What is copy/pasted below is an actual email sent to us by a web development company which I will call eX whY Zee. All the names (except those of the Web AddiCT(s)) have been changed. The websites referred to have been called site1 and site2. Imagine what we’d be like without Innovation? Just AddCT?
It is not possible for us to be Web Addict(s) without Innovation.
This has inspired yet another Innovation which we’ll be rolling out next year 🙂
Hi Rafiq, eX and whY,
This is what we discussed earlier today. Rafiq is going to present this to
his partners (When I refer to them collectively, I’m going to call them
Rafiq & Co. for now). If they all accept we will create a Heads of Agreement
to be signed.
This is not an agreement, but a statement of what points an agreement
Statement of Intent
* We want to give Rafiq (and others) the opportunity to utilize
their entrepreneurial abilities and improve their skills while concurrently
benefiting eX whY Zee.
* We want everyone at eX whY Zee to have 110% buy in into the
eX whY Zee dream. This model is designed to foster that.
* This is on the assumption that together we can create a far
better end product and reach more markets more efficiently and effectively.
* Together we can create powerful models for passive/annuity
Basic Points of Agreement
* eX whY Zee will attain ownership of site1 and site2
* eX whY Zee will cover all future costs for running these
products (server, hardware, software, domains etc).
* eX whY Zee will handle the business side of the new products
(the result of “Innovations”) by setting pricing, selling complimentary
services, doing the accounting and admin, debt collection and contracts.
* eX whY Zee will provide sales and marketing exposure for the
Innovations in all areas where they have a presence.
* Rafiq and Co will receive 15% royalties on site1
(they will decide on how this revenue is
split amongst them)
* Rafiq and Miguel will come and work at XYZ on XYZ premises
during XYZ working hours
* Rafiq and Miguel will be allocated time to work on XYZ clients
and time to work on “Innovations”
* Rafiq and Miguel will be paid a salary which will be reviewed
quarterly in light of the ratio of time being spent on XYZ Clients and
* Rafiq, Miguel and any other XYZ employee who has an idea for an
accepted Innovation, will earn a royalty on new Innovations created:
* The % will be negotiated per product (depending on how much of
the Innovation was originated by them)
* The sum of both of their % commissions will never be more than
15% and could be less depending on the criteria above
* XYZ has the option to sell the product if and when they deem it
* Royalties will be paid if a product is sold (i.e. the same
percentage paid on the sales price).
* XYZ will have the right to stop running a product
that they deem unsuccessful.
Let me know what all of you think.
eX whY Zee
What would you have done in a situation like this?
You’ve baked a nice pie. How about you give me the pie seeing that I am also a baker. You can have a slice for all you hard work.