The Deal Room, No. 4: Collaboration agreements, or: you may already be partners
General education, not legal advice. It does not replace a lawyer, and you should get an opinion on your own deal before you sign anything.
You can carry one assumption forward into every creative relationship: the law will not wait for you to make it official. It has defaults, those defaults switch on the moment two or more people start building something together for money. A collaboration agreement is one way to replace those default positions with terms you actually want.
Your lawyer may do the actual drafting, but you need to know what is being decided in that agreement. Most of these decisions are made by non-lawyers in a conversation long before anyone opens a template. This piece looks at each of the five decisions, what each one sounds like in plain language, and what each one does to you two years on.
What you are up against
Start with the thing most people get backwards. What is the difference between a collaboration and a partnership?
The intuitive answer is formality, and that’s half right. Where people go wrong is in which direction the formality runs: some assume a “partnership” is the paperwork version, while a collaboration is the informal version, and the gap between them is how serious everyone is. That answer is comfortable, but it is wrong in a way that can cost you a lot of money.
Most states follow a common statute on partnerships, and under it a partnership forms when two or more people work together as co-owners of a business for profit, even if no partnership is intended. Read that last part again. Intending it is not required. Nobody has to sign anything, name anything, or file anything. Not having a document is proof that you have no terms, so the defaults apply.
The handshake does not keep you out of a partnership. It keeps you out of a partnership agreement, which is a very different thing. What fills the gap is a standard set of rules you never agreed to: profits split equally no matter who did what, each of you able to commit the other in dealings with outsiders, personal exposure for debts your collaborator takes on for the project, and a legal duty to act in each other's interests whether or not either of you wanted one.
You can compare it to common-law marriage in the states that still recognize it. Nobody signs. Nobody has a ceremony. You hold yourselves out a certain way for long enough and the law just decides, oops, you’re married, with all the property consequences that follow.
Let’s look at a hypothetical, because lawyers love a good hypothetical. An artist and a programmer meet at a game jam and keep going. They split a Steam page fee, they call themselves a studio in the itch.io description, and they agree without ever discussing it that they will split whatever it makes. Eleven months later the demo gets traction and a publisher sends a letter of intent. Who owns the game is not decided at that point by who wrote more of it or who cared more. It is decided by eleven months of conduct nobody wrote down, and by rules nobody read.
This is why the conversation is worth having while everyone is still cheerful. Every decision below gets made either way. The existence of a written agreement decides whether you are the ones actually making those decisions.
One thing to clear before the substance, because it always comes up. None of this means you must form an entity. An LLC solves a different problem, which is keeping the project's debts away from your personal savings, and it is usually right before you take outside money or sign with a real counterparty. But an entity is a container, not a deal. Two people who form an LLC and never agree on how it runs have moved the same unanswered questions into a new box.
The five decisions
• Scope
• Intellectual property
• Time
• Money
• Exit
For each one there is a question to raise, an answer to listen for, and a cost if you skip it.
Scope. You are drawing a line around the project, and the mistake is thinking the work is describing what falls inside it. The inside is easy. You both already know what the game is. What you are really deciding is who owns everything outside.
So raise the outside on purpose. Someone has to build the pipeline, handle store submission, answer the Discord, chase the localization vendor, and do the thousand small jobs that belong to neither of you on paper and to both of you in practice. Either name them or agree how they get assigned. In the same conversation, settle the far boundary: is this one game, or is it a franchise? Does this cover a sequel, a port, a spinoff, a show?
Skip it and the question does not stay open, it gets answered later by whoever is more willing to fight, at the moment the answer is worth the most. Unassigned work becomes the quiet grievance that surfaces four months later. An unaddressed sequel becomes the reason a publishing deal stalls in week six.
Intellectual property. This is where the default rule is least intuitive and where the conversation is worth the most.
Under US copyright law, when two or more people create something intending their contributions to merge into one work, they co-own the copyright in the entire thing (think joint tenants instead of tenants-in-common, if you know the difference). That describes most creative collaborations on purpose, not by accident. Co-ownership sounds fair. In one respect it is harsh. Courts have generally held that either co-owner can license the whole work to an outside party without asking the other, as long as they hand over the other's share of the money.
Follow that forward. Your collaborator can license the character, the soundtrack, or the entire property to a company you would never have picked, and what you get is a check, not a say. Co-ownership is not a veto. It is a revenue share with someone else's judgment attached.
With an agreement, you have options. Either the IP goes to one owner who licenses it back to the other on stated terms, or you keep it jointly and agree in advance which kinds of deals need both signatures. Both are workable. Silence is the option that hands the decision to whoever moves first.
Then handle the edges. Your existing engine, your older art, your tools, the character you brought over from a project three years ago: that material is yours, and if the project is going to use it, the agreement needs to say so and say for how long. "We all understood it was fine" is not permission, and the bill arrives at the worst moment, which is when you leave and want your own work back.
Handle everyone else who touched it, too. Anyone who is not your employee owns what they made unless they signed something transferring it to you. There is a doctrine called work made for hire that treats the hiring party as the legal author, but for freelance work it only applies to a narrow list of categories, and much of what goes into a game does not fit any of them. The dependable route is a signed transfer, before the work is delivered, from every contractor, every jam collaborator, and every friend who did the UI pass as a favor. The favor is the dangerous one. Nobody wants to send paperwork to a friend, which is precisely why that is the gap that shows up later.
Don’t ignore the unglamorous items, because each has a tail. Who registers the copyright and who pays for it? Who is allowed to go after someone who copies you, and who decides whether to settle? How do credits read, and can you show the work in a portfolio or a talk afterward? And what happens to unfinished work if you separate before release, which is a different question from who owns the finished thing?
Time. Agree on how long this runs, what has to be done by when, and how much of each person's week the project can claim. Sensitive issues that come up around timing include exclusivity, non-competes, non-circumvention and non-disclosure.
Can either of you take other work, and does the answer change if that work competes? Settle it in a sentence. Leave it out and you get the version where someone ships something a lot like your thing, on another schedule, with another company's money, and nothing you agreed to said they could not. How long must things remain secret? Who are you allowed to talk to or recruit once things come to an end?
Money. It’s rarely the split that causes problems in a contract, despite being heavily negotiated. The definitions cause the fight. What counts as revenue, which costs come off the top before anyone is paid, who is allowed to spend, and up to how much without checking. Platform fees, engine royalties, tax withheld on foreign income, refunds and chargebacks, and the marketing spend one of you put on a personal card all have to land somewhere specific. Fifty-fifty of an undefined number is not a deal term, it is a mood.
Settle authority in the same breath. If a publisher calls, who is allowed to negotiate, and does anything bind before both of you sign? Leaving this open produces the most common early failure, which is the enthusiastic founder who says yes on a call and creates a position the other one has to spend real leverage undoing.
Exit. Every template has a termination section, which is exactly why it gets skimmed like furniture. Read it, and then push past it. What counts as a breach, does the other person get notice, and do they get a window to fix it before the deal ends? What happens if one of you simply stops working and never says so, which is far more common than a dramatic blowup and much harder to prove?
Then the part an AI template usually does not reach: what happens to the jointly owned work once the relationship is over? Without an agreement, you do not get a clean split. You get two co-owners who no longer speak, each still able to license the same property to anyone, forever. If you want something else you have to say so now. A buyout at a set formula, a first right to match any offer, or the work going to whoever keeps building it with a share of the upside going to whoever leaves. Any of those beats the default, and the default is a permanent tie to someone you have stopped talking to. It’s the messy custody battle in a divorce that would have been much cheaper with a pre-nup.
The question underneath all five: who is holding the bag
Risk does not need its own section. It is the thread that runs through the entire agreement.
Run it across the list. If the project fails, who has spent eighteen months of unpaid labor and who has spent a few weekends? If someone claims you infringed, whose name is on the registration, who has to defend it, and whose personal savings sit behind the project? If a payment does not arrive, which of you can actually enforce it and which of you has to ask nicely? If one of you gets decision-making power for the sake of speed, what does the other one have when it gets used badly?
The answers are almost never symmetrical, and that is fine. Collaborations are not equal, and pretending otherwise produces worse agreements. The failure is discovering the imbalance after the money arrives, when any attempt to fix it looks like a grab.
Where all of this gets read
Most collaboration agreements (or partnership agreements, for that matter) never see a courtroom. They get read in a diligence checklist.
When a publisher, investor, or buyer shows up, they are not evaluating your relationship. They are checking chain of title, which is the paper trail proving who owns each piece, and they are doing it line by line in a spreadsheet. Every contributor, every transfer, every permission, every open question. What they find is either a clean line from each contribution to someone who can actually grant what they are paying for, or a set of holes that has to be patched under deadline by people whose leverage just changed.
Price the difference. Getting a signature from a friendly former collaborator costs a conversation. Getting one from a collaborator who has worked out that you need it costs whatever they decide it costs. That is the argument for doing this early, and it has nothing to do with trust.
When to stop and call someone
Handle the five conversations yourself. Bring in a lawyer before you sign anything if outside money is involved, if the work uses licensed or third-party material, if anyone is contributing from another country, if a contributor has already delivered work without signing a transfer, or if the split is anything other than what both of you would describe the same way without notes.
What you should be able to do now
Walk into the conversation and name five things: where the project's boundary sits and who owns what falls outside it, whether the work ends up with one owner or two and what needs both signatures, what each person's time is committed to and what they stay free to do, how revenue gets defined before it gets divided, and what happens to the work after one of you leaves.
For each one, say the term out loud, then say what it does in two years. If you cannot finish the second sentence, it is not settled yet.
Next in the series: the term sheet, and why the non-binding document is the one that decides everything.