Pay on collected revenue
Commission on booked revenue means paying out of money that has not arrived, and clawing it back when it does not. Commission on collected revenue is slower to start and never wrong.
It also aligns the partner with retention rather than signature, which is the behaviour you want from anyone bringing you customers.
Rates by partner type
| Type | Typical rate | Duration | Why |
|---|---|---|---|
| Referral | 10–20% | First year | Low effort, no delivery, no ongoing cost to them |
| Affiliate | 15–30% | First year | Volume business; the rate has to compete for the placement |
| Agency | 10–25% | 12–24 months | Services revenue is their main income; this is the sweetener |
| Reseller | 20–40% | Life of account | They own the relationship and carry the cost of serving it |
| Co-sell | 0–10% | Per opportunity | Usually reciprocal pipeline rather than cash |
The three that quietly kill programmes
- Paying on signups instead of revenue. Volume partners optimise for exactly what you pay for. Pay for signups and you will get signups.
- One-time commission on a recurring product. It tells an agency the relationship ends at signature, and they will treat it that way.
- Retroactive rate changes. Not a complaint — a silent stop. You will notice it a quarter later as a gap in the pipeline.
Whatever you pay for is what you will get more of. Choose the metric before you choose the number.
Clawbacks, done fairly
A clawback window covering early churn is reasonable and most partners accept it without argument. Two rules keep it fair: cap it at what was actually paid, and make the window shorter than your typical retention curve rather than longer.
Never claw back more than the partner earned on that account. It is the fastest way to turn a good partner into a former one.
Tiers, and when not to bother
Tiering is worth building when you have enough partners that a small number are meaningfully outperforming, and you want to reward them in a way others can see and aim for. Below roughly twenty active partners it is programme design theatre.
If you do build tiers, make the criteria a number rather than a judgement. A partner should be able to work out their own tier without asking.