How We Value Patents

We begin by looking at the foundation of the rights themselves. Patents that are drafted with broad, defensible claims and have many years of protection left generally hold stronger commercial weight than those nearing expiration or heavily narrowed during prosecution. International filings can also expand the reach of protection, making patents more attractive to global businesses.

Beyond legal strength, the commercial environment matters greatly. Technologies positioned in industries that are growing rapidly, or that align with clear market needs, tend to score higher. We also consider how close a technology is to real-world deployment. A concept that exists only on paper carries a different profile than one already powering prototypes, licensed into pilot projects, or embedded in products on the market. Competitor activity in the same space also signals that the technology may have strategic importance.

Real-world business signals further refine our estimates. Past sales or licensing deals for comparable technologies provide useful benchmarks, while an active history of licensing or royalty streams demonstrates proven market value. Even in the absence of such transactions, the broader market landscape and prior deal activity in the sector help guide our analysis.

Technical quality adds another dimension. We analyze how often a patent is cited by others, since forward citations often indicate influence and importance in its field. We also consider originality signals from the underlying prior art — patents that carve out new space tend to be more impactful than those in crowded technical areas.

Finally, context matters. A single stand-alone patent has one kind of value, but when it sits within a larger portfolio, its contribution to a broader strategic position can significantly change the picture. The PSRP brings together these different lenses, producing an instant estimate that balances both objective data and business realities.

While the details of our model remain proprietary, what matters most is that the result helps inventors, businesses, and investors better understand the potential of their intellectual property. Our goal is to provide transparency into the factors that matter, while keeping the underlying formula flexible, adaptive, and continually improving.