How to value intangible assets?
A digital asset is anything that generates a Startup, App or an entrepreneur, in order to develop your product in a digital environment.
What is a digital asset?
A digital asset is anything that generates a Startup, App or an entrepreneur, in order to develop your product in a digital environment. This passes through the creation of databases, business models or directly to the finished digital product. Putting the correct value on a digital asset is crucial for businesses, since business depends on knowing the value of that product on the market. From this knowledge, we can better execute purchase or investment.
We would all like to be able to assess an App or Startup, but to do so we must take into account all related aspects. Often, the first problem noted is the part of the investment corresponds to the positioning between users, and which part corresponds to the product software.
At an event, Muhtar Kent the president of Coca-Cola said, "If I were given the choice between all the machines, trucks, and factories of my company or the intangible assets, without a doubt I would chose the latter."
There is a physical part in traditional business, which refers to everything you need for the company to provide the service or product.
A part of digital assets corresponds to the digital data that the company uses to operate. An intangible element is the image that consumers have of a specific company, a term that usually defined as branding. Image also has an effect on the value of the company.
For startups the coordination of the two, intangible and tangible assets, is even more complicated because a large part of the company is intangible. The intangible assets are not only determined by the image of a brand established among users but also the digital nature of the business model. Startups try to facilitate solutions to digital needs, therefore the process of creation, as the consumption of the user are performed in a digital environment. These circumstances have changed the model of consumption. We have gone from physical machinery creating products or physical services to an intangible image.
Can I sell my digital asset?
In Pivotta we are able to perform purchase and sale of intangible parts of a startup. The services we offer have led us to develop a digital asset assessment tool. Just like when you start in a new company, you buy a table and chair to work more productively. Pivotta offers you the opportunity to buy the digital assets that other companies have left and that can facilitate the growth of new startups.
How to assess the price of a digital asset? To start, Pivotta has a team of pricing of digital assets, always seeking the best price for both buyers and sellers. One of the elements used by Pivotta for the assessment is the statistics generated by the asset. We studied the possibilities that the assets have on a current market and how it could benefit another company. The most important thing is that both sides are satisfied with the agreement. So we look for the relationship between the cost and the time saved which will benefit the buyer. In the same way that the seller receives a fair price for the hours employed.
Rating an intangible asset is one of the most complicated parts of the sale of a product. There are many factors that need to be taken into account and it can be difficult to break down correctly. Pivotta can break down and answer this complicated question that started this article: How to value intangible assets?