Suggested internal effort: 4–10 person-days plus external negotiation and counsel time; assumption only. Translate the successful pilot into a production scope. Separate pre-training, fine-tuning, retrieval, evaluation and further-derived uses; the technical distinction between external retrieval and model parameters is described in the RAG research. Lewis et al. — Retrieval-Augmented Generation for Knowledge-Intensive NLP Tasks
For each permission, decide the corpus, version, recipient, territory, term, output treatment, updates, sublicensing and post-termination position. Add exclusions and existing customer carve-outs. Define who bears costs when a source item must be withdrawn or an update fails. Ensure liability promises match the evidence the owner actually holds.
A worked cash model — entirely hypothetical
Assume $120,000 is actually collected, a 15% commission is payable on those receipts, preparation costs $24,000, legal work $8,000 and ongoing delivery $10,000. Contribution before tax and unallocated overheads is $60,000. No amount is a market rate.
| Scenario | Collected receipts | Commission | Other specified costs | Contribution |
|---|---|---|---|---|
| No sale; preparation and legal sunk | $0 | $0 | $32,000 | −$32,000 |
| Lower receipts; delivery still required | $60,000 | $9,000 | $42,000 | $9,000 |
| Illustrative central case | $120,000 | $18,000 | $42,000 | $60,000 |
| Higher receipts; same assumed costs | $180,000 | $27,000 | $42,000 | $111,000 |
Under the same simplified costs and commission, break-even collected receipts are $42,000 / 0.85 = $49,411.76. This ignores timing, tax, financing, internal labour, contributor shares, refunds and other omitted costs; add them before using the model for approval. The no-sale row assumes delivery never starts, which is why its costs differ.
Evaluate payment timing separately. For example, under an assumed $30,000 pre-delivery receipt and an immediate 15% commission, only $25,500 is available against $32,000 of preparation and legal costs: a $6,500 funding gap before other costs. Booked contract value does not fund that gap.
Completion condition: finance approves the cost and cash assumptions, product approves potential overlap, counsel approves the agreement, and the authorised executive accepts remaining risks. Do not sign against an old financial model after changing the rights or delivery obligations.