What should a data broker do for you?
The short answer
A data broker should do more than pass your name to a buyer. Ryan Lock of Polyshares says a useful broker builds a records inventory, sets a price that holds up and explains the terms. That is one view from a firm that works with brokers. Ask who pays them.
A broker who only passes your name to a buyer adds little. This page covers what a broker should do for your company, what it shouldn't do, and what to ask before you agree to a fee.
What should a broker do for you?
Ryan Lock, listed as Managing Partner on the Polyshares homepage, wrote that plain introductions will be competed away as more brokers arrive (X article). His firm works with brokers, so weigh his view that way. Read as what you should get, his list has four items:
- An inventory. Each tool, the years you can export from it, and the total size.
- A price that holds up. He says unrealistic asking prices kill deals.
- Terms you understand. Exclusivity, acceptance, payout timing, scope of use, sublicensing, de-identification and liability caps.
- Plain words. Most owners have never read a data license.
He says he is not an attorney and tells readers to consult one.
Inventory
Tools, years, size.
Fair price
Ask for what holds up.
Terms
Explain each clause.
Close
What shouldn't a broker do?
- Keep quiet about who pays them. A fee from the buyer gives a broker a reason to steer you, so ask before anything else.
- Rush you past your lawyer. Nobody should ask you to sign a license your lawyer hasn't read.
- Ask for your files first. An inventory needs tool names, years and sizes. It doesn't need the records themselves.
- Name a price before the inventory exists. A figure with nothing behind it is a sales line.
How is a broker paid?
By commission or a success fee. That gives the broker a reason to close, which may not match your goal. Read data broker commission and the red flags page.
How does an advisor compare?
Our advisor page lists similar work: inventory your records, line up rights facts, match you to buyers and compare terms. See what a data licensing advisor does. The inventory template shows the first task.
What should you ask a broker?
- Who pays you, and how much?
- Do you work for me or for the buyer?
- Will you show me the contract before I commit?
- Are you a lawyer?
For picking one, see how to choose an AI data broker.
Our only referral relationship is with micro1, an AI data company. It may pay us a fee if a company we introduce goes ahead with it. You pay nothing extra. How we are paid
Have a lawyer read any contract before you sign. They like that.
Vaultfish helps you run the process. We are not lawyers and this is not legal advice. If you need counsel who knows this area, we can point you to one. Ask for a referral
