An innovative intellectual property financing mechanism was announced on Dec 16 in Beijing's high-tech Zhongguancun center.
The system involves companies combining IP evaluation, guarantees, loans, investment and exchange functions.
The China Technology Exchange and the State-Owned Properties Investment and Management Co of Haidian District have developed it.
They expect to provide customized financing products and systematic solutions for small high-tech companies that "often meet challenges in IP evaluation, pledge and disposal", said Xu Xiangyang, deputy chairman of the CTE.
He said such companies typically feature low assets, high growth potential, high risk and high profit.
IP evaluation will be carried out based on the Patent Value Analysis Index made in 2012 by the CTE and the State Intellectual Property Office, the first patent evaluation system in the world.
A guarantee company was newly founded, with registered capital of 200 million yuan ($32.1 million), along with a 200 million yuan debt investment foundation and a 500 million yuan equity investment foundation.
Loans will be offered not only by banks, but small loan institutions, insurance, financing and trust companies and peer-to-peer lending platforms -commonly known as the P2P business.
IP trading will have multiple platforms including the CTE, equity exchanges, investment institutions and industry associations.
Under the mechanism, a strategic alliance was formed by a number of financial service providers such as banks and investment companies, which will cooperate in financing local high-tech companies.
The system has also won support from SIPO and the government of Haidian district.
Ma Weiye, director-general of SIPO's Patent Management Department, said at the unveiling ceremony that with the good location and preferential policies in Haidian, the new financing system is able to provide optimized IP services to companies.
He also said that the system, as an innovation in service model, could be promoted to other parts of the country.
"The establishment of the mechanism offers a new approach to systematically work out the high-tech companies' problems in debt and equity financing with market-based means," said Meng Jingwei, deputy director of Haidian district government. "It is one of our latest attempts to innovate technical financing."
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