Tips for the Developer
How Source Code Escrow Can Work for You
Source code escrow offers more than just security and protection.
A source code escrow enhances your product with many value-added
benefits, all of which have the potential to translate into profits
for your software business.
Meet your Customer's Needs
A source code escrow provides a cost-effective solution to your
customer's basic concern: How will the software be supported if
you go out of business? By escrowing the source code in advance,
you can anticipate and answer a licensee's need for long-term software
support and maintenance. Source code escrow will give you the edge
on your competition by winning the trust and confidence of the customer.
Simplify the Sales Process
Customers will be more likely to buy your product if you make it
easy for them to do so. Establishing a source code escrow can speed
up the overall sales process, increase your earnings potential,
and avoid delaying the licensing process. Your customers will appreciate
the lack of time-consuming paperwork.
One Deposit - Multiple Users
For each product, you only need to deposit the source code materials
once. After that, new customers can easily be added as licensees,
saving both you and the customer time and money.
Collateral for Financing
Source code escrow may be used as collateral for securing a loan
from a bank or lending institution. Many banks today will not loan
money to a software developer without a source code escrow. In fact,
many developers had never heard of source code escrow until they
applied for a loan. An escrow gives the bank necessary access to
your property should you default on the loan. It's a good idea to
have an escrow established before you approach a bank for a loan.
A source code escrow can generate revenue for you as well. Having
the customer pay for the cost of escrow is now considered standard
practice. Because a source code escrow is essentially an insurance
policy, the customer accepts the financial responsibility for this
benefit. There are several ways to make The Archive's escrow services
profitable for you. You could include the cost in your license agreement
or mark up your wholesale price. Some developers bill their customers
annually for an amount that is a percentage of the license fee,
while others bill a fixed amount as part of their maintenance fees
each year. The opportunity to turn a profit exists. Just how much
is up to you.
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or email us at firstname.lastname@example.org.