Knowing and having control over your competitive advantages is always important. But it becomes even more critical during a downturn. Rouse Consultancy helps scale-ups and established companies to identify their intangible assets and build strategies to protect that value.
In the hard realities of market economics, downturns often drive a reassessment of value.
Investors in start-ups and scale-ups become more careful about where their money is going. They want to see evidence of cash-generating potential. In big companies, unit and project heads may be forced to justify their need for financing. Where value is deemed insufficient, headcount reductions or other cuts may be on the table.
The good news is that the value often does exist – it just needs to be properly identified, refined and communicated. This is where Rouse Consultancy comes in.
“We help businesses to improve their performance by understanding the value of their intellectual property and other knowledge-based intangible assets,” says Rouse Principal, Tim Smith. “We typically work with the C-suites of scale-ups looking for capital, or we help the heads of IP functions to work better with the rest of the business and communicate properly up to senior management.”
Founded in 2017, Rouse Consultancy essentially blends a traditional management-consultancy proposition with the specific IP capabilities that Rouse is known for. The work involves studying a company’s competitive advantages – including, but not limited to its IP – and linking those assets to commercial drivers.
Managing the complexity of value
“The IP industry works with a subject matter that is defined by law, but that actually needs to be assessed from multiple perspectives. One of these perspectives is the value it creates for the owner. This is not always clearly defined,” says Global Head of Rouse Consultancy, Thomas Randes.
“The second problem is that a lot of entities do not know what can constitute intellectual property,” says Randes. “These days so much unrealized value lies in processes, algorithms and other strategic capabilities that distinguish a company from its competitors. We help to manage and control these things by identifying what is valuable, orchestrating a means to protect it, and creating a solution that brings long-term value.”
In today's industry landscape, companies often adopt intricate, multi-sided business models. These can involve various revenue streams, including selling products or services to consumers, data retrieval, and charging for additional offerings beyond freemium services.
“Navigating this complexity can be challenging. Many entities find it difficult to succinctly answer the question: ‘What are you selling today?’ It’s critical for businesses to effectively manage and communicate the totality of their offerings to their target audiences,” says Randes.
This exercise is necessary for both capital-seeking growth companies and more established players. During a downturn, knowing your value can help you to protect it when investment dries up or consumers stop buying. Rouse Consultancy helps companies to prioritize those assets with the most value.
“The extreme scenario in a downturn is that everybody has to save regardless of the value that something creates. But before that, there is often a stage where you have an opportunity to prove the value,” says Randes. “Since about a year ago, investors have wanted to see cash flow potential. We help to improve a company's ability to show this to investors who are uncertain in today’s world.”
“These days every company or function needs to show its value,” he says.
Building resilience in a changing world
In Europe, the consultancy has helped a number of companies to improve the visibility of their assets and strategic capabilities towards investors. For example, a construction-industry entity that was trying to acquire capital was struggling to define and articulate the benefits of its solution.
“The company has a system that can greatly reduce costs in the construction process. But it was nothing particularly new and therefore hard to identify where the value lay,” says Randes. “We helped them to identify their specific advantages and then protected those through patents and trade secrets. This strategy will ensure the company can maintain lower costs for longer than its competitors can.”
Another example client from Europe is a consumer-technology company that had acquired some IP and needed to ensure it did not infringe upon any patents in the value chain. Rouse Consultancy studied the company and identified poor communication practices between different functions that should have been working well together. The project involved clearly defining roles and accountabilities, establishing communication channels, and setting shared targets.
Sometimes identifying value means money can be saved. Rouse Consultancy also helped a large global retailer to avoid investing in a digital project that would not have achieved the company’s end goal. The data requirements and algorithmic capabilities were a lot higher than had been expected.
As Rouse is historically strong in China, the consultancy has been helping many Chinese multinationals as they experience rapid growth. Internal IP functions in China are often limited to the local perspective, so Rouse provides guidance that helps these companies to identify and play up their strengths in the international context. Chinese companies are also increasingly concerned with cost control and building resilience to geopolitical turmoil.
“Outside forces are causing Chinese companies to re-evaluate their IP-filings and create more structured packages aimed at delivering longer-term value. We help them with this,” says Smith.
“One of the projects we did for a Chinese client was aimed at ensuring value five years from now. Despite the current crunch, companies need to make sure they’re not just saving in the present but also investing in the future.”
