When Prospects Offer Referrals As Payment…

Freelancers largely live and die by referrals. Their future work tends to come from people who heard good things about their efforts from previous clients. Most people understand this concept and, unfortunately, there are more than a handful who attempt to exploit it.

The conversation between a would-be client and a freelancer under this circumstance tends to go along the lines of the following:

Hey, I really want your help but can’t really pay. I’ll tell you what: If you do me this favor, I’ll be sure to put in a good word for you with some people I know that want similar things. You’ll have a new batch of clients and easily make back what you would have made with me. It will be win-win!

When it comes to prospects and clients, as far as freelancing goes, one rule of thumb to keep in mind is this: “Birds of a feather, flock together“. Individuals from a given industry/organization/income bracket/etc tend to have friends and associates from the very same.

While this is hardly a hard-and-fast rule, you should understand that if you are approached by someone who is interested in your work, but is unable to properly compensate you for it, there is a very good chance that anyone they could refer you to would be in no position to do you a better justice for a similar output of your time and trouble.

In short: Promises like these tend to be wild goose chases and should rarely, if ever, be encouraged.

However, for the sake of argument, lets say that you wanted to give this individual or organization a fair enough chance to put-their-money-where-their-proverbial-mouth is. In that case, I would suggest you begin your response with five simple, but nonetheless timeless, words:

I want it in writing

Now this is where the “payment terms” portion of your contract will come in (You do use contracts for your projects, right? RIGHT?!?!?): You and your prospect would agree on what would be a fair dollar amount value of your work. You would then take this dollar amount, put a premium on it, and tell the prospective party that, in exchange for your performance on the project they want executed, that they would be legally bound to generate one or more leads for you that would net you compensation that is at least equal to, if not greater than, the premium quote.

To make sure they don’t drag their feet, you state an enforceable timetable for your prospect to come up with these leads in (the exact lead time will depend on the type of work you do and how many leads are being promised). Finally: Make it very clear that a failure to execute on this part will be considered a breach of contract and grounds for collections/legal proceedings, just as it would be if they didn’t fully pay you outright.

At this point, the prospect party will likely bristly and try to get you to bend on this. The following stick-to-your-guns response, or something along its lines, will either shut them up and turn them away or shut them up and get them looking for a pen:

Listen: This will protect both of us and ensure that we don’t waste each others time. It will reasonably assure you that I can and will do what I say I can do for you and it will reasonably assure me that you can and will do what you say you can do for me….

…unless you DON’T think that you can actually do it, DO YOU? O_O

As long as you hold this line, the BS in this case should very quickly and quietly burn itself out, like a lit match trapped under a jar.

Can something like this REALLY be enforced and sued upon?

That’s a very good question. The answer is likely to vary to a degree depending on your industry and location. For my part: Every time I’ve called a prospect on this bluff (which it usually is), they ended up walking away. Fine with me, as I don’t have the time to be dealing with empty promises. As for the contract part: I’m not a lawyer,  but  I have read more than a fair share of books on contract law and I’ve had to apply what I learned from them. I can safely tell you that if you get an agreement on paper that is signed off on by another party, as long as you can demonstrate due diligence and performance on your part, you’ll be at a very strong advantage in any court proceeding or mediation session that you need to walk into should you need to make that push. Your client will need to explain themselves and answer questions long before you do, if at all.

Have any thoughts on this? Fill in the boxes below. Thanks for reading.