Jeremy Phillips on Intangible Capital

Jeremy Phillips, a leading blogger on IP Finance and other blogs has just written a review of Intangible Capital. He says:

It’s much more fun to read than the rather solemn title suggests,
combining strands of history, economics, management, metaphor and common sense, personal experience and anecdote. It’s also a monument to the metamorphosis of management and asset management philosophies from the age of bricks and mortar to the world of the internet…it gets the reader into the mindset for asking the right questions…Read the review

The Value of Intellectual Capital

A recent post by Pat Sullivan prompted salutes here by IP Think Tank and here by IP Finance. Basically, Sullivan says that the current financial crisis “busts an intellectual capital myth,” that the value of intangible assets is the difference between the market value of a company and its tangible assets. It is from this approach that many of us often say that 70-80% of the value of a company today is intangible.

Sullivan entreats his readers, “I hope the recent vertiginous slide in stock prices will cause you to reconsider.”

I’m not convinced. The market does not value companies by looking at their balance sheets. In most cases, it never has. But I have always found the comparison between corporate valuations and tangible book value to be a powerful way Read more