SaaS contracts
Should a startup write its own SaaS paper or sign on customer terms?
A startup should write its own SaaS paper and lead with it, as long as a sales rep can actually send it. At Charlotte Corporate Counsel, I draft the SaaS agreement as a revenue document: the reasonable concessions are already in the first draft, and the terms where margin lives stay fixed. Sign on customer terms only when a large buyer won't use yours, and price every clause before you do.
What signing the buyer's paper really costs you
Your rep wins the deal. Then the buyer's procurement team sends its own master agreement and asks you to sign. Every clause in it was written to protect the buyer, and nobody on your side has priced what it does to your margin.
The damage rarely sits in the liability section everyone argues about. It sits in the clause that quietly moves margin, payment timing or collection risk: longer payment terms, a renewal price you can't raise, service credits that eat a month of fees. Sign enough customer paper and every account runs on different terms, so your team tracks obligations one deal at a time.
Why a template and a redline playbook don't fix it
You've heard the usual advice: keep a standard agreement, lead with it, and give sales a list of redlines it can accept. That's sound as far as it goes. But most startup templates open at the most protective position, so the buyer's lawyer marks up every page. The playbook sits in a folder your rep never opens mid-call.
So I draft the agreement as the document your rep sends and your buyer signs. You decide before the first deal what you'll give, and that goes straight into the base terms. You also name the few terms you won't move, because that's where your margin lives. The buyer's lawyer sees a reasonable first draft, and the negotiation shrinks to those few lines.
A founder and CEO of a SaaS company put the result this way: “Charlotte rewrote our SaaS agreement so our sales team could actually use it. Deals close faster, and I sleep better knowing the risk is handled.”
When should you sign the customer's paper instead?
Sign theirs when the buyer is big enough that its procurement team won't work from vendor paper, and the deal is worth the extra review. Arguing over whose template to start from can cost you a quarter. Just don't start redlining until you've compared each clause to what your own paper would have said.
That comparison tells you which three or four changes matter and which you can let go. If a buyer's agreement is on your desk right now, tell Charlotte about your deal.
What to do before your next enterprise deal
These moves work whichever paper you end up signing, and you can start on them this week.
- List what you've already given away.Pull your last three signed contracts and note every term your team conceded. Those are your pre-concessions.
- Write them into your base agreement.Put them in the first draft itself, so a buyer's lawyer sees them before asking.
- Mark the terms your rep can't move.Pricing, payment timing, renewal and the liability cap against fees. Anything there comes to you first.
- Price customer paper before you redline it.For each clause, ask what it does to margin, when you get paid, and whether you can collect.
Working on something like this? Tell Charlotte about it.
Tell Charlotte about your deal
Read the full argument
My essay on writing the SaaS paper a sales team can actually use makes the whole case for treating your agreement as sales equipment.
- Which clauses in a SaaS order form cause the most negotiation cycles?Where the redline rounds pile up, from the same essay.
Charlotte Lynn Luu
Fractional attorney for technology startups and growth-stage businesses, Charlotte Corporate Counsel
Charlotte is a Georgia-licensed attorney who drafts and negotiates SaaS agreements, master service agreements and enterprise deals for technology companies. She practiced at Baker Hostetler, Baker Donelson and Kutak Rock before launching her own practice.
