Sofware selling - need help!

[Bruce Lee]

A leading mobile provider is looking to buy my midp application so they can
put it on phones in their market. They say it can either revenue share or
outright sale. I'm looking at revenue share what kind of percentage would I
be looking at here? Thanks a lot

 

[Sudden Disruption]

Bruce,

I'm looking at revenue share what kind of percentage would I be looking at here?

The first rule of negotiation is to let the OTHER guy show his hand
first. You need to know what HE things your product is worth both flat
rate and cut of the take.

There is no quick and accurate answer without knowing a LOT more
information, but the other approach (which should have been done before
creating the product) is to assess the market, price point and probable
share capture as well as cost of production and marketing.

This will leave gross and net profit and you can work backwards into
your royality stream.

OK...

The quick answer is 2 to 20%.


Sudden Disruption

 

[Mark Space]

A leading mobile provider is looking to buy my midp application so they can
put it on phones in their market. They say it can either revenue share or
outright sale. I'm looking at revenue share what kind of percentage would I
be looking at here? Thanks a lot

My gut reaction is that net revenue can be a slippery subject. All the
company has to do is claim that it lost money on the product and you'd
get nothing. Many popular musicians made little from sales of their
products because the record companies took out such a large percentage
for marketing and distribution.

In my experience, smart inventors charge a flat rate per sale. $0.25
per sale, $0.10 per sale, even one cent per sale could add up to a lot
if the numbers are high. (If the numbers are large, like over 100,000
per month, expect $0.25 per device sold to be very high and probably
right out.) Important hint: find out what sales numbers they are
projecting.

You could always go with a combination. $$$ up front and $ per sale.
Money now is always good money. Remember Wimpy was always happy to pay
on Tuesday for a software product today.

Don't forget to ask your tax accountant for advice also.

 

[Luke Webber]

A leading mobile provider is looking to buy my midp application so they can
put it on phones in their market. They say it can either revenue share or
outright sale. I'm looking at revenue share what kind of percentage would I
be looking at here? Thanks a lot

Make sure to set some minimum performance level at which they lose the
right to sell it. All you need is for them to pick up a competing app
and leave yours on the shelf gathering duct, in the calm and certain
knowledge that they own the world rights to (not) sell it. Or even just
for them to do a poor job of marketing it and getting it to the sales
channels.

Luke