I have reached out to a startup in hopes of forming some sort of partnership/becoming a reseller. Our initial 90 minute conversation went very well. I would be able to reach markets that they would have difficulty in do, due to various connections I have established as well as barriers of language, culture and geography.The ball is in my court and they have asked that I propose something on how we can collaborate i.e financial structure. What kind of agreement that wouldn't come off as too aggressive that would help us both arrive to a win-win solution. They're priced as a SaaS.
To be realistic you both need to have a real understanding of at least the cost of acquisition today and lifetime value for a client (including time period). If you are just acting as a sales rep for them essentially and they own and manage the customer after you get the customer signed up, then that is different then if you own the customer and the support. If language and culture are an issue, then likely you'd own the support and so the cost should be an on-going cost.<p>The most common method for referrals is typically a one time payment but then the SaaS company owns the client and all support. For this they will want to keep the CoA to a point they can make money over the life of the client. You need to understand the current pricing for clients to know how to price this fairly. Hard to give you much of an idea, but I have seen for large enterprise style agreements where the referral payment is equal to 1-3 months of service or when values are smaller, 1 year of service. It is so dependent on type of customer and LTV etc that it is hard to be general.<p>Second option is if you own the customer because of support etc, then you would have on-going costs and so typically a percentage of revenue is more fair for the life of the customer. This is almost more like a reseller's agreement than a referral/sales agreement.
Are you going to do a one time sell based on your contact and then move on from that client or will you be the one doing customer support and maintenance going forward ? If the former, then ask for a percentage of the sale for say first 12 months. If latter, then the SAAS company could charge you a subsidized price and you add your own markup to sell to your client.<p>I run a SAAS company and thinking about introducing a reseller program so this is an interesting topic for me as well. As a SAAS founder, I would love to connect with resellers and if they just want to send us clients after initial demo and sell, I don't mind giving up to 30% of the recurring revenue for first 12 months.<p>But you need to think about the legalities as well and some other stuff like will you have access to the SAAS directly that you can install/host yourself or will it be installed/hosted for you per client etc ?
<i>What kind of agreement that wouldn't come off as too aggressive</i><p>In business to business, nobody gets offended when someone else expects to be paid (except people who don't plan to pay, but that's another story or two). In B2B the price is the price. Figure out what you need to charge to make enough money to make it worth your while in the long run. That's actually easy enough to be done in a few hours. Spending time coming up with the perfect price for a one off deal is a waste of time. It's a way of avoiding rejection. Throw a number at it. If it's in the ballpark the deal will move forward. If it's not in the ballpark, plus or minus fifty percent won't make a difference. Good luck.