Intellectual property evaluation

You're looking for a price tag because you're building a partnership with someone?

Then you don't really need a price tag per se; you need a proportion. For instance, if you and your partner both agree that what you each bring to the table is worth 50% of the business, then you each get 50% of the business. So if he brings in 5K then that'd value your IP at 5K, if he brings in 100K then that values your IP at 100K. Of course, you could agree on a different split but the concept remains.

So for the purpose of partnering, I'd first recommend you agree on a split and work from there. And don't just think of the IP as the end-of-all; to make a business work, you'll need a lot more: skills, experience, relationships... Here's a good question to read too: Forming a new software startup, how do I allocate ownership fairly?

Good Luck.

In investor terms, the valuation of IP is the income it generates over time.

Without market traction, or some sort of patent protection, it is difficult to come up with a solid number. IP evaluation companies would be happy to do all the market research to determine the potential revenue that could be generated - but that conveniently leaves out the fact that market adoption isn't solely based on technical capabilities. Customer development is important as well.

There is a neat calculator that you can use to determine a running companies valuation - but a project does not a company make.

I'll assume that are looking for a defensible methodology to refer to, vs hiring a ip valuation services company - here is a good stanford university study entitled "what is your software worth?" that may be of interest to you.

You could conjure up a number you believe the software is worth, but an educated guess is still a guess. But - if that is the hurdle you must pass to get investor commitment, then so be it.

Good luck!