In Part 1 of this article I provided overview of sharing feature in Office 365. You can read that article HERE.
Now lets talk about what happens behind the scene when you share you content with external users.
External Sharing Approval process:
As of the writing of this article you must have a contributor or higher role when sharing a site or document with external users. This requirement is for the first time invitation only. E.g. you have three different sites under your private site collection and you share one of the sites with email@example.com. Since this is the very first invitation for firstname.lastname@example.org, the person sharing the site must be a contributor or higher. The following image explains the process of inviting external users for the first time to the site.
Once the email@example.com user accepts the invitation then anyone on that site collection can share any remaining sites or specific documents on that site collection with that external user.
If a person with the read-only access shares another site or document on another site with the same external user i.e. firstname.lastname@example.org then that request will first go through the approval process. The Site Owner is required to approve that request before an external user gets an email invitation for the second site or document.
The following image explains the invitation process by the read-only user.
To summarize, you can increase the productivity of your SharePoint site by collaborating with external users in real-time using the SharePoint Online Sharing feature. I hope this blog post helps you.