
Ask HN: How much commission should I pay? - rjsanders
So here’s the story. I have been working on a product (just on paper, no customers) and a very good friend, who is working as a consultant with a large company (500 employees), approached me with some of the problems his company is facing.<p>We had some discussions and I decided I would change directions with my product, try to solve the company’s problems and sell the solution to them. My friend is ending his contract to pursue his own product but said he would help me get the product into the company before he leaves but he’d like a commission.<p>My friend has been very helpful in providing information about the company’s problems and I’ve used that to design the offering. He has won over some key stakeholders, of which some are good friends of his, and he is confident the product will be sold into the company as a result of his efforts. My part will be flying over to give the final pitch, sending through the formal proposal&#x2F;contract and of course delivering the solution. He will push to move forward with the solution internally but won’t be involved after the contract is signed.<p>The most recent deal we had on the table was 40% of the upfront setup project and 35% of the annual contract value with 15% paid on signing and the rest paid over the contract term. The deal we’re trying to get with the company is 27k upfront and 4.8k monthly with an annual commitment.<p>My question to HN is how much commission should I be paying? And, is the deal on the table fair or competitive?<p>Thank for any help HN!<p>(edit)
Just wanted to add that we have been talking several times a week and he has had several meetings with stakeholders to highlight the need for a product like this and to defend the strategy&#x27;s merit. I want to be clear that he is quite involved although he is still working for them as usual for them.
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xky
What is your margin?

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rjsanders
To be honest, I don't have it all worked out but I doubt there will be any
profit here. The value I see is mostly the learning from working with a real
customer and having the product build partially subsidised.

