Software Sales & Marketing Deal Structures?

Entrepreneurs asks: "My business partner and I run a small but growing software company. For approximately the past two years, we have been collaborating with some outstanding overseas developers, have established a strong relationship with this group, and plan on continuing our collaboration with them in the future. As a means of jump-starting our business, we have entered into discussions with this same group regarding some would-be sales and marketing deals in which they would develop and support some products while we would be solely responsible for sales, marketing and would bear all costs associated with these activities. Both parties are in essentially in agreement as to the overarching roles that would be played, but we are as yet far apart in regards to our respective perception as to what represents a fair deal structure (% revenues) for the developer as opposed to the sales/marketing partner. What wisdom can Slashdot readers offer regarding the typical structure of software sales and marketing agreements?" "Previous experience in the biotechnology industry (an industry that I argue shares several similarities to the software industry) tells me that sales/marketing partners typically get anywhere from 60 to 75% of topline revenues, with the remainder going to the development company. Our overseas partners are essentially arguing for the exact opposite, something to which we would never agree, as we believe it would represent an abandonment of our fiduciary responsibilities. Having never negotiated a deal such as this, we are somewhat at a loss as to what the industry standard terms are for situations such as this and have had a difficult time obtaining quality information that addresses our situation."

Comments

Here's some advice for you:

[TheGrapeApe]

"My business partner and I run a small but growing software company." ... "They would develop and support some products while we would be solely responsible for sales, marketing"

It sounds to me like what you're _really_ running is a marketing company for offshored programming.

So I'm going to give you the kind of advice you might expect from posting in a place where the primary audience consists of "on-shore" programmers that have watched their quality of life get torpedoed by marketdroids patting themselves on the back for trading our jobs, standards of living, and our nation's economic backbone overseas:

Go jump off of a cliff.