AI can help surface IP to use for accessing finance, says expert

Paul Garland of Pinsent Masons highlighted the role AI can play in surfacing IP after a UK government minister made the case for IP-backed lending at a recent industry event.

Speaking at the International Trademark Association’s (INTA’s) annual meeting in London on 5 May – an event attended by IP experts at Pinsent Masons – the UK’s minister for IP, Kanishka Narayan, sought to position the UK as being at the forefront of enabling IP-backed lending. As also reported by MLex (registration required), Narayan suggested the UK government could take steps to develop policy that helps improve understanding of where IP is generated and what types of IP businesses hold are most associated with subsequent value creation and financing.

Narayan’s comments follow publication of a recent report by the EU’s Intellectual Property Office (EUIPO) in which it highlighted that IP-rich companies commonly face barriers in accessing finance, despite their strong economic potential, and stressed the need for “a coordinated policy approach … to unlock IP-backed finance”. The report concludes that priority one of five is to make IP visible and that €150-€580 billion of additional capital could be mobilised from the EU’s Savings and Investment Union (SIU).

This reflects a broader shift in IP-focussed lending amongst banks, with HSBC for example announcing a £250 million pool of assets in its ‘Growth Lending’ portfolio, supporting high-growth tech scale ups with “strong IP”.

According to Garland, businesses that understand more fully what IP they have, where it is located and what revenue it underpins, stand to gain a significant commercial advantage – particularly those unregistered but hugely valuable intangible assets like data, know-how, trade secrets and proprietary code. He said most businesses are sitting on valuable assets that they are not actively managing or exploiting to the full – including in the context of using IP as security for business financing. 

Garland said: “The comments made by the UK’s IP minister come at a time when over 90% of the S&P 500’s value lies in intangible assets, a level replicated around the world amongst tech-driven and innovative companies. This highlights the enormous potential for companies to manage and leverage those IP assets better – the growth of financing options around them is very welcome.”

“However, there’s a fundamental challenge for businesses – big and smaller, fast-growing alike – in how to identify and manage those assets in a way that is efficient and on-going. That is something that has always held things back. This is reflected in that challenge of ‘making IP visible and assigning credible value’ being specifically called out by the EUIPO’s report as a blocker,” he said.

“Registered assets can be identified and mapped easily enough, from public registers if not the business’s own records. But so often the deeper and more significant value lies in things like data, code, know-how, and trade secrets scattered throughout the business, often globally, across group companies. In many cases those assets remain uncatalogued, leading to value leakage, mostly because it has been too time consuming to manage them all. However, things are changing fast with the rise of AI tools that can help solve the issue. This is creating opportunities for businesses to increase corporate value and market advantage,” according to Garland.

Pinsent Masons has partnered with Intanify to develop an AI powered intangible asset discovery tool that can give businesses complete visibility over all intangible assets – not just those that are registered IP. The tool can further help businesses identify gaps in their IP protection, enable commercial and licensing opportunities, and identify potential tax advantages they might benefit from, among other things.