Master Service Agreement


Master Service Agreement

What is a Master Service Agreement?

An MSA is an agreement between your startup and a client who will be using your SaaS product regularly. It's like a playbook, outlining the main rules of your business relationship.

For instance, if your startup offers a subscription-based project management tool, an MSA with a client company sets the groundwork. It covers aspects like how they'll pay you, what happens if there are technical issues, who owns any data generated, and what happens if there's a disagreement. By having an MSA, you don't need to negotiate these points for each new project or renewal, and you can swiftly adjust to changes as your business grows.

Who are the parties in a Master Service Agreement?

"Service Provider" - the one offering and delivering services

"Client" or "Customer" - the one receiving and paying for the services

What are the risks when signing a Master Service Agreement?

Not reviewing a Master Service Agreement (MSA) thoroughly before signing can leave your business exposed to a variety of risks. For instance, inadequate protection of intellectual property rights might lead to potential losses of ownership over your own technology or processes. Similarly, discrepancies in liability provisions could result in your business assuming more risk than necessary.

Payment terms need to be clear to prevent disputes over pricing, timelines, and payment methods down the line. Without robust confidentiality provisions, your sensitive business information could be left insufficiently protected.

A lack of defined dispute resolution methods could lead to challenging and costly processes if disagreements arise. Moreover, the presence of overly restrictive or broad obligations can either limit your business activities or make you accountable for more than you initially intended.

Lastly, the absence of termination provisions can potentially lock you into an unfavorable contract for longer than desirable.

Use Docsum to review an MSA meticulously before signing to safeguard your business interests.