The date that keeps a gift a gift
Giving something back is a decision, and a decision has a size and an end. Set the size, leave the end out, and the return converts into a position neither of you chose to take.
referral share
Meaning
A portion of transaction value paid to an intermediary who introduced a client or facilitated a deal. Distributing a referral share compensates the connector for their social capital without requiring them to perform the underlying work. This arrangement is common in professional services where trust is the primary driver of new contracts.
Split Ratio
The size of the payout is usually calculated as a percentage of the total project revenue or the first year’s contract value. When determining a referral share, the parties must balance the value of the introduction against the actual cost of executing the work. If the ratio is too high, the operator cannot afford to deliver high quality service, while a low ratio fails to motivate the connector to bring future opportunities.
Transaction Fee
Compensating the connector represents a direct cost that must be factored into the project’s pricing model from the start. Unlike ongoing equity, a referral share is typically a one time fee or a time limited split of incoming cash. This protects the operator from carrying a permanent load for a single past action, ensuring that future labor is paid fairly.
Value Floor
This minimum transaction size ensures that the introduction is worth the administrative effort and the payout. It prevents the operator from paying out percentages on tiny contracts that do not cover their own delivery costs. Once this floor is established, the referral process becomes a predictable driver of healthy growth.