Trademark and Tradenames
Customer Relationships
Software, URLs
Patents and More
Expert Valuations of Intangible Assets
The valuation of intangible assets is performed for buy/sell/lease consideration, collateral lending/financing, financial reporting, tax reporting, or dispute purposes. As indicated above, there are two general categories of intangible assets:
1. Identifiable (separable) Intangibles Assets
Identifiable intangible assets can be sold and licensed separately from the business enterprise that owns them. Examples of identifiable intangible assets are customer relationships, trademarks and tradenames, software, copyrights, formulas, patents, goodwill, URLs, and domain names. Businesses are built on assets such as the name of a famous actor or chef, a computer operating system (software), a brand name for shoes or purses, a pharmaceutical formula, a patent for a medical device.
Example 1 – Trademarks and Tradenames: What does the company or person’s name represent to you: quality, value, expected result, sophistication, exclusivity, taste, health? You can choose to purchase a substitute for the named product, but you select the specific product because you enjoy and/or trust it. What additional value does that tradename bring to the product? How much more can the seller charge for this product than for competing products just by having the name you look for stamped on the box. Companies purchase and license trade names to brand or rebrand their products, businesses, and services rather than spending the time and money to build up their own trade name. Trademarks and tradenames are bought, sold, and licensed.
Example 2 – Patents: Patents have value because they protect, or are intended to protect, the product’s originator from copy and sale by others. When patents for successful products expire, generic and other substitutes arrive on the market to take market share. Patents are regularly bought. sold, and licensed.
2. Non-Separable or Value-Added Intangible Assets
A business’ skilled or trained workforce, management team, and know-how may be desired by an investor or competing business, but these intangible assets are not easily separable from the business enterprise itself. The value of these assets can be additive to the overall value of the business, even providing a competitive advantage to comparable businesses, but one would have to purchase the business enterprise itself to gain value from these intangible assets.
The valuation of businesses and assets rely on the application of three generally accepted approaches to value: market approach, cost approach, and income approach. We consider these same approaches when valuing identifiable intangible assets:
Market Approach: The market approach relies on the comparability of the subject asset to similar assets that have sold. This exercise works well for a large percentage of physical assets (machinery, equipment, vehicles, real estate), but it is not easily applied to intangible assets. Transaction data for sales of intangible asset sales for providing a similar function and serving a similar market can be challenging.
Cost Approach: The historical cost incurred developing the asset does not typically represent the value someone would pay to purchase or relate to the rate one would license the asset. However, a replacement cost approach is sometimes pursued to provide an indication of value – especially for intangibles such as software and assembled workforce. In this approach, a valuation professional builds a theoretical cost to create a new replacement for the subject asset today, and then may adjust for obsolescence.
Income Approach: The value of intangible assets is most often derived with the application of one or more income approach methods:
- Relief from Royalty Method: Value is calculated based on a hypothetical royalty rate that the owner would theoretically pay but avoids by owning the asset. The royalty rate used is based upon market data for similar classes of assets: patents, software, tradenames, etc.
- With and Without Method: Value is calculated by the comparing a discounted cash flow analysis for the subject business including the benefits of the asset (with) versus excluding the benefits of the asset (without).
- Multi-Period Excess Earnings Method (MPEEM): A discounted cashflow analysis where cash flows associated with a specific intangible asset are isolated, and then discounted back to present value. MPEEM is often utilized when a single asset such as software or customer relationships is the primary value driver for a company.
- Real Option Pricing: This model is often used to value assets that have potential but are not currently generating cash.
The valuation of intangible assets requires not just quantitative skills, but also qualitative analysis and judgement from an experienced independent professional.
For more information, please contact one of the professionals below:
How Marshall & Stevens can help with Intangible Asset Valuation
Our Intangible Asset Valuation team collaborates with our internal multi-disciplinary professionals to provide the value analyses and fresh independent opinions to fiduciaries, financing sources and investors for public and private company transactions.
Real Estate Valuation
Attorneys, accountants, wealth managers and financing sources refer their clients to Marshall & Stevens because we deliver high-quality work through an insightful, service-oriented approach.
Business Valuation
Whether for purchase, sale, investment, gifting, recapitalization, or equity/option grants, establishing an understanding of value is crucial for decision makers.
Machinery and Equipment
Our Machinery and Equipment valuation professionals spend the time necessary to provide reliable analyses.
Frequently Asked Questions
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Marshall & Stevens meets the IRS’ “Qualified Appraiser” standard, valuing real estate, businesses, intangible assets, and equipment for estate and gift tax reporting purposes.
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Real estate should be looked at strategically for potential beneficial tax reporting, financial reporting, depreciation including cost segregation and bonus depreciation, financing including sale leaseback, etc.
The fair market value of acquired real estate is often much higher than the seller’s capitalized basis and the allocation between land (not depreciable) and improvements (depreciable) is often different than what the assessor has determined.
For financial reporting, the value of acquired real estate needs to be allocated to land, building and improvements, and intangible assets.
The Marshall & Stevens Difference
Marshall & Stevens provides Fairness and Solvency Opinions, valuation analyses, investigative accounting, and expert witness services to assist public and private clients with their important transactions and litigation matters.
Client Highlights
Here are a few client success stories from public and private companies we’ve worked with
Intangible Asset Valuation Contacts at Marshall & Stevens
Background
John Agogliati is Senior Managing Director for Marshall & Stevens Transaction Advisory Services, LLC providing Dispute Resolution & Litigation Support, Fairness Opinions & Solvency Opinions.
Mr. Agogliati has been in the financial valuation industry since 1998. He performs valuation analyses of closely held companies, financial instruments, derivatives, and complex assets for transactions, litigation, estate and gift tax planning and reporting, and financial reporting purposes in a variety of industries. He leads Fairness Opinion and Solvency Opinion assignments.
Mr. Agogliati serves as a valuation consultant and as an expert witness in matters such as business interruption, breach of contract, product liability, shareholder oppression, legal malpractice, and accountant malpractice, among others for matters that have come before bench trials, jury trials and panel arbitrations.
Prior to joining Marshall & Stevens in 2017, Mr. Agogliati worked in the valuation practice of multiple accounting firms including Deloitte, LLP. Mr. Agogliati earned a Master of Business Administration degree in Finance and a Bachelor of Science in Chemical Engineering with a minor in Economics from Lehigh University. He is a Chartered Financial Analyst (CFA®) Charterholder and an Accredited Senior Appraiser (“ASA”) in business valuation. He is a member of the CFA Institute, the New York Society of Security Analysts and the American Society of Appraisers.
Professional Highlights
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- Member, New York Society of Security Analysts
- Member, American Society of Appraisers
- Marshall & Stevens, Inc.
Senior Managing Director, 2017-present - Anchin, Block & Anchin LLP
Senior Consultant, 2017 - Berdon LLP
Principal – Litigation, Valuation and Dispute Resolution Group, 2004-2017 - Deloitte & Touche
Manager, 1998-2004 - Fuss & O’Neill
Chemical Engineer, 1995-1996 - Ogden Martin Systems
Chemical Engineer, 1994-1995
Background
James Sieman serves as a Principal and Managing Director for the Financial Valuation & Consulting practice of Marshall & Stevens Incorporated. Mr. Sieman is responsible for all financial and multidisciplinary assignments in the Southeast Region.
Active in the valuation profession since 1998, Mr. Sieman provides financial valuation and consulting services to private sector clients and publicly traded companies in a broad range of industries as well as to government agencies. Areas of specialization include complex valuation studies and consulting engagements requiring a financial or multidiscipline approach relating to Fairness Opinions for mergers & acquisitions, intellectual and other intangible property for allocation (ASC 805) and transfer pricing, estate & succession planning and reporting, employee stock ownership plans (ESOPs), stock options, warrants, SARS, etc. (ASC 718/IRC 409a), recapitalizations and equity financing, bankruptcy, reorganization, divestitures, litigation support for dissolutions, stockholder and ad valorem disputes, and SEC and IRS Compliance.
Mr. Sieman received a B.S. degree in Finance from Purdue University. He attends numerous educational seminars in valuation theory and practice. Mr. Sieman is an Accredited Senior Appraiser (ASA) of the American Society of Appraisers.
Professional Highlights
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Managing Director, 2009-present - Kroll
Director, 2005-2008 - Shepard Schwartz & Harris LLP
Director, 2003-2005 - Marshall & Stevens, Inc.
Manager, 1998-2003
Background
Darleen Armour is a Managing Director for the Financial Valuation and Consulting practice with Marshall & Stevens. She is responsible for all financial valuation assignments in the West Region. Ms. Armour leads the Technical Standards Committee for the national Financial Valuation & Consulting practice.
Ms. Armour has been in the valuation business since 1987. Her experience includes Fairness Opinions, Solvency Opinions and the valuation of businesses, intangible assets, and securities for financial reporting purposes (purchase price allocation and impairment), estate and gift tax reporting, equity compensation/stock options (IRC 409A), ESOPs, and litigation support.
Ms. Armour works with public and private companies in a wide range of industries. She has a great amount of experience in the valuation of entertainment and media companies and their intangible assets including film libraries and music catalogs.
Prior to joining Marshall & Stevens, Ms. Armour has served as Director of BDO’s Valuation and Business Analytics practice, Senior Vice President at FMV Opinions, Inc., and Senior Vice President at Houlihan Lokey Howard & Zukin, Inc.
Ms. Armour served as an Adjunct Professor at California State University, Fullerton teaching a Graduate Level Business Valuation/Mergers & Acquisition Course from 2010 to 2018.
Ms. Armour has been qualified as an expert witness, has provided testimony, and been a neutral third appraiser in arbitration and legal proceedings.
She is an active member of the Association for Corporate Growth having served on the Orange County Board of Directors from 2001 – 2020 and is a member of the Membership Committee for the Los Angeles Chapter of the Association for Corporate Growth.
Professional Highlights
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- Membership Committee, Los Angeles Chapter
- Orange County Board of Directors, 2001-2020
- Marshall & Stevens, Inc.
October 2015-present
‣ Managing Director, Financial Valuation & Consulting, 2019-present
‣ Director, Financial Valuation & Consulting, 2015-2019 - BDO
Director, Valuation & Business Analytics, 2014-2015 - FMV Opinions
Senior Vice President, 2012-2014 - Cronkite & Kissell
Principal, 2001-2012 - Houlihan Lokey
Senior Vice President, 1987-2001
- California State University, Fullerton
Adjunct Professor, 2010-2018
‣ Business Valuation/Mergers & Acquisitions (graduate level)
Background
Juozas Pranckevicius is a Senior Manager for the Energy and Infrastructure practice at Marshall & Stevens Incorporated. He is responsible for the valuation of businesses, debt and equity instruments, and intangible assets.
Mr. Pranckevicius joined Marshall & Stevens in February 2023. He provides financial valuation analyses for public and private companies for a variety of industries. Engagements include analyses required for financial reporting purposes (purchase price allocations and impairments), estate and gift tax reporting, intellectual property valuation, equity compensation/stock options (IRC 409A), ESOPs, and litigation support.
Prior to joining Marshall & Stevens, Mr. Pranckevicius was a Manager in Hilco Global’s Enterprise Valuation Services group, a Supervisor in Jackson National Asset Management’s Valuation Team, and an analyst in US Bank’s Global Structured Finance practice.
Mr. Pranckevicius is actively involved in the Lithuanian community in Chicago and is an Audit Committee member on several Lithuanian based nonprofit organizations.
Professional Highlights
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Senior Manager, 2023-present - Hilco Valuation Services, LLC
Enterprise Valuation Manager, 2021-2023 - Jackson National Asset Management, LLC
May 2015 - December 2021
‣ Valuation Supervisor, 2021
‣ Senior Valuation Analyst, 2019-2021
‣ Valuation Analyst II, 2015-2019 - U.S. Bank
Financial Analyst, 2013-2015 - Celadon Group Inc.
January 2012 - August 2013
‣ Pricing Analyst / Internal Audit Associate, 2012-2013
‣ Finance / Yield Intern, 2012 - David A. Noyes & Co.
Wealth Management Intern, 2011 - Central Business Services, INC (CBSi)
Tax Accounting Intern, 2010
Background
David A. Gaynor, ASA, is a National Practice Leader for our Financial Valuation Practice and Managing Director of our Healthcare Valuation Practice. Mr. Gaynor’s responsibilities include overseeing the delivery of valuation services to the Firm’s financial valuation clients.
Mr. Gaynor has more than 22 years of consulting experience, specializing in the valuation of businesses and business interests, intangible assets, liabilities, and complex securities in connection with mergers and acquisitions, financing, estate and gift tax planning, charitable contributions, litigation support services, strategic planning, fairness opinions, Employee Stock Ownership Plans (ESOPs), accounting matters, and recapitalizations. Mr. Gaynor has served clients in a wide variety of industries, including the healthcare, food & beverage, restaurant, consumer products, telecommunication and manufacturing industries.
Prior to joining Marshall & Stevens, Mr. Gaynor led the Healthcare Valuation Group at Crowe, LLP. He has also been employed at CohnReznick, LLP and EisnerAmper, as well as Management Planning Inc. and Pluris Valuation Advisors, LLC.
Mr. Gaynor earned a Bachelor of Science in Finance from The College of New Jersey in Ewing, NJ.
Mr. Gaynor is an Accredited Senior Appraiser (ASA) in business valuation with the American Society of Appraisers. In addition, Mr. Gaynor is a Member of the Appraisal Issues Task Force (AITF), a Board Member of the Towson University Family Network, and a Member of the Montgomery Township, NJ Budget and Finance Committee. Mr. Gaynor is a frequent writer and speaker on valuation topics.
Professional Highlights
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- Board Member, Towson University Family Network
- Member, Montgomery Township, NJ Budget and Finance Committee
- Marshall & Stevens, Inc.
December 2019-present
‣ Managing Director, Northeast Financial Valuation Practice Leader, 2023-present
‣ Managing Director, 2019-2023 - Crowe
February 2014-November 2019
‣ Managing Director, Healthcare Valuation Services Leader, 2019
‣ Senior Manager, 2014-2019 - CohnReznick LLP
Senior Manager, 2012-2014 - Pluris Valuation Advisors LLC
Vice President, 2010-2012 - Management Planning, Inc.
Vice President, 2008-2010 - Valuation Research Corporation
Vice President, 2007-2008 - Crowe Horwath LLP
Manager, 2004-2007 - EisnerAmper
Supervisor, 2002-2003
Background
Matthew R. West, is a Principal and Executive Managing Director with Marshall & Stevens Incorporated. He serves as National Practice Leader for the Healthcare Practice and the Energy & Infrastructure Practice. He is also active in the Financial Valuation & Consulting Practice.
Mr. West specializes in the valuation of healthcare systems, physician practices, business enterprises, debt and equity instruments, and intangible assets. Analyses performed are used for compliance and consulting purposes including buy/sell consideration, purchase price allocation (FASB ASC 805), capital stock/stock option valuations (IRC 409A, FASB ASC 718), impairment (FASB ASC 350), estate and gift tax reporting, ESOP formation and reporting, and financial reporting of complex financial instruments including auction-rate securities (FASB ASC 820). He also leads Fairness Opinion engagements.
Mr. West has a specialty in the valuation of dialysis centers and practices.
Mr. West has provided expert witness testimony in valuation and economic damage assessments on separate occasions in the states of Colorado and Oklahoma.
Mr. West earned a Master's in Business Administration with an emphasis in Accounting and Taxation from St. Louis University and a Bachelor of Science in Business Administration and Finance from the University of Kansas.
Mr. West is an Accredited Senior Appraiser (“ASA”) of the American Society of Appraisers, in the Business Valuation discipline and in Intangible Asset Valuation. He has also received a Certification of Completion, American Society of Appraisers— Advanced Multidisciplinary Healthcare Valuation Education Program.
Professional Highlights
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Executive Managing Director, 2002-present
Background
Simon Koo is a Director in the Financial Valuation and Consulting Practice of Marshall & Stevens Incorporated.
Mr. Koo provides Fairness Opinions and Solvency Opinions for public and private company transactions. He performs valuations of closely held businesses, portfolio companies of private equity and business development companies, as well as intellectual property and other intangible assets, and complex securities, including debt, preferred stock, options and warrants, and contingent consideration using Monte Carlo Simulation and Option Pricing Model methodologies.
He serves clients in a variety of industries including technology, media, pharmaceutical and life sciences, health services, industrial products, retail and consumer products, and food and beverage industries. Engagements are typically provided to assist clients with buy/sell consideration, financing and recapitalization, financial reporting, tax planning and reporting, and matters of dispute.
Mr. Koo joined Marshall & Stevens in 2019. Prior to Marshall & Stevens, he worked in the valuation practice of PWC, Grant Thornton, and RSM.
Professional Highlights
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- Marshall & Stevens, Inc.
Director, Financial Valuation & Consulting, 2019-present - RSM US LLP
Supervisor, 2018-2019 - PwC
Valuation - Senior Associate, 2016-2018 - Grant Thornton LLP
Valuation Associate / Senior Associate / Manager, 2011-2016 - Ardour Capital Investments
Equity Research Associate - Intern, 2010-2011
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Intangible Asset Valuation
Bankruptcy, Reorganizations, and Restructuring Consulting
