Author: MB Software Solutions, LLC
Posted: 2011-04-22 at 15:48:13
On 4/22/2011 5:11 AM, John Weller wrote:
> I think the partner's suggestions are good ones. They are certainly what I
> would want if I had bought a half-share of a business which was as dependent
> on a piece of software as his appears to be. I was a one man band until I
> retired and was very concerned about what would happen to my clients if I
> were to have a bad car accident or a heart attack and was unable to support
> them. If the written agreement was couched in suitable terms you could
> still retain 100% control over the software.
>
> It is common practice to provide an application for a down payment plus a
> licence fee at annual intervals for which the client gets a certain level of
> support and any upgrades for free. I would drop the notion of it being a
> beta product and deliver a version containing all of the working parts as
> version 1.0 (say) for a nominal sum. There would be a licence fee, paid
> monthly, which would expire at a specified date, usually 1 year from initial
> installation. You could have a routine which requires a new key to be
> applied after a year perhaps. You would then use the monthly licence
> payment to fund any support for the application with the surplus used to
> fund development.
>
> Obviously you would want to market this application so include in the
> agreement the facility to use the business as a reference site to
> demonstrate the application. As an incentive you could offer them a portion
> of the first year's licence fee for any new client they brought in.
>
> HTH
Ditto what John said. You can charge them a usage/license fee and
retain 100% ownership. Offer to put the source code in escrow but be
clear about the terms. Get the right legal wording for that. Look into
g2data.com for escrow. I don't use an escrow yet but would consider
them if I did. Customer pays 100% of the escrow cost...not you. Get
some $$$ for your efforts now. You'll be good! Sell the idea that they
are getting a great deal and it's a mutually beneficial agreement. As
much of a toolbag as the new partner is, you'll have to lose that
because it will only hurt you.
--
Mike Babcock, MCP
MB Software Solutions, LLC
President, Chief Software Architect
http://mbsoftwaresolutions.com
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