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Since April this year Intellectual Ventures has had a partnership with the largest grain processor in Finland. The deal – which has the not unambitious aim of helping to tackle global food supply - may help IV counter the ‘troll’ label often used by many of its critics. It could also provide a template for other NPEs to follow as they seek to counter claims that their business model is a drain on economic activity and a hindrance to innovation.
Raisio is a major agricultural player in Europe and has developed a revolutionary new cattle-feed supplement, Benemilk, which could have a positive impact on global food quality and help to counter shortages. The feed increases the protein content of milk, reduces greenhouse-gas emissions from cattle, increases daily milk yield and raises feed efficiency by more than 10%, while on average allowing a cow to produce one more calf during its breeding lifetime.
Beyond Finland, Raisio has manufacturing facilities in the UK, Poland, the Czech Republic and other countries in Europe, but has no significant presence in Asia, Australia, or North America. And that's where IV comes in, as this video shows. The deal is three pronged and focuses on the original invention underpinning the Raisio offering. First of all, IV protects and strengthens the product’s position by increasing the size of the Finnish company’s IP portfolio. Secondly, IV has invited leading global experts working in cattle health to Finland with the intent of producing more Benemilk-related inventions; as a result of these meetings by 1st August 10 new patents had been filed. Finally the deal also establishes a joint venture called Benemilk Oy; this will be responsible for promoting and licensing the Benemilk portfolio worldwide.
Successful NPEs are very good at monetising IP. In order to do this they need to have wide-ranging knowledge not only of patents and technology, but also of markets and how to identify potential partners. In short, they possess revenue-generating skills that are lacking in many traditional businesses that might create great products, but do not have the expertise and/or connections to scale them. As the IV/Raisio hook-up shows this creates an opportunity for partnerships between NPEs and operating companies. I understand that IV is soon to announce similar type collaborations, in both the US and further afield, with companies operating in industries as diverse as paper packaging, coffee and meat processing.
The IV/Raisio deal shows that NPEs can use their expertise in leveraging IP to work with operating companies in ways that go beyond privateering. While organisations such as the UN, World Bank, IMF, and WHO actively address various global challenges it is likely that private sector innovation will play a big part in resolving them. IV may be demonstrating that huge opportunities exist for NPEs to play a significant role in that process. Other players in the space would do well to follow the firm’s lead. And in working with operating companies on matters of social importance they may begin to shake off that derogatory ‘troll’ label too.
Licensing, IP business