
Ask HN: Client has critical SaaS with an egregiously bad TOS – What do? - samstave
I have a client with whom I am consulting on sonme things, and their entire production operation is tied to a single, very small SaaS startup which developed a product explicitly for their industry&#x2F;market niche.<p>Its a nice product and meets their needs, but it is literally a single-founder SaaS startup, and from what I can tell, run from a small GCP...<p>However, the TOS for their product is laughably bad, IMO.<p>It indemnifies them of any and all risk for any reason, claims to own all data in the system, literally has the line &quot;USE THIS SERVICE AT YOUR OWN RISK&quot; - claims to bind user to agree to only use San Francisco courts, but then states that any and all arbitration must be held in NYC. (California based client and SaaS provider)<p>Basically, the TOS, which I would expect to be boiler-plate-ish protecting the SaaS, is just way over stepping reason.<p>The client cant easily (affordably, technically) get out from this contract - but I don&#x27;t know how to broach the subject.<p>The TOS essentially makes it such that if this single person srtartup were bought by a competitor in this extremely booming industry vertical, that they can yank the system at any point, without notice, and without compensation - access to data.<p>Anyone have any advice?
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gtsteve
Your question is how to bring this up with your client?

I'd either call a meeting or send an e-mail depending on the sort of
communication culture and draw their attention to what would seem to be a risk
to their business. But just pointing out the problem doesn't help unless you
have a plan.

I would deal with this by calling up the founder directly to explain my
concerns, after discussing it with the client. I would ask the founder of the
SaaS for:

1\. A copy of the software to be deployed into a GCP account I control

2\. A source code escrow agreement - if certain conditions are reached
(bankruptcy/founder's death) then you gain the source code and a license to
it.

Of course, I would expect to pay a lot for this but it's worth it as
apparently this is a mission-critical piece of software.

You could frame this as an "enterprise" deal. Tell them what you want and ask
them to go away and give you a price. I'd expect that the price to be cheaper
than developing it and porting it yourself.

But then, thinking outside the box, you could bring up another idea:

3\. Discuss the possibility of acquiring the product. If it's vital after all
then it might not cost all that much, relatively speaking. If your client has
the means, $1m might not be much to them but it should be cheaper than
developing the product, porting the data and operating it for a time.

Then your client gains a new revenue stream, a new (apparently very skilled)
employee and the founder of the product gets a life changing amount of money.
Everybody is happy.

