Intellectual Property Broker Auctions

Intellectual property (IP) auctions are the most effective and efficient mechanism for the sale of patents and other forms of intellectual property products in today’s global market. Providing a venue for up to 100 transactions at one event, the world’s leading patent brokers conduct auctions at luxury resorts and hotels around the world. Before we get to the auctions themselves, this article will set the stage with some basic information about intellectual property and the process of moving IP into the market.

Intellectual property consists of two basic categories. The first category includes industrial property such as patents for inventions ranging from software to medical devices, and aeronautics to cloud computing. Any type of technological invention or idea that is nonartistic in nature falls into this group. Artistic works such as novels, paintings photographs, architectural designs and the like fall into the second IP category. The subject of this article pertains to the first category of intellectual property and the primary mechanism in which these products are bought and sold.

Inventors or sellers of IP require access to a mechanism to market and sell their IP products. Intellectual property brokerage firms offer that mechanism. Based on their experience, patent brokers work as a neutral party with sellers to conduct a product assessment and market analysis to help the seller gain insight into the value of their invention or the invention they are representing. Therefore, sellers may work directly with IP brokers or engage a third-party to represent them in working with IP brokerage firms that provide auctions. Once a market value determine and the seller agrees with it, product portfolios are ready to move to the next stage: global marketing in preparation for an upcoming auction.

Auctions are the favored means by which sellers monetize their IP technology or turn their inventions into cash. IP brokerage firms collect between 40 and 100 IP portfolios from among their products and plan a live auction event to make these offerings available publicly. Through their network of investors and interested parties, patent brokers build interest in the specific offerings for upcoming auctions to potential investors all over the globe. In order for an offering to be successful in creating a lucrative deal for the inventor, the patent brokerage functions as the conduit, mediating between buyers and sellers throughout transaction.

IP Auctions require entry fees and are often full-day events that include meals. At any given auction, somewhere between 200 and 300 people are in attendance including sellers, inventors, technical companies, universities, lawyers, bankers, start-ups, fortune 500 businesses and folks there for the first time to see what it is all about and are most likely future buyers and sellers.

Live auctions are sometimes held along with a summit. Summits feature panel presentations by industry leaders on innovative topics that relate to the intellectual property market. The auction itself generally lasts 45 minutes to an hour with potential buyers being pre-qualified to make purchases. Some buyers preserve anonymity using proxy bidders. Bidding on IP portfolios take place both in-person or via telephone bids at the live event. Each IP property within a portfolio has a confidential reserve or minimum purchase price. If no bids exceed that reserve, the item held for a future offering or reevaluation. Once a sale transpires, the buyer has a limited time to complete the transaction including full payment. Once the deal is completed, the broker then provides due diligence and makes applicable documents available for review.

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