We represent lots, literally 100s and 100s, of SaaS companies and there are a few nuggets of useful information that we want to share with other SaaS companies when they think about negotiating an enterprise SaaS agreement. Ok, here goes.
- Setting the Right Expectations. I find that setting the right expectation of what the customer is buying is the #1 issue in any SaaS enterprise agreement negotiation. Enterprise customers notoriously want things their way or customized for them (and if you ever read their form agreements you will see what I mean), but in the SaaS world it does not work that way (i.e. everyone gets the same thing for a very low price). So make sure as part of your marketing and selling process you set the right expectations that your customer is getting what everyone else is getting.
- Price and Terms Are Linked. This is a high level issue, but is super important. Think of it this way: when you give an enterprise customer a price quote, it is based on (a) your pricing model and (b) your standard SaaS agreement terms. If you fail to explain this or educate them about this, then you may find that your enterprise customer may get the wrong impression and assume that you can give them whatever they want for that price. The only way to combat this is to tell them that if they want to change the ‘terms of the deal’ then the price will change too. So, in