What is data as an intangible asset and how do you value it?

Full Explanation

Raw data (customer names) has near-zero value. Data that trains a model to reduce churn by 10% has significant value. Valuation: estimate the profit impact of superior data insights (churn reduction × customer LTV), discount to present value. Example: a fintech company's proprietary credit scoring data allows 20% better approval decisions versus competitors, capturing an extra £5M in profitable customers annually. Discounted at 12% over 10 years, data asset is worth roughly £28M. Data quality matters: is it clean, complete, and current? Stale data is worthless. Data ownership matters: do you actually own the data legally (GDPR compliance)? If data is licensed or guest-dependent, value is contingent. Data moat strength: how long does your data advantage persist? If competitors can replicate data in 6 months, the asset depreciates quickly. If network effects mean your data improves faster than competitors (e.g., Uber's routing data), the asset is defensible long-term. Risks: privacy regulations, changing customer behaviour, data breaches. Opagio's framework helps companies articulate data advantage and quantify its contribution to competitive positioning.

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