Tips & tricks for happy software development, deployment and licensing.

    Source Code Escrow, saas escrow, data escrow

    Your FAQ’s on Data Escrow, SaaS Escrow and Source Code Escrow answered by Codekeeper

    Table of contents:


    Data Escrow, Saas Escrow, Source Code Escrow, it can all get a little confusing, this is why we accumulated all the frequently asked questions straight.



    Data Escrow

    What is Data Escrow?

    Without the necessary data, it is immensely hard to bring and keep a software application in a usable and useful state. Data escrow is an effective way of ensuring that any data created and managed by a business-critical software application is never at risk of being lost or inaccessible.


    Specifically, by deploying data escrow, the application's end-user (licensee) ensures they are always able to access the most up-to-date copy of the data they need to operate critical functions and ensure business continuity. The data in escrow can only be released to the licensee under predefined (and verified) conditions, such as in the event of a natural disaster or their licensor running out of business.


    What does Data Escrow mean?

    Data escrow is a specialized data protection solution designed to maintain the safety and integrity of data essential to the proper functioning of a mission-critical software application.


    Who is data escrow for?

    Any company that builds software applications and their clients. While data escrow is not intended to replace operational backups, security-minded companies that commission software use data escrow to bolster their risk mitigation. Software developers, on the other hand, use it to boost sales by strengthening their business case and providing more value to their clients.


    Why do people use data escrow?

    When you build and use a software application, you create data. There is no way around it. And this data can be stored in environments where software is deployed and executed, including databases in different physical locations, asset stores like AWS S3 and Microsoft Azure, in-memory databases, and many others. In case critical data suddenly becomes inaccessible for any reason, your software application would lose its normal functionality.


    What can cause data loss?

    Data loss occurs when data is accidentally deleted or something causes it to become corrupted. Viruses, physical damage, formatting errors, or a combination of these can render data unreadable by both humans and software, posing a risk to the financial health of businesses of all sizes.


    Enterprise, Source Code Escrow

    The Ultimate Guide to Software and Source Code Escrow - Chapter 2


    Who’s who in a software escrow agreement?

    We use the following terms interchangeably throughout this article:

    The licensor is typically a software developer or vendor who deposits source code and other materials into escrow. They're also referred to as the depositor. The client, or the authorized end-user, is typically  referred to as the beneficiary or licensee. A neutral third party, such as Codekeeper, typically serves as the escrow agent, providing secure storage of the source code and other materials, and making available (releasing) the contents of an escrow account to its beneficiary (or, beneficiaries) — upon a release condition being met.



    Depositor or Licensor

    Typically, the depositor/licensor tends to be a smaller software development team in comparison to their beneficiary counterpart. Once one of their clients begins to rely more heavily on their software for operations, concerns usually arise over the continuity and security of that system. 


    During renegotiation of their licensing agreement, the client might request that the system in question be deposited into escrow. Should any adverse, unforeseen event take place, the client will be able to retrieve the valuable code and IP, and resume operations as usual.

    These smaller development teams can also use software escrow as a selling point for their services, reassuring potential clients that if anything happens to the firm, the IP is secure in storage, up to date, and ready to be released once a trigger event takes place. 

    Enterprise, Source Code Escrow

    6 Tips for Securing Your Development Outsourcing


    If you’re thinking about outsourcing your development, you must surely be wondering about how to keep your data secured.
    Data breaches are a real danger that can lead to fines and a damaged reputation. It's very important to understand how your data is being handled by everyone you work with, especially when working with agencies in different countries where the laws may differ.

    This article gives you six tips on securing your development outsourcing. These tips include protecting your intellectual property (IP), asking about security certifications, limiting privileges, forming an airtight agreement, and preventing breaches.



    Protect Your Intellectual Property

    Before outsourcing your development, you must be familiar with intellectual property laws. If you’re outsourcing out of your country, you will also need to review the intellectual property protection laws in that country.

    You can then discuss intellectual property policies with your selected agency. You will want to make sure they understand the laws and that they follow the rules.
    Ask about their security measures around intellectual property protection. For example, do their employees sign non-disclosure agreements (NDA)? The agency should be able to provide these details in-depth. If not, take it as a red flag. You can also discuss discrepancies and have your lawyer add this to your contract.

    The agency should be able to provide these details in-depth. If not, take it as a red flag. You can also discuss discrepancies and have your lawyer add this to your contract.

    Source Code Escrow, cyber security, data escrow

    The Ultimate Guide to Software and Source Code Escrow - Chapter 1


    What is a software or source code escrow agreement?

    If you’re a SaaS company and you’ve been in business for a few years now, you may have already come across a prospective business partner who was pretty insistent on the inclusion of a software or source code escrow agreement as part of the license terms. Eager to close the deal you’ve been negotiating laboriously for weeks or months, you now need to figure out how to give your client what they want while finding a way to save resources, whether it’s time or money.

    If, on the other hand, you’re a company looking to gain a competitive advantage by using new technology and automating your business processes, you may be outsourcing the development of said technology (i.e., software application) to an emerging software company. If that company is not quite established or profitable yet, you may now be considering minimizing the risk for your own company by implementing a software escrow agreement.

    1 2