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Rohit Malhotra

10mo ago

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Ensuring Fair Revenue Sharing in SaaS Co-Creation Deals

Fair revenue sharing is critical to SaaS co-creation success.

  1. Define ownership and roles from the start.
    Many partnerships fail because responsibilities and equity splits are unclear. Decide early on who owns what, from intellectual property to revenue streams, to avoid disputes down the line.

  2. Use measurable metrics to allocate revenue.
    Fairness is subjective without objective benchmarks. Tie revenue sharing to tangible outcomes like customer acquisition, product development efforts, or resource investment to maintain balance.

  3. Revisit the agreement as the business evolves.
    What seems fair at the start may become outdated. Regularly review and adjust terms based on changes in contributions or business performance to ensure ongoing equity.

  4. Beware of power imbalances.
    Larger partners may try to dominate revenue-sharing agreements. Protect smaller partners by establishing safeguards, such as minimum revenue thresholds or profit-sharing caps.

  5. Involve a legal expert to draft the agreement.
    Many SaaS co-creators assume trust will protect them. A clear, legally binding contract ensures all parties adhere to the agreed terms, even if relationships strain.

  6. Communicate regularly to prevent conflicts.
    Misunderstandings on revenue sharing are common. Set up periodic check-ins to review progress and clarify expectations to maintain a collaborative environment.

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