The value of intangible assets

What are intangible assets and how much are they worth?

Before we start to value data in specific settings, we’ve got to get a global picture of how much data is worth to our organization today. And fortunately, a lot of companies out there have started to research this, and they’ve started to look at how much a proportion of the balance sheet is made up of intangible assets. Now, data is an intangible asset, but before we go too deep, let’s take a quick overview of what intangible assets look like.

Is your data an asset?

So is your data an asset? Well, yes, if you’re able to identify data and you can define what it is and where it is. Also, it needs to promise future economic benefits to the organization and that data has to be under your control. It has to be something that you have the right to use.

How much of my business is made up of intangible assets?

Let’s start by looking at the growth in value of intangible assets on the balance sheet and Ocean Tomo has been doing this research since 1974. Let’s see what they’ve got to say. Here is that chart that Ocean Tomo published. And you can see tangible assets in red and intangible assets in yellow.

Back in 1975, just 17% of the balance sheet was an intangible asset. The vast majority were tangible assets, but that slowly has changed across 1985, 1995, 2005 and 2015.

The most recent survey during the pandemic in 2020 that 90% of the S&P 500 market value is now made up of intangible assets.

Data spanning more than a quarter century for the U.S. make it clear the economy is inverting from one where value was measured by “touch” to one where value is driven by thought.

Ocean Tomo