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Legal Talk 24: How do I deal with a Service Level Agreement, any tips?
You call again. “Another Quick question for you Legal Coach. The customer we are selling in our software and services to, has agreed the letter of agreement! Which is fantastic news, but they said that they need an SLA (Service Level Agreement). What is that?” You ask. Well, the SLA is just an agreement where you agree to certain service levels that you have to meet or exceed. If you fail to do so then normally there are "penalties" (in the form of service credits or compensation payments) that you have to pay the customer. SLAs are quite useful because they set the benchmark to be attained. Here's another link for another definition! https://www.techopedia.com/definition/24420/service-level-agreement-sla There is a knack to drafting SLAs though. From your point of view, you don't want to pay penalties to the customer and so it is a good tactic instead to suggest that if things go wrong that you will put together an action plan to put things right, but importantly, that you won't pay back any money. You can get templates for SLAs on the internet and I can cast my eye over one once you have added details of the customer and product etc. “Is there any kind of checklist that I should follow?” You ask. Well, I suppose I can provide a few tips here: 1. Set your own Service Levels: Get information from the customer as to what kind of service levels they are expecting. Normally the customer will not have measured this before internally. and so maybe it is a good idea to propose your own service levels as a starter because at least you know you can meet these. 2. Set just a few Key Performance Indicators (KPIs): Try to suggest just 3 or 4 KPIs to meet and set ones which you are confident of achieving. Just a few KPIs are easier to focus on for both you and the customer and is easier for everyone to administer and check. 3. Business focus: Try to negotiate the SLA with a business focus rather than just a legal focus or an IT focus. Essentially if the KPIs in the SLA are met or exceeded then you should have a happy customer. 4. Keep it short & simple: SLAs often go wrong because they are too long or too complex. In either case, the SLA is typically shelved and the account managers for both customer and supplier just deal with problems on an ad-hoc basis. The problem with this approach is that there is no consistency and it is hard for anyone to figure out later on how problems have been dealt with. So, making the SLA really simple and sticking to it is critical. Of course, it should be used as a flexible document and so if it turns out that it needs to be changed (either because the KPIs are too stringent so you will never achieve them or too lax so that you could achieve them in your sleep) then you should be able to talk about and change the SLA as the project moves forward. 5. Lawyer check: I can cast an eye over your SLA once you have drafted it but anything more than a few pages and it will start to get too complex and you risk no one ever looking at it again. 6. Upsell: Often my start-up and larger clients use the SLA as a marketing tool because it is a great way to meet your customer, flush out problems that your customer might be having and then suggest other solutions or upsells to what you are already providing to your customer. What you might find is that your customer will really welcome your ideas and input as to how they can make things better for themselves. This may result in more sales for you “Thank you for the tips! By the way, have you got a template that I can use?” You ask. Yes, I say. I thought you might ask for that. If you fill in the template then I will check it, and you can send it over to your customer for signature. You say that this is going to help a lot and that once you get this customer on-board you will use the same process with new customers. Fantastic! I’ll get to sending you that template then. With best wishes, Jimmy Desai Your Legal Coach P.S. Don't forget to subscribe and get even more exclusive content and legal insight. As always, this legal talk and all the legal talks are subject to our disclaimer, which you can find here. © 2019. Coaching Law Limited. All rights reserved.
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Legal Talk 23: Database Rights: What You Need to Know
You call with a quick question. “What are database rights?” You say. Ah, yes. Database rights are rights that are created automatically when you create a database. They help you to protect your rights in that database from being copied by other people. “So, do I have to do anything to register these rights?” You ask. No, I say. You don't need to register these rights. However, there are a few things that you need to know about these rights: 1. To get database rights in your database you have to show you have put some effort into creating the database (e.g. the way that it is formatted and set out in different fields etc.) 2. In particular, you have to show that there has been a substantial investment in obtaining, verifying or presenting the contents of the database. Best to keep a record of everything you have done to create that database so that if anyone questions whether or not you have put in substantial investment into creating the database you can show you have. 3. If you can prove you have database rights in your database then people will infringe your rights if they copy all or a substantial part of your database, or if they take little bits of it on a regular basis so that this all amounts to taking a lot of your database. 4. Database rights last for 15 years, which is plenty of time given that your database is likely to be out of date by then. Anyway, the good news is that the 15 years re-starts if there is a substantial change to the database. So, a lot of people save up their changes to the database and make them all in one go so as to get another 15 year period of database protection for the new updated database. 5. You can also get copyright protection for your database regarding its contents. Best to put copyright notices on your database and also state that this is your database and that you believe that database rights protect it. 6. Also, if you put in some deliberate (but harmless) errors into your database then if anyone copies your database, they will also copy the errors. Then, if you suspect them of copying your database and write to them about this, it will then be up to them to explain how these errors appear in their database. “Okay,” you say. “This database is pretty important for us because it has all of our contact and client information on it so these database rights are good to know about because we need all the legal protection we can get for this database.” You should also put a note about database rights in any presentation that you make to investors just to show them that you are on top of things. If you want to do any further research, here might be a good place to start: https://www.out-law.com/page-5698. I am thinking about going into more detail on database rights but you say you have to go because you are updating your pitch deck to investors. Hope all goes well with the fund raising! As always, I'm continuing to think of ways that I can help you on the legal side. Best wishes Jimmy Desai Your Legal Coach P.S. Don't forget to subscribe and get even more exclusive content and legal insight. As always, this legal talk and all the legal talks are subject to our disclaimer, which you can find here. © 2019. Coaching Law Limited. All rights reserved. Legal Talk 22: Do I need to sign an IP assignment?
We’re meeting for a quick drink in Farringdon. One thing that has been puzzling you is that people in TechHub have been talking about IP assignments. You don't really know what this is or why you need it. You were wondering if I could shed a bit of light on this. Okay, I say. It's pretty simple really. As we have talked about before, IP (or intellectual property) is all of your ideas which you have written down. Some of these written down ideas you might have protected via patents, trade marks, copyright etc. When investors are looking to invest in a company, one of the key concerns is who owns all the ideas, you or your company? The thing is that they are investing in your company and so they will want to see all of the ideas (and all the associated IP) vested in your company, and not vested in you as an individual. “Why?” You say. Well, the IP is a company’s brand value and if they are putting money into your company that is what they are paying for and so they want to see that IP in the name of your company. Also, they want to make sure that if you ever leave your company (on an exit or for any other reason) that you don't walk away with the IP and use it yourself or take it to another company. In order to get this all done legally, they will ask you to sign an IP assignment, which is basically an IP transfer that will transfer the IP ownership from you to your company. “Got it,” you say. “Do I have to do this?” You actually would like to hold on to your IP if you can. Unfortunately, investors will most likely insist on this if you want the money. "Oh," you say. “When should I do this?” Well, I think the best time to do this is early on because at least when the investors ask you about this point you can say that you have already got it sorted out. There are lots of IP assignment templates on the internet that you can use. Again, if you use a template, I can cast my eye over it and see if it is okay from a legal perspective. You can then sign it and at least that’s one more thing sorted out. In the meantime, here's some weekend reading that I enjoyed greatly: https://www.rocketlawyer.co.uk/documents-and-forms/assignment-of-intellectual-property.rl#. “Great, it seems pretty straight forward,” you say. It's gotten pretty crowded and we say our goodbyes. Looking forward to hearing how things go with you. Always thinking about how I can help you on your company journey from zero to IPO! Best wishes Jimmy Desai Your Legal Coach P.S. Don't forget to subscribe and get even more exclusive content and legal insight. As always, this legal talk and all the legal talks are subject to our disclaimer, which you can find here. © 2019. Coaching Law Limited. All rights reserved. |
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