Spacewell Cushman & Wakefield Partnership
In 2011 Koen Matthijs and Steven Lambert realized a management-buyout of MCS Solutions. MCS Solutions, acquired by DAX-listed Nemetschek in 2018, is a Smart Building Technology provider with over 25 years of industry experience in more than 60 countries.
In 2018 MCS Solutions entered into a new global value-added licensing and partnering deal with Cushman & Wakefield, a leading global real estate services firm.
The purpose of the partnership is to bring together expertise in many areas of real estate, workplace, and facilities management – ranging from the comfort of a building occupant to catering, technical maintenance, energy management, space optimization, and smart working among others – and to allow clients to have a greater positive impact on the occupants’ experience and control over their building portfolios enabling the ability to turn big data into actionable intelligence.
Koen Matthijs, currently Chief Division Officer, Operate & Manage Division at Nemetschek, shared the following insights regarding value-added licensing strategies:
• Standard product suite vs custom developed apps: a clear distinction needs to be made in respect of standard product suites and any applications specifically developed for a value-added licensee. Specific arrangements need to be made in respect of the development and ownership of such custom developed apps.
• EULA and usage restrictions: the value-added licensee is likely to resell or distribute the product suite to a roster of clients as part of a broader product and service offering, consisting of hardware and software solutions, other resources and services. It is key for the licensor to ensure that the terms and conditions applicable to its stand-alone product sales to end customers are pushed through by the value-added licensee as part of its overall service offering, ensuring the licensor is able to control the terms and conditions applicable to its indirect product sales.
• Intellectual property: intellectual property ownership needs to be vigorously safeguarded, with full IP ownership of the standard product suite being non-negotiable and a strong preference to retain IP ownership for custom developed applications. To ensure ownership of such custom developed apps, it is often unavoidable to concede temporary exclusivity or apply significant discounts to the custom development cost.
• Roles and responsibilities: clear arrangements need to be made in respect of the roles and responsibilities of the licensor and licensee, included but not limited to service levels to be adhered to towards the end customers. Small companies need to be acutely aware of the 24/7 service levels required by large corporate clients, in particular those clients which integrate the product into a broader product offering. It is key to establish a relationship forum to discuss the division of such roles and responsibilities and the potential modification of such roles depending on lessons learned.
• Stability – escrow and transition arrangements: large corporate customers are understandably concerned about the stability and continuity of smaller providers, in particular if such corporate integrate the product suite as part of a global product and service offering. Escrow demands allowing the corporate to take control of the source code for the purpose of continuing to serve the end customers in the event of stability or continuity issues are not unreasonable but require careful consideration. Likewise, appropriate arrangements need to be made to ensure that (active) end customers can continue using the product suite upon termination of the value-added license, irrespective of the circumstances of termination, at the condition that agreed upon end user license fees remain paid by the licensee to the licensor.
• Liability and indemnification arrangements: in view of the integration of the product suite into a broader product and service offering which the licensor does not control, it is absolutely key to ensure that the liabilities and indemnification obligations of the licensor are limited. Liability caps, limits on consequential damages and appropriate exclusions for those matters not under the control of the licensor are i.a. key.