CLIENT EDUCATION SERIES | BUSINESS VALUATION INSIGHTS
How AI and Intangible Assets Are Reshaping Business Valuations
By Christian Schweizer, MBA, CVA — April 4, 2026
Ask most business owners what gives their company its value, and they will point to things they can see and count: equipment, inventory, vehicles, real estate. These are tangible assets — and for most of the last century, they were the primary drivers of business worth. Those days have quietly slipped out the back door.
Research on publicly traded companies shows that intangible assets now represent upwards of 80 to 90 percent of total corporate value in the United States — up from less than 20 percent in the 1970s. That shift has traveled all the way down the economic ladder to small and privately held businesses. As a Certified Valuation Analyst, I often come across business owners who are surprised to discover that the most valuable things in their company have no line on the balance sheet — and that artificial intelligence is accelerating this transformation faster than most owners realize.
What Intangible Assets Actually Are
An intangible asset is any resource that contributes to a business’s earnings but lacks physical substance. In formal valuation work conducted under NACVA Professional Standards, these assets are identified, categorized, and valued using accepted methodology — not estimated or ignored. The major categories that appear in private business valuations include:
- Customer relationships and lists: A loyal, recurring customer base with high retention rates is one of the most consistently significant intangible assets in small business valuations. Two companies with identical revenue may be valued very differently depending on whether that revenue comes from long-term clients under contract or from one-time transactional buyers.
- Proprietary technology and software: Internally developed platforms, custom-built tools, and operational systems that are not available off the shelf create competitive advantages that translate directly into value.
- Brand and market reputation: A well-known trade name, a dominant local presence, strong online ratings, and premium pricing power all represent assets that took years to build and could not be replicated quickly by a competitor.
- Data assets: Proprietary customer data, behavioral records, clinical databases, and the datasets used to train machine learning models are an emerging and rapidly growing asset category. Many business owners are sitting on data they have never thought of as an asset at all.
- Assembled workforce: The value of a trained, experienced team — particularly in knowledge-intensive businesses — is a recognized intangible that affects both the earnings capacity of the business and the risk a buyer assumes at closing.
How AI Is Changing the Equation
Artificial intelligence introduces complexity into business valuation from two directions simultaneously, and a business owner needs to understand both.
On one side, AI is creating value. Businesses that have built or deployed AI-driven tools — whether for customer service, pricing, logistics, underwriting, diagnostics, or operations — may be generating structurally higher margins than their industry peers. A company that uses a proprietary AI model to reduce errors, accelerate throughput, or serve more customers with fewer staff has created a competitive advantage. The valuation question a CVA must answer is whether that advantage is durable and transferable: a proprietary AI system trained on years of unique operational data is a defensible asset. A generic AI subscription that any competitor can license tomorrow is not.
On the other hand, AI is also putting pressure on value. For businesses whose earnings rely on rule-based tasks that AI can now perform faster and more cost-effectively — such as routine document processing, content generation, translation, and certain categories of professional services — the sustainability of current earnings is increasingly under scrutiny. Sophisticated buyers and their advisors are already factoring this into their analyses. Any valuation that does not explicitly address this dynamic risks being incomplete.
“AI does not affect every business the same way. For some, it is the most significant value creation opportunity in a generation. For others, it represents a risk to earnings that must be assessed honestly. The difference matters enormously in how a business is valued today.”
AI’s Impact: Value Creator or Value Risk?
Whether AI enhances or threatens your business value depends largely on the nature of your competitive advantage and how AI intersects with it:
AI as Value Creator | AI as Value Risk |
Proprietary AI trained on unique data | Revenue from tasks AI can now automate |
AI that improves margins structurally | Expertise that AI replicates at lower cost |
AI that enables scalable growth | Workforce skills with declining market value |
AI-generated operational competitive moat | Pricing power eroded by AI-driven competitors |
What This Means for Your Business Today
The practical implications for a business owner are straightforward, even if the underlying analysis is not. First, if your business has built meaningful intangible assets — strong customer relationships, proprietary systems, valuable data, or brand equity — those assets are almost certainly contributing more to your company’s value than your balance sheet reflects. A formal valuation conducted by a CVA will identify and quantify them.
Second, if you have deployed AI in ways that genuinely improve your competitive position, documenting how those tools work, what data they rely on, and why a buyer could not easily replicate them is essential preparation for any eventual transaction or estate event. Undocumented advantages are discounted by buyers who cannot verify them.
Third, and perhaps most urgently: if your business operates in an industry where AI is disrupting the value of human labor or expertise, that risk needs to be assessed honestly — not to be alarming, but because understanding it is the first step toward addressing it strategically. Businesses that adapt their model ahead of disruption are valued very differently from those that are still running the same playbook when a buyer arrives.
“The balance sheet was never a complete picture of what a business was worth. In the age of AI, it is less complete than ever. Knowing what you actually own — including the assets you cannot see — is the starting point for every meaningful valuation conversation.”
This article is intended for general educational purposes and does not constitute a formal valuation opinion or engagement. Business valuations performed by this firm are conducted in accordance with the National Association of Certified Valuators and Analysts (NACVA) Professional Standards. For questions about your specific situation, please contact us.
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