Four inputs, a defensible range. The math is published at the bottom of the page.
A warm intro on a $50,000 ongoing service contract: convention says 6.5–9% of first-year fees, paid on close.
The base ranges are published convention, not our opinion.
Ongoing services and professional engagements — agencies, MSPs, consulting, advisory work — commonly run 5–10% of first-year fees. Software subscriptions and one-time projects commonly run 8–15%, of first-year contract value or project price.
Percentages decline as deals grow. A $2M contract does not take ten times the effort of a $200k one, and referral fees follow effort more than value.
A passed name earns the low end of the range; advocacy through the close earns the top. This tracks how referral partnerships actually price: common tiers run around 10% for a warm lead and 20% for a fully qualified opportunity, rising further when the referrer works the deal. Earlier payment triggers are discounted — paying before the deal closes transfers risk to the payer.
Referral fees are conventionally capped at first-year revenue. Retention beyond year one reflects delivery, not the introduction.
One tax practicality: in the US, referral payments of $600 or more to an individual in a year generally require a 1099-NEC.
Base ranges reflect published market conventions from Referaly, Sakas & Company, ReferralHero, Referral Rock, RefGrow, SaaStr, and the Journal of Accountancy. The 30% close-rate assumption in the payment-trigger adjustment is consistent with our Referral ROI calculator.
In some fields — legal, accounting, real estate, healthcare, insurance, securities — referral fees are restricted, capped, or require written disclosure. State bar rules, AICPA ethics rules, RESPA, and the Anti-Kickback Statute are the usual culprits. This tool models market conventions, not compliance. Talk to counsel.