An OFB Fireside Chat brought together a small group of industry IP professionals to discuss an essential topic: licensing – and in particular, how companies can turn IP into real, measurable business value. What emerged from the discussion was not a single approach, but a set of recurring patterns, challenges, and practical considerations that shape how licensing is implemented in organizations today.

Licensing starts with business – not with IP

A recurring point across the discussion is that licensing does not begin with patents, trademarks, or technologies. It begins with the business. Organizations that approach licensing from a purely IP-driven perspective often struggle to create impact. The more effective starting point is a different set of questions:

  • What are the strategic objectives of the company?
  • Where are dependencies, risks, or growth opportunities?
  • And where could licensing support these objectives?

In this sense, licensing becomes one option among several strategic levers. It can be used to:

  • create additional revenue streams
  • reduce reliance on specific markets or customers
  • or extend the reach of existing products and technologies

But this only works if licensing is designed to support the core business, not compete with it.

The real challenge begins after the deal

One of the most consistent observations in practice is that signing licensing agreements is not the main difficulty. The real challenge lies in what happens afterwards. Even well-structured licensing programs often fail to capture their full economic value. This is rarely due to intentional misconduct. Instead, the reasons are structural:

  • reporting systems differ across partners
  • product definitions are interpreted inconsistently
  • contractual terms are not fully reflected in operational processes

Over time, this leads to gaps between what has been agreed and what is actually realized. This shifts the focus of licensing. It is no longer primarily about deal-making, but about performance and execution. Organizations that treat licensing as an ongoing operational capability – with clear governance, monitoring, and compliance structures – are significantly better positioned to capture its full value.

The bottleneck is organizational, not technical

Across companies and industries, a similar pattern emerges: the main barriers to licensing are not technical – they are organizational.

In many cases:

  • business units focus on their core activities
  • licensing is not part of their immediate priorities
  • and there is no clear ownership for driving licensing initiatives

As a result, even when valuable IP exists, it is not actively leveraged.

A key reason is that licensing sits at the intersection of different functions. It requires input from:

  • IP teams (for the technical and legal aspects)
  • business units (for market understanding and commercial decisions)
  • and management (for strategic direction and resource allocation)

Without alignment across these levels, licensing initiatives tend to stall.

Building momentum: start with concrete cases

Given these challenges, large-scale licensing strategies are rarely the most effective starting point. Instead, successful approaches often begin with specific, clearly defined cases. This means:

  • identifying a particular technology or product
  • exploring a concrete external application
  • and developing a focused business case

This approach has two advantages. First, it reduces complexity. Second, it makes the potential value more tangible, which is critical for building internal support. Over time, these individual cases can form the basis for more structured licensing activities. But the initial step is often small and pragmatic.

Managing the trade-off: exclusivity vs. value creation

Licensing inevitably raises strategic questions. One of the most important is the balance between exclusivity and value creation. On the one hand, companies aim to protect their competitive advantage. On the other hand, licensing can unlock additional revenue and strategic opportunities. There is no universal answer to this tension. Instead, companies need to define clear boundaries. Typical approaches include:

  • focusing on regions where the company is not active
  • licensing technologies that are not central to the core business
  • or structuring agreements in a way that limits competitive impact

In practice, even licensing to competitors is not uncommon — as long as it is done in a controlled and strategically aligned manner.

Making the case internally

One of the most practical challenges is how to build support for licensing within the organization. Unlike core business investments, licensing opportunities are often associated with uncertainty. Revenues can be estimated, but not guaranteed. This makes it difficult to present a clear, risk-free business case. In this context, external benchmarks can play an important role. Showing how other companies monetize their IP – and the scale of revenue generated – can help create awareness and trigger interest at management level. At the same time, internal communication needs to be carefully structured. Licensing should not be positioned as an abstract opportunity, but as a concrete contribution to business objectives.

Licensing as a strategic capability

What ultimately emerges from these discussions is a broader shift in how licensing is perceived. It is no longer seen as:

  • a side activity
  • or a purely defensive tool

Instead, it is increasingly understood as a strategic capability — one that connects IP, business strategy, and operational execution.

Developing this capability requires:

  • alignment across functions
  • structured processes
  • and a clear understanding of where licensing creates value

Companies that invest in these elements are better positioned to turn IP into a tangible business asset. Others risk leaving significant value unrealized.

The experts

Andreas Jacob
Andreas Jacob focuses on the strategic design of licensing models. His work centers on aligning licensing structures with business objectives – from diversification of revenue streams to market expansion and risk management. Rather than starting from legal frameworks, his approach begins with the business model and defines how licensing can support and enhance it in a structured and sustainable way.

 

Tomas Geerkens
Tomas Geerkens works at the intersection of licensing operations, compliance, and value realization. His focus lies on the performance of licensing programs after agreements are in place – ensuring that contractual value is effectively captured in practice. This includes building transparency, improving reporting structures, and identifying gaps between contractual intent and operational reality, with the goal of turning licensing into a reliable revenue-generating function.