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Comment by RiderOfGiraffes | Hacker News Reader

Some people talk about getting angel investment to "guarantee" your survival, but it doesn't - really, it doesn't.

You want to put your code in escrow, and have an agreement that if your company folds, the customer gets full access (not necessarily ownership) of the code, and has the right to the engineers' time necessary to get it and keep it working.

These sorts of things are standard in some industries. Get an hour of free consultancy with an appropriate lawyer, and it will work easily. Talk to your customer and say that you are sufficiently confident to give them full access to the code in the event that you can't deliver. They get the full blast of your confidence, as well as the assurance that it will all work.

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If I was a CTO of a large company that was subscribing to a small startup's useful SaaS service, I'll much prefer the startup to have solid financial backing than having access to their code.

The hassle of getting engineers to manage the code and keep it up to date isn't worth it (with all the legal gray areas surrounding IP). That's what I was trying to avoid by going the SaaS route in the first place.

I run a small company and provide software and services to very large players in a conservative industry. We've often offered escrow, it's always been accepted happily. Hence my advice/comment.

YMMV - it will clearly depend on your industry, customer, and likelihood that there'll be a problem anyway.

How does this escrow thing work on a practical basis? Do you know any good escrow agents? and perhaps more importantly, do you charge your clients extra for providing them with a source code escrow agreement, similar to providing an SLA.

It's in the contract, and we charge for it. In effect, it's part of the service we provide.

An agreed escrow company comes in, and we prepare a clean build system. We follow the documentation to build the system and run basic system checks. We show that the binaries just built are identical to those on the customer's running system. Then we power down, remove the disk, and hand it over to the agent who seals it in a labelled bag. We sign, they sign. If the customer wants to be present, they sign as well.

There are many places where the whole thing can be faked, but we don't do that, and the agent does have some skills and abilities to detect such things.

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