Closing the Deal Is Easy, Owning the IP Is Hard

September 2, 2025

When most people think about mergers and acquisitions, they picture financial models, integration timelines, and celebratory closing dinners. What often gets overlooked is the invisible layer that can determine whether a deal thrives or unravels: intellectual property. For a long time, IP was something deal teams worried about after signing. Unless the deal was a pure technology acquisition, questions about ownership or licensing were pushed to the integration stage. That approach no longer works. Companies today don’t just make physical products—they run on data, software, algorithms, and know-how. In this environment, intellectual property is not a formality. It is the deed to the house. Ignore it, and you may discover after the fact that you don’t actually own what you thought you bought.

This shift in thinking hasn’t been sudden or dramatic, but it has been deliberate. Dealmakers, investors, and advisors have seen too many transactions falter because intellectual assets were not addressed early enough. They’ve learned that questions of who owns what, who can use it, and whether rights will survive the closing are not legal niceties. They are strategic questions that determine whether the deal value holds. Consider the carve-out of a business unit built on a shared technology backbone. On paper, the separation looks straightforward. But under the surface, datasets, code bases, and R&D pipelines may be deeply intertwined. If no one untangles them until after closing, both parties could end up dependent on the same IP—or worse, one party could be left without the rights it needs to function at all. The result isn’t just inefficiency, it’s the erosion of the very value the deal was meant to deliver.

The same risks appear in acquisitions, particularly when the target company’s competitive edge comes from software or data-driven products. These are often fast-moving deals where financial diligence dominates, but if no one verifies that the target truly owns the code it relies on, or whether licenses terminate upon change of control, the buyer may inherit liabilities rather than value. In my experience, the deals that stumble aren’t the ones that fail to spot the numbers—they’re the ones that fail to ask the right questions about intellectual property at the right time.

The good news is that leading dealmakers are already adapting. Instead of leaving IP specialists out of the process until the end, they create an “IP narrative” for the deal right at the start. That narrative explains in clear terms which assets drive the business, who owns them, whether those rights will remain intact after the transaction, and how they support the commercial rationale for the deal. Framing IP in this way allows legal, business, and technical teams to stay aligned from diligence through integration. It also makes the deal move faster and with fewer surprises, because everyone is working from a shared understanding of why the IP matters.

There is another lesson emerging as well: owning the IP is only part of the equation. You also need the infrastructure to manage it. Too often, IP functions are small, underfunded, and overlooked during integration planning. Yet if innovation is central to the deal, those teams are essential to maintaining continuity and enabling growth. In carve-outs, both NewCo and RemainCo need governance, talent, and systems to protect and enforce their portfolios. In mergers, integration planning has to address not only which rights belong to which entity, but how two IP teams will work together to safeguard and leverage the combined assets. Overlooking this step can lead to inefficiencies, margin erosion, or even the quiet loss of competitive advantage.

Finally, the legal mechanics themselves matter more than many executives realize. In an asset deal, every patent, trademark, and copyright must be identified and properly assigned. In stock deals or mergers, ownership may transfer automatically, but licenses may not, and third-party consents can still be required. Lapsed filings, unwaived moral rights, and gaps in the chain of title can all weaken the portfolio and create vulnerabilities. None of these issues are new. What is new is that they can no longer be brushed aside until after the closing. Dealmakers understand that overlooking them undermines not just the legal paperwork, but the commercial logic of the deal itself.

The rise of software, data, and AI has changed what companies are really buying and selling. Intellectual property is no longer a box to check—it is the infrastructure of innovation, the backbone of continuity, and the foundation of growth. The best dealmakers know this. They treat IP not as a constraint to work around, but as a lever to pull. And in doing so, they build transactions that don’t just close—they endure.

As you think about your own growth strategy—whether you’re acquiring, divesting, or preparing for investment—the question isn’t simply “what is the business worth?” It’s also “what IP makes that value possible, and will we own and control it on Day One?” If you’re not asking that now, you should be. The time to bring IP into the conversation isn’t after signing—it’s at the very beginning, when the deal logic is still being written.