Software pricing
expert witness.
I testify on how business-to-business software is priced, packaged and licensed, and on what a pricing change was worth when the parties disagree.
I am Chris Mele, chief executive of Software Pricing Partners (SPP). Counsel retain me when a dispute turns on pricing architecture: the three structural decisions (licensing model, packaging model, pricing model) that determine how a software company captures value.
Software pricing has a structure, and disputes about it are usually disputes about that structure: which unit the price attached to, which capabilities sat in which edition, what a license granted, and what happened to revenue when one of those decisions changed. I have designed and repriced those structures for software companies as the head of SPP. Before that I founded and ran a software company, where as its CEO I negotiated the distribution agreements and third-party contracts and ran sales, marketing and operations.
Litigation asks a narrower question than an engagement does.
the record.
the exhibit.
and only that.
An opinion on software pricing is useful to a court when a second expert can take the same exhibit, follow the same steps and arrive at the same number. Anything that cannot be re-run from the record does not belong in a report.
Every figure can be re-run from the exhibit.
Chris Mele
I run Software Pricing Partners, a firm that designs the licensing, packaging and pricing of business-to-business software and stays engaged while the client’s team operates it. OpenView ranked me first on its list of B2B SaaS pricing experts. Before that I founded and ran a software company as its CEO, negotiated its distribution agreements and third-party contracts, ran its sales, marketing and operations, and took it through its own pricing transition. My testimony draws on both seats: the architect who designs these structures and the operator who lived inside one.
The firm’s pattern library, built across decades of engagements by more practitioners than me, informs my judgment and nothing else in a report.
Full biography and career milestones →What I testify on.
Four subjects, each a question a court can put to a pricing expert and receive an answer it can check.
Software pricing
and packaging
How a software product’s price was built: the value metric the price attached to, the editions and add-ons the capabilities were grouped into, the list price, and the discounting that produced the net price on each invoice. When the parties disagree about what the pricing was, or whether a deal followed the pricebook, I read the record and say what it shows.
Earnout and
price-allocation disputes
After an acquisition, the seller’s payout often depends on revenue that the buyer now prices. When the buyer bundles, repackages or reallocates list price across products, the revenue credited to the acquired product moves with it. I testify on how the allocation was made, how the pricing in force at closing would have made it, and what separates the two.
License and
packaging disputes
What a license granted, what an edition included, and whether a deployment, a partner arrangement or a usage pattern sat inside or outside that grant. These disputes turn on the licensing model and the packaging model as written and as sold, and I read both against the product as it was delivered.
The value of
a pricing change
What a repricing, a metric change or a repackaging did to revenue, and what revenue would have been had the change never happened. I build the comparison from the parties’ own transactions, with each assumption stated and each step shown, so the result can be tested step by step.
Where these
disputes arise.
A small set of situations produces most of the pricing questions that reach a courtroom or an arbitration panel. Each one is, underneath, a question about which decision in the pricing architecture changed and what followed from it.
Earnout disagreements
after a sale
The seller’s payout was tied to the acquired product’s revenue, and the buyer changed how that product was priced, packaged or sold before the measurement period closed. The question is what the acquired product earned under the pricing that governed it, and what it earned under the pricing that replaced it.
Price allocation
inside a bundle
A product was sold inside a bundle, a platform agreement or an enterprise license, and the parties disagree about how much of the price belongs to it. The record usually holds the answer in the pricebook, the quotes and the order forms, and the work is reading them in the right order.
License scope
and edition contents
A customer, a partner or a reseller used the software in a way the vendor says the grant did not cover, or paid for an edition the vendor says did not include what was used. The licensing model and the packaging model are read against what was sold and what was delivered.
Repricing and
repackaging claims
A vendor changed the metric, the editions or the price, and a customer, a channel partner or a former owner says the change cost them something the agreement protected. The comparison runs on the parties’ transactions before and after the change.
Sponsor and founder disagreements
over an acquired product
A private equity sponsor and a founder or management team disagree about what the pricing of an acquired product did to its value after the deal. The same reading applies: which decision changed, what the transactions show, and what the change was worth.
How the work
is done.
A report is an argument a stranger can check. Four rules keep it that way, and every report I sign follows all four.
Every number comes from the record
Contracts, pricebooks, quotes, invoices, order forms and the parties’ own revenue reports, plus public price lists and public filings. A figure that cannot be traced to a produced document or a public source stays out of the report.
Experience informs the judgment
SPP’s pattern library, built across decades of engagements by more practitioners than me, tells me where to look in a record and what a pricing structure usually does under a given change. It supplies no numbers. The library is the qualitative basis of the firm’s judgment, and the report says so in those words.
The arithmetic is transparent and reproducible
Each step is set out in an exhibit a second expert can follow: the source document, the operation applied to it, and the result. Where an assumption is needed, it is stated, and the report shows how the result moves if the assumption moves.
The workbench is disclosed
Where the record is large, I use LevelSetter, the firm’s pricing platform, to organize the transactions and re-run the pricing rules across them. That is what lets me hand a forensic accountant finished recast tables on demand: the ledger under the contract’s rules, under the alternative rules the pleadings describe, and rolled forward under each. The platform is a calculator on the exhibit’s data, and every calculation it performs is the one written out in the report.
For counsel. Write with the case name, the court or panel, and the key dates. The first reply is a conflicts check.
Talk to an ExpertThe line I hold.
Three questions sit close to a pricing opinion. I answer one of them, and the report names the other two so nobody mistakes where it ends.
Intent belongs
to the court
Whether a party meant to reduce a payout, step around a grant or harm a customer is a question for the finder of fact. My opinion covers what the pricing did; the reason anyone did it sits outside it, and the report leaves it there.
The summation belongs
to the accountant
Adding up damages, applying interest, tax and the contract’s own formula is the forensic accountant’s work. My report ends where the pricing question ends and hands its figures across in a form the accountant can carry forward.
The pricing question
is mine
What the price was, what it became, which of the three decisions changed it, and what the change was worth on the parties’ own transactions. That is the opinion, and it is the whole of it.
Who retains me.
Counsel on either side. The method is the same for a plaintiff and a defendant, and a report that only works in one direction is worth little to either. Retention runs through counsel, and the first step in every matter is a conflicts check against the parties and the products.
Sponsors in a dispute over an acquired product. A private equity sponsor whose portfolio company is in an earnout, price-allocation or licensing dispute retains me through its counsel, and the same rules apply: the parties’ data, public sources, transparent arithmetic and the pricing question only.
The pricing expert does the forensic work, so you do not pay for it twice.
The transaction work in a pricing matter is reading every invoice, reconciling each one to the statements and re-deriving every figure from the record. When a matter retains a forensic accountant and a pricing expert separately, that reading happens twice. Here it happens once: I do it to forensic grade, inside the pricing analysis, and hand over work papers that the accountant, the other expert and a cross-examiner can rerun line by line. Counsel pays for the data work once, from one expert, at under half the cost of two readings.
I take a few matters a year, alongside running the firm, and only those where the pricing question decides something and the record is complete enough to do the arithmetic from. The matters I am drawn to are the high-stakes ones: an acquired product whose pricing was changed inside an earnout window, a founder’s payout that depended on a pricing decision someone else controlled, a license whose economics were rewritten after signature. Intent is the court’s finding; what was done to the pricing, in what order, is usually the record it rests on, and that is the part I can put in an exhibit. The limit on how many I take is deliberate: testimony from someone still designing pricing every week is grounded in current practice, and that is what makes it useful to a court.
Some matters call for a consulting expert who works behind counsel and does not testify; others call for a testifying expert whose report and deposition are on the record. I take both roles, and within a matter the two are kept separate.