Member
Joined: 02/05/2007
Licensing gurus:
Appreciate if any one can give me some insights into the following situation:
We are "cash-strapped" startup (which startup isn't?, initially). We recently got a patent issued from USPTO. We have been engaging a major online services company which provides services to a mutual customer (for us the customer is still a beta-customer) for over a year.
Finally, they offered to license our technology but not our code or integration into our platform for some security reasons. It is very clear that they are interested in IP but not our s/w and probably for this reason they have been waiting. Our typical licensing to direct customer would an annual license $x/yr/user.
Besides this, we have huge market on several verticals.
I have some concerns and some ideas (crazy) on how going about..
Concerns:
a) Our product is designed with some secret sauces so as to make our product/solution universal (else also works but we lose control and make a fuss of differerent implementations that end users get tired and eventually dont use our solution).
What can be done here while negotiating?
b) We dont know whats their time line to implement our technology. If we leave it open, they may not implement quickly that we may not get license rev immediately. Our idea is to get some cash to boot strap our startup and count the license rev later.
What is the best way or some options here?
c) They asked to open up our code so they can implement cleanly on their platform.
What are some caveats here?
d) If the licensing is based on volume of end-users, what sort of audit clauses we need here?
e) How can we make sure, there is no pricing clash (their's towards end customers vs. ours towards end customers (not necessarily mutual customers)
what would be the main ones that we need to touch upon during first meetings?
any pointers, thoughts, highly appreciated.
Thanks a mil in advance for answeing.
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