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Calculating the value of technology start-ups

已更新:6月 7

London, UK - OxValue.AI to launch in June 2021 to offer a novel way of determining the monetary value of a technology (pre or post patent grant) filling a significant gap in existing methods and potentially creating a decision-making tool for investors.


A variety of methods are currently used to work out what new technologies are worth, from simple financial formulas to highly complex techniques, combining qualitative and quantitative models.


However, the existing techniques have significant drawbacks – they are either purely theoretical and cannot be used in practice, are mainly based on past financial investment, and do not reflect the value of creativity and novelty, or they rely on subjective assessments. This means they tend to have poor predictive power.


Now OxValue.AI to launch and pioneer a new approach drawing on big data and artificial intelligence. OxValue.AI is designed to commercialise the VEST (Valuation of Early-Stage Technology) Valuation Tool, which leverages a number of variables including patent data, initially in Information and Communication Technology (ICT) companies. And the VEST valuation tool is an algorithm to estimate the monetary value of a technology (pre or post patent grant).


VEST was developed in a research project lead by Professor Xiaolan Fu – Professor of Technology and International Development, University of Oxford and Chair of OxValue.AI. The researchers created a database that matched all UK start-ups – defined as being less than five years old between 2006 and 2015 – with records of patents granted in the relevant technology fields by the world’s major patent grant offices during the same time period. The resulting database matched over 1,500 patents to 143 UK ICT firms.


Based on this study, the researchers were able to develop a model that could determine how the characteristics of the patents, the characteristics of the companies themselves, and the market into which the technology was introduced explained variability in their ultimate value. The model was able to explain around 85% of the variation in the value of technologies owned by the start-ups in the whole database.


By inputting information about these same characteristics for technologies that are about to be commercialised, the model can be used to predict what they will be worth.


For example, the researchers tested the model on Deepmind, the company that created AlphaGo and which was later acquired by Google. Using the model, their estimate of the value of Deepmind was between around $590 million and $660 million; Google paid $650 million to acquire Deepmind in January 2014.


‘The model has already proven itself to have a highly accurate predictive power, especially for technologies at an early stage of commercialisation,’ said Professor Fu – Chair of OxValue.AI. ‘It also uses completely objective data, which is a significant improvement on existing methods.’


In late June 2017, the research was named Best Paper by the Innovation Strategic Interest Group at the 2017 European Academy of Management Annual Conference.


VEST is the practically applicable model develop in this research project to appraise the value of early-stage technology and innovation based on large, linked patent-firm data.


OxValue.AI will be launched in the International Investment and Innovation Forum (and launch of OxValue.AI), taking place at Zoom on Friday 25th June 2021, The forum and launch, which are kindly sponsored by CIPRUN (the largest Chinese IP company) and Yingde Group (One of the most active inward investment company, invested more than 170 companies in 2019), will be run in partnership with the Technology and Management Centre for Development (TMCD) at the Department for International Development, University of Oxford (ODID).


Notable speakers attend the event will include Prof. Xiaolan Fu, Direct of TMCD of Oxford University; Prof. Diego Sanchez Ancorchea, Head of ODID of Oxford University; Pro Vice Chancellor of Oxford University; Lord Tim Clement Jones, Co-Chair of All Party Parliamentary Group on Artificial Intelligence; Sacha Wunsch-Vincent, Head of Economics and Statistics Division, WIPO; Co-Editor, Global Innovation Index; Eugene Qian, Chairman of UBS Securities; Dr. Junmin Kong, CEO of IPRUN; Chris Fellingham, Oxford University Innovation etc.


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