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0 pointsridruejo14y ago0 comments

Having faced a similar dilemma in the past back when I was an student, the advice I got was that any kind of royalty-based agreement could easily get me screwed depending on how it was structured (and the company likely has more experience than you do on drafting such agreements). For example if the royalty is based on number of licenses sold, they can just give it away for free to customers and charge them a "maintenance fee", so you would get $0. You get the idea.

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ra14y ago

Yes. Something like x dollars per customer per year would be slightly less optimised but more robust and defensible.

Don't forget that by providing you with sales / revenue / customer management they are bringing a lot of value to the table.

Who will develop the product ongoingly? Who will provide patches and support? These might seem like obvious questions to you but they must be discussed and written in a contract.

Finally, make sure your contract includes sufficient legal protection. i.e. the product has no guarantees and you are not liable for any cost, damages or loss, direct or indirect. If things go ahead then you definitely need a lawyer to help you with this.

staunch14y ago

Another huge issue is just accounting. You need to be able to check the books or they can just choose to pay you whatever they want.

A simple cash deal is probably something you can do yourself, or with very little assistance. Anything more complicated requires an experienced attorney.

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