Digital Property Collateral Protection via IP Valuation and Insurance

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Solution Overview

Problem

Current systems lack the ability to effectively utilize intellectual property as collateral for loans, as lenders are hesitant due to inadequate methods for analyzing the value and risk associated with digital property, limiting access to funding for entities with substantial intellectual assets.

Innovation Solution

A system and method for digital property collateral protection that involves a pre-underwriting analysis, including a broking analysis and qualitative valuation, to assess the viability of using intellectual property as collateral, allowing for the issuance of a loan with an insurance policy to protect against potential risks, enabling lenders to mitigate risks and provide funding opportunities.

Engineering Contradictions & Design Principles

VSEngineering Contradiction Analysis

1Adaptability or versatility

If lenders use traditional collateral assessment methods, then tangible assets can be reliably evaluated, but intellectual property assets cannot be effectively utilized as collateral

Engineering Contradiction:

Improveability to use intellectual property as collateralVSAvoidaccuracy of digital property valuation

Core Design Contradiction:

Adaptability or versatilityVSMeasurement precision

Solution Approach 1:

The system segments the intellectual property valuation process into distinct components: broking analysis (assessing marketability and liquidity), qualitative valuation (evaluating IP quality and strength), and quantitative analysis (calculating specific value metrics). This segmentation allows each aspect of IP value to be measured independently and systematically, resolving the contradiction between adaptability to IP collateral and measurement precision.

Inventive Principle:

Principle #1Segmentation

Solution Approach 2:

The patent introduces an intermediary insurance policy that bridges the gap between lenders and borrowers regarding IP collateral. The insurance policy acts as a mediator that assumes part of the risk, allowing lenders to accept IP as collateral without directly bearing the full valuation and risk uncertainty. This intermediary mechanism enables IP to be used as collateral while protecting the lender from potential valuation inaccuracies.

Inventive Principle:

Principle #24Intermediary (Mediator)

2Productivity

If lenders accept intellectual property as collateral without insurance, then access to funding increases, but risk exposure increases significantly

Engineering Contradiction:

Improveaccess to funding for intellectual property ownersVSAvoidrisk mitigation for lenders

Core Design Contradiction:

ProductivityVSReliability

Solution Approach 1:

The system implements beforehand cushioning by requiring an insurance policy to be in place before the loan is finalized. This pre-established risk protection cushions the lender against potential losses from IP devaluation or other risks, enabling them to confidently provide funding to borrowers with IP collateral without excessive risk exposure.

Inventive Principle:

Principle #11Beforehand cushioning (Prior cushioning)

Solution Approach 2:

The insurance policy serves as an intermediary that transfers risk from the lender to the insurance provider. This allows the lending relationship to proceed with improved reliability, as the insurance intermediary absorbs the risk elements that would otherwise prevent IP from being accepted as collateral.

Inventive Principle:

Principle #24Intermediary (Mediator)

3Measurement precision

If comprehensive analysis of intellectual property is performed, then valuation accuracy improves, but time and complexity of the lending process increases

Engineering Contradiction:

Improveaccuracy of intellectual property valuationVSAvoidtime required for pre-underwriting analysis

Core Design Contradiction:

Measurement precisionVSLoss of time

Solution Approach 1:

The system performs preliminary actions by conducting the broking analysis and qualitative valuation during the pre-underwriting phase, before the actual loan decision is made. This preliminary assessment of IP quality and marketability establishes a foundation for faster subsequent processing, as the complex analytical work is completed in advance rather than during the final decision-making process.

Inventive Principle:

Principle #10Preliminary action

Solution Approach 2:

By segmenting the analysis into distinct phases (broking analysis, qualitative valuation, quantitative assessment), the system can prioritize and complete the most critical assessments first. This segmented approach allows lenders to make informed decisions based on the most important factors without requiring every possible analysis to be completed, thereby reducing overall time loss while maintaining valuation accuracy.

Inventive Principle:

Principle #1Segmentation

Data Source

PatentUS11508006B1Digital property collateral protection

Publication Date: 2022.11.22 MOAT METRICS INC DBA MOAT

AI summary

Systems and methods for digital property collateral protection are disclosed. For example, a pre-underwriting analysis may be performed to ascertain the quality of a given borrower and the intellectual property associated with the borrower. If the borrower passes the pre-underwriting analysis, an underwriting analysis including an intellectual property valuation may be performed. If the borrower passes the underwriting analysis and the terms of a loan and insurance policy are otherwise agreed upon, a lender may issue a loan to the borrower with the intellectual property as collateral, and an insurer may issue an insurance policy to the lender to insure against covered events.