Transaction Services

Brokerage Sales Process

TransactionsIP (TIP) Brokerage and Consulting provides a five step process for all of our Brokerage Sales.

  • Step 1: High Level Evaluation & Valuation of the Patent or Portfolio
  • Step 2: Determine Prospects for Acquiring Patent or Portfolio
  • Step 3: Develop Marketing Strategy & Requisite Materials for Target Prospects
    • Prepare Presentations & Collateral For Prospects
  • Step 4: Active Campaign & Manage the Transaction
    • Contact Target Prospects
    • Facilitate Buyer Due Diligence Process
    • Conduct Negotiations
    • Sign Term Sheet
  • Step 5: Finalize Agreements and Generate Revenues


TransactionsIP goal is to help our clients to leverage and maximize the returns from their IP assets. This is accomplished through well established relationships with most large IP and technology companies.

Step 1: High Level Evaluation & Valuation of the Patent or Portfolio.

TransactionsIP (TIP) will first conduct a high- level evaluation and valuation of the seller’s patent or portfolio to make a preliminary determination of its marketability and define a recommended strategy for monetizing the portfolio.

The asset owner will provide all available information with respect to potential evidence of use, infringement, and any constraints or boundary conditions of the portfolio must be disclosed to allow a proper assessment of the opportunity.

The next step is to provide a patent evaluation to analyze the patents and understand what you have. TIP uses a number of public tools and processes to identify potential licensees and target products, as well as to identify where the patents offered for sale fit into the patent landscape. TIP also uses numerous available software tools for analysis, as well as other research tools, as appropriate.

Once the TIP process identifies potential licensees and specific target product opportunities, TIP then further researches the market for the products covered by the patented technologies. If no products are likely to be using the patented technology, TIP identifies and attempts to quantify the competitive market advantage that would be gained by someone using the patented technology and the future growth opportunity. This market information is used to prepare the Sales Brokerage Package described above.

If, during the course of the market evaluation, TIP identifies products on which claim charts can be constructed, TIP will provide that information to the seller and propose the preparation of claim charts, based on available technical product literature

Once a patent or patent portfolio is evaluated by TIP, the seller will be notified of a plan of action to move forward. TIP and the client will then discuss the prospective patent’s marketability, valuation, and the manner of business engagement.

Step 2: Determine Prospects for Acquiring Patent or Portfolio

An initial list of acquisition prospects, potential licensing candidates, and specific target product companies, are identified from the previous evaluation. In addition, any potential patent infringement or evidence of use by companies provides a prioritized set of prospects.

Prior to accepting a patent or portfolio for brokering, TIP performs its own due diligence process on each patent or portfolio. This process requires answers to at least the following questions from the seller:

  1. Is this brokering opportunity exclusive, or are there others who are being asked to sell the patents?
  2. Are there encumbrances, covenants not to sue, or existing licenses pertaining to the patent(s) being offered for sale? If the answer is yes, what is the nature of those encumbrances?
  3. What rights does the seller want to retain in the patents, if any? i.e. Grant Back License
  4. Are there restrictions on which companies TIP is allowed to approach regarding the purchase of the patents? If the answer is yes, what are those restrictions? For example, can TIP market the patents to the seller’s competitors, “patent trolls”, etc.?
  5. Are there restrictions on the distribution of patent evaluation/valuation data to potential buyers? If so, what are those restrictions?
  6. What is the minimum price or “reserve” that the seller is willing to accept? What is the basis for that expectation?
  7. If a group of patents is offered, may the patents be purchased separately, or must they remain as a group?
  8. Are all international counterparts and family members (e.g. division, continuation, or continuation in- part) considered to be part of the group offered for sale? If not, which family members are not considered to be part of the group being offered for sale?
  9. Is the seller interested in pursuing a technology transfer as an additional option?


This preliminary evaluation (Steps 1 & 2) and discussion with the seller is typically completed within two to four weeks, depending on the size of the portfolio and the number of different technologies encompassed.

Step 3: Develop Marketing Strategy & Requisite Materials for Target Prospects.

Once an agreement to move forward has been established, a brokerage marketing plan is developed. A TIP technical evaluation is conducted by our engineering team on the client’s patent(s), or a subset of the patents, to determine the licensability of the portfolio and identify potential licensees who may be interested in acquiring the patent.

The TIP patent marketing process is a thorough method that starts with patent analysis, then moves on to strategic bundling, marketing collateral preparation, licensing/sales targeting, claim chart development, and a direct sales campaign.

The next step is to determine a valuation and target sales price. There are 3 classic valuation methodologies: Cost, Income and Market Approach. TransactionsIP utilizes the Market Approach for providing patent valuation. This valuation is based upon market value which is realized from market transactions and makes use of prices actually paid for comparable assets.

The Market Value utilizes the following: our data for the sellers and buyers of patents, the technology area of the patents, the total transaction, the number of issued U.S, and the average price paid per patent. Patents are a veritable moving target; with the price affected by the buyers perceived level of need plays a significant role in driving the price. How one or more specific buyers plan to use a particular group of assets will help determine the price it eventually sells for, as well as perceived need, cash position, and strength of their current patent coverage. TransactionsIP’s team of analysts develop a consensus patent valuation and sales price target approach that reflects the actual anticipated market conditions.

TIP develops marketing materials into a “Sales Brokerage Package” for the active campaign. This sales brokerage package is a comprehensive document to support the independent evaluation of the patents or portfolio by prospective buyers. The package includes the following: patented technology summary and description; investment summary; inventor or company description; key claims and illustrative evidence of use charts; market research summary of the larger market pertaining to the patented technology; market research of the products covered by the patent and claims; a list of identified licensing candidates; a list of companies in general patented technology area; a list of forward and backward patent citation references; and lastly we provide a compelling reason to purchase the patent or portfolio being offered with specific benefits that appeal to the buyer. This marketing package typically requires two to four weeks to prepare, per patented technology group.

TIP uses all traditional marketing and direct sales channels to reach our target audience. TIP offers a customized, tailored approach to put the appropriate level of resources towards the patents in a portfolio.

Furthermore, buyers will often receive large numbers of patent solicitations each month. As a result, patents not adequately prepared for sale are often ignored completely, even if the technology directly addresses the prospect’s needs.

Step 4: Active Campaign & Manage the Transaction.

a.) TIP provides an active brokering campaign to manage the transaction, which puts a knowledgeable person in charge of each aspect of the brokerage campaign.

b.) The next step in the process is to send the sales brokerage package to all of the prospect buyers. In addition to the identified candidates and companies identified above, TIP will use its list of regular buyers, who have previously indicated an interest in acquiring patents. TIP will share selected information regarding offers that are made on the patents with other potentially interested parties to help increase the level of interest and, ultimately, the offer price for the these patents. TIP will elicit the best price possible for Client’s patent(s). Client will have final transaction approval. During the marketing phase, TIP will follow up with each of the prospective buyers approximately monthly or more frequently as required, and keep the Client informed of progress monthly. In most cases, TIP requests a timeframe of 6-12 months to complete a transaction.

TIP delivers a competitive advantage by providing a compelling reason to purchase the patent(s) being offered with specific benefits that appeal to the buyer. Often it is the basic motivators of “time and money” that determine the sale: fear that if the patent (or portfolio of patents covering a single technology) is not purchased, it may be used against them someday, not only costing more money, but tying up tremendous human resources within the IP and legal department of the company; and the strategic benefit the technology covered by the patent will offer the client.

When these two motivators are adequately addressed, the patents sell at market price or greater.

Furthermore, our process is designed to bring in multiple potential targets so that a virtual auction takes place between two or more buyers. In this case, the seller is assured the best possible prices for their patents.

c.) Each buyer’s due diligence process is unique to the buyer. TIP facilitates their due diligence process by providing documents, market and product research, and recommendations on what they should consider, but does not dictate or manage their process. Based on previous experience, a buyer’s due diligence process can often require 8 to 16 weeks.

In addition to reviewing the Sales Brokerage Package as part of their due diligence process, buyers will usually require time to review the file histories of the patents, review the details of any encumbrances, perform a validity analysis which may include a prior art search, and get answers to technical questions from the seller. The higher the value of the patents, the longer this due diligence process is likely to take.

d.) TIP leads the negotiation of the sales process with both parties. All offers are presented to seller for consideration. Once a reasonable offer has been made for either a single patent or a group of patents, all other potential buyers are notified that an offer has been received and that the seller is considering the offer. A timeframe for consideration of the offer is defined and communicated to these prospective buyers. This usually generates excitement and activity in the prospective buyers’ group and often the final offer price for the patents. TIP will then negotiate the final agreement with the highest bidder, including the sales price and any specific terms and conditions. An offer is provided by the buyer and accepted by the seller thru email or a term sheet. This phase typically requires about two to four weeks.

Step 5: Finalize Agreements and Generate Revenues.

The next step is for the buyer to provide a patent purchase agreement for the seller to review and sign. The seller will be required to review and approve all agreements and obtain legal counsel if required.

Summary of Sales Process:

The result of this brokerage sales program is a well-prepared marketing campaign for the patent or portfolio with all the appropriate information needed so that the buyer can make a fast, efficient purchasing decision.

Due diligence is always required by the buyer; however, our process makes this much easier and increases the level of interest, thus bringing better sale prices to our clients.

The usual elapsed time from client signing a Brokerage Agreement with TIP and the sale and wire transfer of proceeds usually takes on average 9 to 12 month.

Sellers and Buyers include both fortune 100, small and medium sized companies, individual inventors, equity investors and patent aggregators and holding companies.

Direct Sales Campaign:

Once the initial phase is complete, TIP pursues an active direct selling campaign. TIP’s objective is to find two or more interested buyers and leverage that interest to bring in the highest possible selling price.

Setting Seller Expectations:

To better facilitate the sale of patents, it is appropriate that once TIP has positioned the patents in their best light, TIP acts as an agent for the transaction itself to bring in the highest offer that is achievable for the patent or portfolio being sold. Agreements often do not occur because of unrealistic seller expectations. TIP believes that part of our job is to set seller expectations as realistically as possible and to sell patents.