SaaS Escrow

A source code deposit can be complete down to the last file and still be impossible to build. The reason is usually something the depositor’s own developers rarely think about: the commercial compiler licensed to their build server, the reporting library purchased years ago, the plugin pulled from a vendor’s private repository, or the managed

In late June 2020, small business customers of ScaleFactor, an Austin-based bookkeeping and finance platform, learned that the company was suspending most of its operations. They had roughly two months to move their books, payroll workflows, and financial history somewhere else before the company closed its doors at the end of August. Two months sounds

Picture a Monday morning when a critical SaaS supplier misses a payment to its cloud hosting provider. There is no public announcement and no insolvency notice yet. The hosting account is simply suspended, and the platform your teams rely on for billing, case management, or customer onboarding stops responding. This is exactly the scenario their

Ten years ago, most escrow conversations started with one question: where does the source code live? Today, the more pressing question is where the software runs, who controls that environment, and how quickly a business could keep it running if the vendor behind it suddenly could not. That shift captures the direction of the entire

Ask in-house counsel which part of a software escrow agreement took the longest to negotiate, and the answer is nearly always the release triggers. Insolvency, cessation of trade, failure to support, change of control – these events are debated line by line because they decide when the beneficiary gains access to the source code. Far

When a medical device manufacturer licenses software from a small, innovative developer, it gains a capability it could not easily build on its own. It also takes on a dependency that rarely shows up in a product roadmap: the ongoing ability of that developer to maintain, patch, and support the code. Most of the time,

The clinical champion loves your product. The pilot results are strong, the department head has budget, and the contract is almost ready for signature. Then the hospital’s procurement team sends over its vendor risk assessment, and one item asks something you haven’t planned for: does your company maintain a software escrow agreement, and could the

A procurement leader opens a renewal notice and finds a price increase twice the size of last year’s, along with a short note citing rising component, hosting, and labor costs. The increase itself is manageable. The question it raises is harder to answer: if this vendor is feeling the impact, how stable is the software

Ask in-house counsel which part of a software escrow agreement took the longest to negotiate, and the answer is nearly always the release triggers. Insolvency, cessation of trade, failure to support, change of control – these events are debated line by line because they decide when the beneficiary gains access to the source code. Far

Most enterprise risk registers contain a line that reads something like this: a critical software vendor ceases operations or stops supporting a product the business depends on. The likelihood is rated low. The impact is rated severe. And in the response column, someone has written a single word: transfer. That word carries a lot of