It’s a busy week for technology with CES in full swing in Las Vegas! Here at IV, we just announced another license agreement with a top tech company, SAP. 2011 is shaping up to be a busy year for IV, and we’ll continue to share our news with you as it happens. Check out the Press Releases page if you’re interested in learning more about some of our other recent deals with top tech companies including HTC, Samsung and Digimarc.Read the full story »
A few weeks ago Edward Jung, IV’s founder and CTO, blogged about creating an invention ecosystem. IV contributes to that ecosystem in a variety of ways. One of the less known ways is to benefit companies by using financial instruments to allow them to monetize their patent portfolios. This allows those companies to provide value to their shareholders while funding future innovation. We have a team here at IV who does exactly this.
Recently the head of that division, Vincent Pluvinage, described two circumstances where capital was used to leverage the value of patents. Here Vincent answers the question, Who benefited from these deals?
First example. A couple of years ago, we led the purchase of more than a thousand patents that Motorola had filed during the development of the first generation of Iridium Satellites. The original venture went bankrupt after billions invested in this ambitious project, and was purchased for a mere $25M by private equity investors that slowly built up a profitable business. When the “new” Iridium had to select a supplier to build the NEXT generation of satellites, IV sold most of the patents (and a license to other satellite patents) to a French Financial Institution. Thales, a French satellite constructor, was able to help Iridium secure the debt financing in part because of the patents. Here is the value chain: Motorola got to sell an aging and expensive to maintain patent portfolio for immediate cash two years ago. Thales won a $2.9B contract. Iridium secured $1.8B of debt financing. IV investors made a profit on the patent transactions. The initial inventions were recycled and blended with new innovations from a French engineering team, in order to create a better performing constellation to satisfy new needs.Read the full story »
Creating a market for intellectual property (IP) was one of our clear goals in founding Intellectual Ventures. We saw an opportunity to develop a system of buyers and sellers setting value for intellectual assets through open competitive markets where none had existed before. In just a few years this market, and IV, have grown faster than we’d ever imagined they would.
But in addition to buyers and sellers, an IP market needs to be fed by a continual stream of innovative ideas. That’s why, from the outset, IV has also focused on creating an ecosystem of invention: a stable and dynamic community of participants interacting with one another and their environment to produce useful and valuable inventions.
A business strategist named James F. Moore first applied the biological term “ecosystem” to business in 1993, in an article he wrote for the Harvard Business Review. Moore also described a special type of ecosystem relevant to our purposes: a keystone ecosystem, in which one very large player has a key stabilizing and defining role in the ecosystem itself and in the growth of other ”organisms.” The ecosystem model emphasizes the interdependence of its members. The health of each participant depends on the health of the other members, and in particular the health of the keystone. Likewise the keystone player gets critical support from the goods and services provided by its partners, producers, and suppliers.
At IV, we want to encourage a stable and dynamic ecosystem of invention. If you’re interested in learning more about the ecosystem business model, I recommend a book co-authored by one of IV’s inventors and program managers, Roy Levien: The Keystone Advantage: What the New Dynamics of Business Ecosystems Mean for Strategy, Innovation, and Sustainability.Read the full story »
Just this past spring, IV partnered with New South Innovations (NSi), the group responsible for commercializing research and technologies at the University of New South Wales in Sydney, Australia. IV and NSi’s agreement provides financial incentives to UNSW researchers for submitting new invention ideas. We are excited about this partnership – and so is the team at NSi.
Don’t just take our word for it. To introduce the partnership with IV, NSi has produced a new video, which they released this week, featuring IV’s very own Dr. Patrick Ennis, Global Head of Technology. We are looking forward to working with such a cutting-edge organization as NSi, as well as the many talented inventors at UNSW.Read the full story »
Today we are launching IV Insights, the Intellectual Ventures corporate blog. IV Insights will give you information about what is happening at IV as well as our insights on industry news and events.
For our first post, we wanted to start with the question we get most – What does IV do anyway?
Our CEO, Nathan Myhrvold, wrote an in-depth article earlier this year on just this topic for Harvard Business Review. If you really want to understand IV’s vision and business model, this is the best resource.
If you just want the summary: IV’s goal is to lead the way in building an invention capital market. This is an ambitious vision with a long timescale, but we are a committed bunch of people!
Our business model has many moving parts but basically, we treat invention as an asset. We want to make investing in this asset class a profitable activity. Bottom line is: ideas are valuable. It’s important that inventors get paid for their inventions and that corporate innovators who understand the competitive value of a strong IP portfolio have an efficient way to find the inventions they need to operate freely and competitively.
To get to our goal, we fund and support inventors to come up with new ideas and we invest in existing inventions. We then work to package inventions and get them into the market through a variety of business development and licensing efforts. We also have a group of projects we do around what we call global good efforts -- these are projects focused on finding solutions for some of the world’s hard problems in energy, climate and global health – particularly malaria.
Face it: inventors make people a bit nostalgic. We all have our favorite inventor story. Yet the world has taken the importance of invention for granted. By making invention a for-profit activity, we believe we will incentivize more people to take necessary risks on coming up with radical new solutions and ultimately the world will benefit.
This sums up our first official blog post. We hope to update the blog weekly, but please bear with us as we get into the groove of regular posts. You can also sign up for the blog’s RSS feed and follow IV on Twitter @IVinvents.Read the full story »