Independent sponsors: explaining a data license to capital partners

Why do capital partners need to hear about a data license from you?

Because a data license is a non-ordinary decision at a company they co-own, and they should hear it from the sponsor, with the terms and the controls, before they read about it elsewhere. Independent sponsors raise capital deal by deal, so how you report on material decisions shapes the next raise.

A license generates a one-time payment, involves employee and customer records and carries reputational questions. Each touches something a co-investor cares about: distributions, governance or the exit story. This page sets out what to check in the documents, how the payment appears, and a short update you can adapt.

This is general information, not legal, tax or financial advice. Confirm with your own counsel and tax adviser before acting.

Which of your companies are worth raising it for?

Not every holding warrants the conversation. Screen first, so your capital partners hear about real candidates only.

The who qualifies page has the full baseline, and the company fit checker is a preliminary, non-binding screen.

What do the operating agreement and side letters say?

Check the documents before you speak to the CEO, not after. Ask counsel to read for these items:

• Major decision or consent rights: does a license of company data, or an exclusive license of an asset, need board or investor approval?
• Related-party and fee provisions: does anything you receive in connection with the company, including a referral reward, need disclosure or consent?
• Information rights: what must capital partners be told about material agreements, and when?
• Use of proceeds and distributions: how does a one-time receipt flow through the waterfall, and does it count as an operating or a non-recurring item?
• Confidentiality covenants: do customer or lender agreements restrict use of records?
• Lender consent: does a credit agreement limit asset licenses or require notice?
• Exit-related covenants: would an exclusive term constrain a sale process?

Nothing is binding until the company agrees price and terms and signs, which leaves room to take the item through the right approvals first.

How does a one-time payment show up for co-investors?

The company receives one all-in price as a one-time payment, typically within about 60 days of invoicing once the buyer selects the data. Present it as non-recurring, not run-rate. Your capital partners will likely ask three questions, and you should have answers ready.

1. Is it revenue, other income or a disposition? Accounting treatment depends on the contract and the company's auditors, so take that to the CFO and auditor rather than guessing.
2. Does it change the valuation story? A buyer may treat it as one-off. Say so, and avoid projecting repeat deals.
3. Where does the cash go? Debt paydown, working capital or distribution, according to the documents and your plan.

What are the reputational controls?

Co-investors may care as much about headlines as about the payment. Offer them the controls rather than reassurance:

• Exclusions agreed before work begins, such as private messages and HR or legal mailboxes.
• De-identification and redaction rules the company approves.
• No access to company systems for the buyer.
• Notice to employees before delivery.
• An agreement that restricts resale, contact and re-identification.

The sponsor's view on exposure is in portfolio data licensing and reputational risk. If staff objections arise, when an employee or former employee objects outlines the response, and the employee announcement template covers communications.

How does the introduction itself work?

1. You introduce the company through the referral form or your referral link, which sends the CEO to sourcex.si/apply with your code attached.
2. SourceX qualifies it on size, history, data breadth and rights.
3. The company completes a data inventory; you never export, upload or describe its records.
4. Price and terms are agreed, and buyers review.
5. If the deal closes, data is delivered and the company is paid; your reward follows only after SourceX receives its fee.

When should the update go out?

Avoid the periods when a sale or refinancing is being run without coordinating. See should we wait before licensing and licensing during layoffs.

What should the update say?

A short note the day you have facts:

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For first contact with the CEO, the operating partner page has role-specific guidance.

How does disclosure of a referral reward work?

Partners earn 25% of the eligible platform fees SourceX actually collects from the referred company's licensing deals, capped at $100,000 per referred company. Rewards become payable only after the buyer pays and SourceX receives its fee, no reward is guaranteed, and the reward is a share of SourceX's fee and is never deducted from what the company receives.

The conflict-of-interest question is yours: disclose the reward to the company and to capital partners as your documents or fiduciary duties require, and check whether it needs consent. If you are registered with a broker-dealer or are an adviser, ask your compliance team first. Read the program terms and the referral earnings calculator.

When is this not worth raising?

• The company is under 50 full-time employees at peak.
• Records belong mainly to clients or are mostly consumer or health data.
• A sale process is imminent and the buyer would object to exclusivity.
• Capital partners are already uneasy about the company's governance.
• You cannot reach an authorized sponsor.

The FAQ lists more cases.

Next step

Read your operating agreement, screen one company and brief a lead investor. If the company fits, register as a partner and make the introduction, or have the CEO apply at sourcex.si/apply.