Publisher Red Flags: What to Look For in Contracts and Negotiations

Signing with a publisher can be a pivotal moment for a developer looking for external support and financing, and even the most experienced industry veterans don’t always know or recognize the telltale signs of a bad partnership. Publishing deals are often positioned as a necessary lifeline: funding, marketing support, platform access, and perceived legitimacy. But not all partnerships are created equal, and some deals quietly transfer risk, control, and onus almost entirely onto developers.

Some publishers offer little in the way of material value while taking the lion’s share of the revenue. Some publishers are simply inexperienced, unskilled or unable to execute on promises. Some publishers and developers simply aren’t the right fit for one another. And some publishers – certainly more than zero – are explicitly malicious, unethical or exploitative (or all three).

Akupara Games started our journey as a developer and transitioned into publishing after we had bad experiences with publishers who provided minimal value in exchange for maximum rev-share. It’s a tale as old as games publishing itself. And after nearly 10 years in the publishing business, we’ve heard and seen horror stories from every angle – publishers who have shuttered and left games in perpetual limbo, contracts and promises broken, public and messy legal disputes, unethical business practices, exploitative grifters and garden-variety creeps.

This guide is designed as a practical breakdown of common publisher red flags to help developers recognize early when a deal isn’t a mutually beneficial partnership. While it’s not an exhaustive list, these are some of the warning signs that a publisher might be trying to take advantage of you.

By the way, signing with a publisher totally isn’t necessary for everyone – we recommend checking out our CEO David’s Publishing 101 series to see if a publisher is even right for you in the first place.

At the end of this article, we provide some supplemental resources to help you further educate yourself on finding the right partner (while simultaneously protecting yourself).

Contract Terms Red Flags 🚩

100% Upfront Recoupment
Recoups More Than Investment
Transfer of IP Ownership
Optioning of Future IP
No Exit Clause
Exploitative Payment Terms
No Audit or Reporting Visibility

Contracts define the power structure of a publishing relationship. Many red flags aren’t obvious “gotchas,” but subtle clauses that compound over time. Exploitative contract terms can often be buried in lengthy legalese, missed due to timeline pressures, or even unintentionally written to be unfair or unbalanced.

You should always, always take the time to review the terms of your publishing contract with an entertainment lawyer well-versed in the space and redline or negotiate any clauses that are uncomfortable or unworkable for your needs. Never sign anything without legal counsel.

Of course, sometimes there are exceptions that might make sense, and ultimately you will need to work with your publisher to decide the terms that are best suited for your situation. This guide is for educational purposes and reflects best practices, not universal, inflexible rules. Publisher deals vary widely depending on circumstances and need to be considered holistically.

So, with that in mind, what are some of the red flags to keep an eye out for?

100% Upfront Recoupment

Red flag:
The publisher recoups 100% of its investment before the developer sees any revenue – often including marketing, overhead, and internal costs.

Why it matters:
Even a moderately successful game may never generate royalties for the developer or may not see payouts for multiple years. After all the direct development financing is expended, the developer is left with a gap in funding. Developers should always get paid from day one!

Watch for:

No minimum payout floor
Full recoupment before any profit split
Publisher recouping all expenses – internal, direct and indirect funding
- The publisher should be willing to take on some of the financial risk!

Healthy alternative:

Partial recoupment or early revenue sharing after launch costs are recovered.
- This rev-share split may swap in the developer’s favor after the publisher recoups expenses.

Recoupment That Exceeds Investment

Red flag:
The publisher recoups more than it spent via multipliers, fees, or markups.

Why it matters:
This acts like hidden interest, dramatically extending recoupment timelines. Recoupment should only be in the amount of actual expenses. Careful – even some well-known funds and grants sneak this into their contract terms.

Watch for:

110–200% recoupment
“Administrative” or “management” fees
Internal costs inflated or billed above market rates

Healthy alternative:

Recoupment capped at actual, documented spend, with clear definitions.

Transfer of IP Ownership

Red flag:
The publisher requires a full transfer (assignment) of intellectual property ownership, often covering current and future works, derivatives, and improvements – even for projects the publisher never meaningfully supports.

Why it matters:
You permanently lose control of your work. This limits future monetization, reuse, reversion opportunities, and negotiating leverage, even after the publisher has recouped its investment. You should retain the rights to your own creative works.

Watch for:

“Assigns all right, title, and interest” language
“In perpetuity” “any format now known or later developed” language
No reversion of rights after recoupment or term end
Ownership transfer bundled into standard boilerplate
Broad definitions of “IP” that include unrelated assets

Healthy alternatives:

Publisher receives a limited, purpose-specific license (exclusive or non-exclusive), with clear scope, term limits, and automatic reversion of rights once obligations are met.
Rights limited by platform, territory, time, and scope.

When This Might Be OK:

When the partner is well-established and big enough to be able to expand your IP significantly.
If the partner offers you a huge, life-changing payout.
If and when your publishing partner is First Party like Sony, Microsoft, or Nintendo.
If your studio closes and you are at risk of becoming lost media.

Optioning of Future IP

Red flag:
The publisher gets first refusal or options on future games or unrelated IP, such as DLCs or sequels that they don’t support.

Why it matters:
This can reduce your leverage for future deals or lock you into bad partnerships beyond a single title or contract term (even if the option is never exercised).

Watch for:

“Any future works”
Long decision windows (6–12+ months)

Healthy alternative:

Options limited to direct sequels, short decision windows, no penalties if declined.

No Exit Clause

Red flag:
No clear path for rights to return if the publisher underperforms, goes out of business or breaches the contract terms.

Why it matters:
You can be stuck indefinitely with a dormant, unfinished, unsupported or neglected title. Trust us when we say this is happening much more often than you are hearing about in the news, even with large, well-known publishers.

Watch for:

No sales thresholds
No termination for non-performance
No reversion opportunities, even for cause

Healthy alternative:

Rights revert if milestones aren’t met or after a defined time.
Exit from the contract if both parties mutually agree.

Exploitative Payment Terms

Red flag:
The publisher controls cash flow through delayed, conditional, or opaque payment schedules.

Why it matters:
Even when your work performs well, slow or discretionary payments can starve you of income, shift financial risk onto you, and make long-term planning impossible.

Watch for:

Long payment timelines that favor the publisher
Payments contingent on “publisher receipt” or internal approval
No obligation to pay interest on late payments
Broad rights to withhold, offset, or bundle payments
Vague or undefined accounting periods

Healthy alternative:

Clear, fixed payment schedules, automatic payment obligations once revenue is earned, transparent statements, and penalties or interest for late payments.

No Audit or Reporting Visibility

Red flag:
The publisher provides vague statements (or none at all) and denies audit rights or limits them so heavily they’re unusable.

Why it matters:
Without transparent reporting and audit access, you cannot verify sales, recoupment status, or royalty calculations, making underpayment or misreporting impossible to detect.

Watch for:

No contractual obligation to provide regular statements
Reporting “at publisher’s discretion”
Audit rights limited to extreme conditions
Audit only allowed if “material breach is suspected”
Publisher-controlled data sources with no verification rights
Limited, revoked or refused access to backend reporting tools

Healthy alternative:

Regular, detailed royalty statements (at least quarterly), clear calculation methodologies, and a practical audit right allowing independent review with reasonable notice and scope.

Partnership Red Flags 🚩

Creative Control and Vision
Misalignment of Values, Ethics and Goals
Quality and Distribution of Services
Overpromising and Underdelivering
Portfolio Neglect
Adversarial or Combative
Speed Over Diligence

While contracts are one of the most important areas to do proper diligence, the relationship behind them matters almost as much. While a partnership can be great on paper, there are a ton of relationship or meta red flags that developers don’t even think to look for or consider in their search for a partner.

These red flags go beyond ink on paper, but inform what the actual working relationship will be like in practice. Treat this like a two way interview process – ask questions that will help you determine if you are a fit from an actual services, methodology, pillars, vision and values perspective as well! After all, you’re likely going to be stuck with each other for multiple years, contractually.

Creative Control and Vision

Red flag:
Publisher has “final say” on creative decisions without limits. Even if this isn’t detailed in the contract terms, look for hints that the publisher intends to steamroll creative decisionmaking or bypass approval or feedback rounds.

Why it matters:
Your game can be reshaped to the point it no longer fits your creative vision. Sure, publishers should be providing feedback, playtesting, quality assurance, marketability and market-fit advice, analyses and strategy…but ultimately, they should be signing your game because they believe in the vision and your ability to execute on it.

Watch for:

“At Publisher’s sole discretion”
Approval over art, narrative, tone, monetization
Pushback on creative direction, especially with regards to audience, tone, voice, brand identity and positioning

When This Might Be OK:

When the content has the potential to impact sales, ratings or regional distribution.

Misalignment of Values, Ethics and Goals

Red flag:
The publisher’s incentives, behavior, or strategy conflict with the creator’s long-term goals, audience trust, or ethical standards.

Why it matters:
Even financially sound deals can fail when values clash – leading to brand damage, audience backlash, or strategic dead ends. If there are certain aspects of your personal identity, company or game pillars that are in direct conflict with those of the publisher, it creates all sorts of conflict and friction when it comes to making business decisions that impact your product and livelihood. If you and the publisher have different goals or success metrics for your product, then you won’t be moving in the same direction together.

Watch for:

Aggressive monetization that harms audience trust
Short-term revenue focus over long-term growth
Publisher actions that conflict with your public stance or mission

Quality and Distribution of Services

Red flag:
Same marketing, production, and launch plan for every game. Misalignment between services offered and services required. Unfairly balanced distribution of responsibilities and workload. Excellent ideas and promises with poor execution or output.

Why it matters:
Your game has unique risks and audiences. Alignment creates commitment.

Watch for:

Generic marketing plans
No genre-specific insights
Publisher does not offer services required
Publisher has little downside if the game fails

Overpromising and Underdelivering

Red flag:
Big verbal promises not reflected in the contract. Anyone can promise that they can provide value in exchange for rev-share, but it’s important to vet that they will actually do what they claim.

Why it matters:
“If it’s not written down, it doesn’t exist.”

Watch for:

High staff turnover – your champion at the publisher keeps changing
“We’ll figure that out later”
“Trust us”
Resistance to adding specifics
Publisher discourages seeking references or referrals

Portfolio Neglect

Red flag:
Publisher signs many games but actively supports few. Shotgun launch approach hinders true integration into the project. No longtail support post-launch.

Why it matters:
Your game may be shelved quietly, or may never achieve the critical success it deserves because no real effort was made.

Watch for:

How many titles launched vs announced?
How long support lasted post-launch?
How many projects are team members supporting?
How many projects are launched annually?

Adversarial or Combative

Red flag:
Negotiations feel combative rather than collaborative. Pay attention to how the partner communicates via email or calls. Do they seem like someone who would genuinely care about your project and want to collaborate in good faith?

Why it matters:
This sets the tone for years of working together. You don’t want to be legally shackled to someone who doesn’t see or treat you as a partner.

Watch for:

Pressure tactics
“This is non-negotiable”
Deadline threats
Inability or unwillingness to compromise

Speed Over Diligence

Red flag:
They want you to sign fast.

Why it matters:
Good partners encourage legal review, they don’t try to trap you in a deal you haven’t fully vetted.

Watch for:

Advocation of skipping crucial process steps
Everything seems too good to be true

When This Might Be Ok:

If there is an upcoming opportunity, event or major beat that may warrant an accelerated timeline. But still, don’t rush the contract, and go at a speed that is comfortable for you (there will always be other opportunities)

A good publisher reduces risk for developers and sets them up for success. A bad one transfers risk entirely.

The best deals are about alignment, transparency, and shared incentives. It’s all about winning (or something, losing) together. If a contract or conversation consistently shifts control, risk, and downside onto the developer, it’s not a partnership, it’s a liability.

Trust your instincts, get legal review, talk to other developers, and remember: You’re not just signing a contract – you’re choosing years of collaboration.

If you want help reviewing deals, understanding tradeoffs, or learning what healthy publishing relationships actually look like, that conversation should always start before the signature.

If you want more resources to help you make the right, informed decisions, we recommend:

Publisher Pathfinder: My retro-style web tool for game developers, that acts like a “choose your own adventure” game to match you with suitable game publishers, investors, and funding sources from a large database.
Developer Resources: Pitch deck template, MNDA, financial spreadsheet, and publishing agreement from Raw Fury.
Game Dev’s Guide to To Publishing Agreements: A guide designed to help devs navigate the complexities of video game publishing agreements. It consists of several articles that explain the clauses most commonly found in these contracts.
Indie Game Publishing: The aim of the 2025 Publishing Agreement Market report, which builds off our 2020 GDC presentation of the same name, is to democratize publishing agreement data. By analyzing data from over 100 publishing agreements we hope to level the playing field between both developers and publishers when negotiating publishing agreements.
Five Key Publishing Contract Pitfalls: Attorney Kellen Voyer laid out five common problem areas for indie developers to watch out for in publishing contracts, including issues with licensing, DLC, and IP.
What Makes a Good Publishing Contract: A breakdown of Raw Fury’s publishing contract by GameDiscoverCo
Video Game Publishing Agreements: What Developers Need to Know in 2025 by Zachary Strebeck, Attorney at Law.