IP practice evolving over the next five years as we adapt to a world changed by the pandemic?
The pandemic has resulted in a surge of new clients, particularly on the litigation side of our business. We generally divide our services into valuation consulting engagements and litigation expert services. On the valuation side, we expect an increase in IP valuation for funding by start-ups looking to leverage their IP portfolios for equity or debt funding. On the litigation side, IP valuation in divorce cases has been a growing area of expertise for us, along with bankruptcy cases involving IP collateral valuations and corporate disputes involving the valuation of start-ups.
As president of your firm, do you give any directives to your team on how to maintain client relationships and/or add value for clients?
Our approach to client retention and growth has three key elements, which have been implemented successfully over the years. First, creativity. Working with intellectual property, one must often think outside the box when it comes to assets being valued, as well as models implemented in the valuation. Second is being responsive; clients need to know that you care about their project, even if you have many others going on simultaneously. Finally, attentivity. Working with inventors and founders requires a high degree of empathy and the ability to listen to others as they tell their stories. Background is often crucial for the layout of a monetisation strategy.
You have wide experience working with start-ups, what are some of the biggest challenges young organisations are facing in the IP space?
One of the biggest issues that we see with start-ups is that they are extremely misguided on their IP strategy. On one hand, we see a lot of start-ups advised by investors to save money on IP filings, leading to missing critical deadlines for filing patents to protect their innovations. On the other hand, we have seen start-ups that have the resources to file, but are getting the wrong advice and are over-filing in the wrong places. One extreme example is a client with a wearable product who came to us with a 75-patent portfolio, where 72 of these patents were design patents, and only three were utility patents. To ensure proper guidance on IP strategy, we recommend that start-ups have an in-house IP counsel who has their best interest in mind. At the very least, try to have an IP-knowledgeable person on the advisory board.
Being based in Silicon Valley you have a front row seat to the evolving tech industry, which emerging trends are having the biggest impact on your clients – and how is this shaping your practice?
We work in close collaboration with Stanford University and the start-up and investor communities in Silicon Valley. One major trend we are seeing is in the area of sustainability. In 2022, Stanford opened the Doerr School of Sustainability, which was created based on a $1.1 billion donation from legendary Silicon Valley venture capitalist, John Doerr. The school’s mission is to cultivate deep knowledge and high-impact solutions to pressing planetary challenges. Given the key role that Stanford’s technology transfer plays in the Silicon Valley ecosystem, this school will no doubt give birth to many future technologies and companies. This donation is also signalling the renewed interest of the venture capitalist community in the cleantech sector, one that has gone through ups and downs over the year.
Efrat Kasznik is president of Foresight Valuation Group, an IP valuation and strategy firm based in Silicon Valley. She is also a lecturer at the Stanford Graduate School of Business, teaching MBA and executive education classes. Ms Kasznik has over 25 years’ experience providing IP valuation services in support of licensing deals, technology acquisitions, M&A transactions and fundraising. She frequently serves as an expert in legal disputes involving IP and start-up valuations and damages.