Valuation Services

Ideas, Inventions, Intellectual Property, Products, Venture

Valuation
Services

Services
Crafitti’s TRIZ, Decision Engineering and Scenario Planning based
Valuation Services for

 Ideas Articulated
 Scientific/Technological Inventions
 Intellectual Property (protected as a Patent, Trademark, etc or kept as a Trade Secret)
 Products (New or Existing ones, Software Products or Non-Software Products)
 Venture (New or Existing ones)

© Crafitti Consulting Private Limited www.crafitti.com

CRAFITTI CONSULTING IS INCUBATED AT NSRCEL @ Indian Institute of Management (IIM) Bangalore
Multi-Dimensional Multi-Perspective (MDMPTM) Valuation Methodology

Valuation of assets has been a well-established field. There are established methodologies for valuation of
assets which are being used globally, backed by comprehensively developed theories. With the advent of global
innovation economy, the assets have become more and more cerebral, conceptual and contextual. This has
created a mismatch between methodologies developed for physical assets valuation and the need of the
information, knowledge, innovation and intellectual assets.

Although the existing valuation methods have been adapted and adopted for the valuation of “soft economic
assets”, their success has been limited to say the least. The very nature of ideas, inventions, intellectual
property, products/brands, ventures, etc, calls for a different approach than adapting the existing methods for
valuation. CRAFITTI consulting has established a unique methodology to value intellectual assets based on
sound scientific principles on the value of the soft assets.
The result is the multi-dimensional valuation
methodology that takes care of, past, present and future
possibilities. The multi-dimensional valuation
methodology combines multiple perspectives from
financial, legal, utility or functional, complexity and
collaboration viewpoints. This results in a more robust
and comprehensive valuation methodology for well-
informed consensus decisions.

Crafitti Consulting’s MDMPTM valuation methodology has developed on series of methods starting from
financial valuation approaches (capitalization approach, cost-based approach, income approach, and market
approach), enhancing with a Balanced Score Card perspective, and including a multi-criteria decision-making
process such as Analytic Hierarchy Process (AHP). However, we realized the perception of future, although
being captured in these enhanced methodologies, don’t take care of multiple futures that may unfold. With
these experiences, we enhanced the methodology with Theory of Inventive Problem Solving (TRIZ) and
Scenario Planning techniques. The result is a Multi-Dimensional Multi-Perspective (MDMPTM) Valuation
methodology. This is a comprehensive methodology grounded in scientific principles and for the first time this is
offered in India.

© Crafitti Consulting Private Limited www.crafitti.com

CRAFITTI CONSULTING IS INCUBATED AT NSRCEL @ Indian Institute of Management (IIM) Bangalore
The MDMPTM is based on following high level dimensions and perspectives
 Current State
o Evaluating the current state of Complexity Assessment of a Software Product using System
Complexity Estimator based on Coupling and Cohesion
an asset – Idea, Invention, Final Evolved Design
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o Assessment of Complexity,
Stability, Risk of design around, and, Competitive market position – How close to ideal is the
asset?
 Past 5 Levels of Inventions
crafting innovation together

o Cost already spent Level 5 (<0.3%)

• Pioneering Invention – based on newly discovered phenomenon
• Pushing existing technology to a higher level
• Revolutionary

o Cost of Sale Level 4 (< 4%)

• New System Developed
• Interdisciplinary solutions
• Replacing old technology with New

o Cost of Maintaining, Enhancing and Adapting to Level 3 (19%)

• Radical change or elimination of one principal system component
• One Engineering Discipline
• Resolution of a physical contradiction
crafting innovation together

the foreseeable immediate future changes

• Slight Modification of the system

Level 2 (45%) • Knowledge from different areas within the industry

• Resolution of a technical contradiction

• A simple improvement

o Capital Borrowed to develop and status of all Level 1 (32%) • Knowledge within the trade
• No system conflicts are resolved

such pending financial debts Confidential © Crafitti Consulting Private Ltd. March 1, 2009 41

o Partners with existing stakes

 Future
o Technological Evolutionary Paths of the Asset based on TRIZ Evolution Laws
o Possible ways – and probable timeline when asset will be designed around
o Estimated Remaining Life of the asset
o Possible scenarios which may emerge in the markets the asset is operating in

© Crafitti Consulting Private Limited www.crafitti.com

CRAFITTI CONSULTING IS INCUBATED AT NSRCEL @ Indian Institute of Management (IIM) Bangalore
Multi-Dimensional Multi-Perspective (MDMPTM) Valuation does not produce a single $
number. The methodology gives a sum total of past, current and potential future value
that the asset may create in a range of possibilities. Typical output will be

Value of the Product is 2 Million USD with a range of plus-minus 15%. Given the potential of entering a new
market using this product the ability to create new, enhanced and/or cutting-edge products will increase by 50%
which has an estimated value of 1 Million USD. If the product is not enhanced with sustained customer feedback
and/or an effort is made to completely revamp the product, it is estimated that product life will not be more than
3 years. This requires the need to generate the next version or a new version of the product within 18 months.
Further, given the very high design and architectural complexity of the product which is currently estimated to be
10 times higher than the ideal design possible, the next version should not be more than 5 time s the ideal
design. We propose if the next version is not released in 30 months with cleaner less complex design, the value
of the product will be reduced by 25%. Hence in the worst case scenario, the value of the product is equal to
0.75 x (1.7+0.7) = 1.8 M USD. In the best case, the value of the product is estimated to be 3 M USD. In the
most likely scenario, this comes out to be 2.4 M USD ±15%.

About Crafitti

Crafitti Consulting is an innovation consulting firm in the business, science

and technology space. Crafitti uses a co-crafting approach to facilitate
innovation in various enterprise contexts with the help of powerful
frameworks, techniques and tools, honed over the years through research,
experimentation and grassroots application.

© Crafitti Consulting Private Limited www.crafitti.com

CRAFITTI CONSULTING IS INCUBATED AT NSRCEL @ Indian Institute of Management (IIM) Bangalore
How do we work with our co-crafters?
The CRAFITTI engagement includes processes to explore any system through our science based proprietary
frameworks developed over a period of almost 2 decades of experimentation, exploration and evaluation. The
process steps include mining Patent and web based information in a particular field to provide large number of
triggers in multitude of directions for the Inventive minds to come out with large number of ideas for developing
products, processes and patents in the chosen technical field. The Co-crafting Innovation methodology results in
a large number of possible ideas that can be converted for commercial benefits in very quick time. Starting from
the vague information about the technological area to look into, the Co-Crafting Innovation process rapidly
penetrates through the barriers of psychological inertia in the minds of experts, to create insights into the
problems that have hitherto been not possible. The systematic way to convert the unidirectional thinking along
the core competencies of the experts in the fields into multi-dimensional storms of ideas in a limited amount of
time is the greatest benefit that the clients have achieved through the Co-Crafting Innovation Engagements.

Contact Details

© Crafitti Consulting Private Limited www.crafitti.com

CRAFITTI CONSULTING IS INCUBATED AT NSRCEL @ Indian Institute of Management (IIM) Bangalore