Written by: Keegan Caldwell

As disruptive technologies rewrite the rules of business overnight, your company’s success may hinge on your ability to see—and seize—the future before your competitors do.

Groundbreaking innovations are reshaping entire industries at unprecedented speeds, and as exciting as this is, transformation at this level presents a problem—particularly for enterprises looking to position themselves for successful exits with strong IP portfolios:

I believe one of the most powerful solutions to this problem is called technology scouting. Whether you’re a startup founder eyeing a lucrative acquisition or an established firm preparing for an IPO, the insights gained through technology scouting can be the difference between a mediocre exit and a game-changing valuation.

Understanding Technology Scouting

Last year, the global technology scouting service market reached a valuation of around $1.16 billion and, according to recent reports, it’s on track to reach $1.81 billion by 2030. That’s a CAGR of 6.74%, and it reflects a sector agnostic, steeply increasing need for identifying and integrating innovative technologies.

And while large enterprises are the primary users of technology scouting services, in my experience, small- and medium-sized enterprises are expected to show the fastest growth.

So, what does the technology scouting process entail, and how can it be leveraged to drive your IP strategy and exit planning?

Put simply, technology scouting is a process of identifying and evaluating emerging technologies, trends and opportunities that could impact a business or industry. Often, this term also sits under an umbrella organizations refer to as competitive intelligence. Technology scouts constantly scan for opportunities that could either enhance your competitive edge or pose potential threats.

Four Key Strategies For Technology Scouting:

1. Defining objectives: Clearly articulating what technologies or capabilities your company needs to stay competitive or enter new markets.

2. Horizon scanning: Continuously monitoring various sources—from academic publications and patent databases to startups and industry events—to identify relevant technological developments.

3. Assessment and validation: Evaluating the potential impact, feasibility and strategic fit of identified technologies.

4. Recommendation and action: Proposing strategies for engagement, whether through in-house development, partnerships, licensing or acquisitions.

What sets technology scouting apart from traditional research and development (R&D) approaches is its external focus and agility. While internal R&D is crucial, it can often be siloed and slower to adapt. Technology scouting, on the other hand, allows companies to tap into a global pool of innovation, rapidly identifying and capitalizing on emerging trends.

Maximizing IP Portfolio Value Through Technology Scouting

Technology scouting, when aligned with a sound IP strategy, can significantly enhance the value and impact of your IP holdings, providing your company with an advantage over your competitors.

Another benefit of technology scouting is its ability to provide early insights into emerging technologies and trends. Naturally, this foresight is invaluable when it comes to shaping a strong IP strategy. By identifying promising technologies before they become mainstream, you can:

• File patents early. This helps you establish a strong position in emerging fields.

• Develop a strategic patent portfolio. Make sure it covers not just your current products but also potential future innovations.

• Identify areas where you can establish dominance. Continuously monitor competitors’ filings to identify trends and potential gaps in the market.

In a study of millions of patents issued by the USPTO between 1976 and 2020, patents identified by “patent hunters”—or technology scouts using competitive intelligence practices—were often overlooked by others yet ended up having a greater impact on average.

Specifically, companies or individuals who adopt such patents early despite their initial obscurity have been found to experience a 6.4% increase in sales growth, a 2.2% rise in Tobin’s Q (a measure of a company’s market value relative to its assets) and a 2.2% increase in new product offerings.

Technology Scouting and Exit Goals

Whether you’re aiming for an acquisition or an IPO, the value of your company is intrinsically tied to its innovative potential. This is where technology scouting becomes not just a tool for staying competitive but a powerful catalyst for maximizing your exit value.

For instance, if you’re aiming for acquisition by a major tech company, your scouting efforts can help you identify and protect innovations that complement their existing portfolio. If you’re planning an IPO, technology scouting can help you demonstrate a robust pipeline of future innovations, enhancing investor confidence.

In the eyes of investors and potential acquirers, your value is often in your potential for future innovation. Technology scouting allows you to paint a compelling picture of this by showcasing awareness of emerging innovations and providing concrete plans for future developments based on scouting insights.

This forward-looking approach can significantly enhance your attractiveness to investors or acquirers, potentially driving up your valuation.

Scouting A Successful Exit

In an era where innovation moves at lightning speed, technology scouting has become an indispensable tool for companies looking to build valuable IP portfolios and position themselves for successful exits. Moving forward, technology scouting will only grow in importance.

My advice: Everyone from startup founders dreaming of a lucrative acquisition to more established firms eyeing an IPO should invest in robust technology scouting capabilities now. Your future success—and your exit value—may very well depend on it.

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