Prepaid vs. Invoiced Lead Buyers

What 440 lead companies publish about payment

We read the websites, terms and FAQs of every company in our pay-per-lead directory and recorded how each says buyers pay and how long they commit. 298 of the 440 say nothing public about funding. Among the 142 that do, paying first outnumbers paying later by a wide margin.

The pattern is clear. A prepaid company rarely needs a contract, because the money is already in hand. An invoicing company often does, because the contract is what it collects against. The common offer in this market is simple: fund an account, receive leads until the balance runs down, stop when you want.

Payment terms also predict how much else a seller publishes. 78 of the 82 prepaid companies publish return terms, against 119 of the 298 that say nothing about funding. Buyers notice. Of the 209 companies whose sites carry a buyer FAQ, 52 answer a question about payment or billing and 88 answer one about minimums, contracts or cancelling.

How prepaid and card-on-file accounts work

The prepaid companies describe the same basic arrangement in different words: the buyer adds funds, and each lead is deducted as it is delivered. The details vary, and they are worth copying.

• Automatic refill. 13 companies recharge the buyer's card when the balance gets low, or offer it as an option the buyer can turn off. One ties the refill threshold to the buyer's highest bid, so a balance never sits below the price of the next lead.
• Delivery stops at zero. A few say plainly that leads start only after funds clear and pause when the balance is used, until the buyer adds more. The seller never delivers a lead that has not been paid for.
• Deposits. Several require an initial deposit before activation. Some size it by geography or practice area, one sets a minimum monthly spend to stay active, and one makes it non-refundable but credited toward leads.
• Bonus credit. A few add bonus credit for larger deposits or packages, and a few others make promotional or bonus credit final sale, so it cannot be returned or cashed out.
• Unused balance. Terms split. A few refund unused funds on request or on cancellation, a few say unused funds are non-refundable, and a few let credits expire after a set period while a couple promise they never expire. Say which applies before the buyer funds.
• Returns go back to the balance. Of the 78 prepaid companies with return terms, 38 settle approved returns as a credit to the account. See the lead return policy guide.
• Spreading the cost. Several let buyers spread payment: installments on larger plans, payment plans under a signed agreement, or buy-now-pay-later financing at checkout.

Card on file is not always pay first. Most card-on-file companies charge at the moment of purchase or refill a balance automatically, which works like prepayment. But a few bill the card weekly in arrears, or charge repeat clients after leads are sent. A card on file without a funded balance still leaves the seller waiting on a charge that can fail or be disputed.

How invoiced buyers work

Only 18 of the 440 companies say they invoice, and their terms show why sellers are cautious about it.

• Contracts come with it. 8 of the 18 mention a contract, such as an insertion order or service agreement that sets the price, filters and payment terms.
• Deadlines do the work a balance would. Invoiced terms set when payment is due and a deadline for disputes, and a few pause delivery while an account is past due.
• They drift toward prepayment. A few invoicing companies bill monthly in advance rather than after, take an automatic draft if payment is late, or reserve the right to ask for prepayment or a deposit.
• They follow the pricing model. Among companies that price per sale or acquisition, as many invoice as take payment first, 3 each, while across the directory pay-first companies outnumber invoicing ones many times over. When the price depends on what the buyer closes, the seller has to wait for the result anyway.

The problem with invoicing is timing. By the time an invoice is due, the seller has paid for the traffic, delivered the leads and given the buyer weeks to decide they did not like them. If the buyer pays late, disputes the bill or disappears, the seller carries the cost. Contracts, due dates and dispute deadlines manage that risk. A funded balance removes it.

Who pays first, by market and by pricing model

Companies that sell into several verticals count in each row.

Insurance has the most prepaid companies, and prepaid outnumbers invoiced there many times over. Lending has nearly as many invoicing companies as home services despite being a much smaller market, which fits a market where some sellers are paid on funded loans. Real estate is the most open, with nearly half its companies stating how buyers pay. Debt relief and education say the least, which usually means terms are set privately, deal by deal.

Bidding, live transfers and appointments are where prepayment is strongest. A buyer bidding in real time needs money behind the bid, and a transfer is consumed the moment it connects. Pricing tied to the buyer's outcome sits at the other end, and so do the invoices.

Contracts, notice and volume controls

Long contracts are rare. 168 companies advertise no long-term contract, against 32 that mention one, and where a contract appears it is often a short commitment, an insertion order or a subscription that renews. Read the small print, though. Several companies that advertise no long-term contract still require written notice to cancel, before a billing date or a set period ahead. A few contradict themselves, with an FAQ that sets a minimum term while the general terms let either side stop at any time, or marketing that says "no minimums" while the signup form requires a minimum first payment.

What replaces the contract is control. 271 companies describe how buyers manage volume.

Minimums split almost evenly. Of the 227 companies that say anything about minimums, about as many set one of some kind, such as an order size, a deposit or a weekly budget, as advertise no minimum or no commitment, and a few do both for different products. A prepaid balance does the job of a minimum without the argument, because the buyer has already committed the money.

The other side: how lead companies pay their own suppliers

162 companies in the directory buy leads or traffic from publishers, and 94 publish how they pay them. The terms look like invoicing in reverse.

• Paid later. 38 pay monthly or on net terms after the period ends, against 26 that pay weekly or faster.
• Paid only for good leads. 33 pay only for leads that are valid, accepted, qualified or actually sold.
• Thresholds. 11 hold payouts until a minimum balance builds up.
• Paid when the buyer pays. 4 say a payout may wait until their own buyer has paid, and several reverse payouts for leads their buyers reject or return.

This is where invoicing hurts a broker most. A broker who pays suppliers weekly and invoices buyers monthly is lending money to both sides. Take funds from buyers first, and match supplier terms to buyer terms, so you never pay out for leads you have not been paid for. See how to broker leads.

Why Kyle has buyers fund a balance first

Kyle's rule for selling leads is to find buyers before building traffic, and to generate only where a funded buyer is waiting. Funding is what turns a buyer who says they want leads into one who will actually take them. Three things he does not do:

1. No free sample leads

   A free sample costs the seller real media and proves little. The buyer has nothing at stake, so the leads get worked casually, and a weak result gets blamed on the leads. A small funded balance tests the same thing with a buyer who is paying attention.

2. No promised volume by a date

   Traffic does not arrive on a schedule. A seller who promises a set number of leads by a set date either overspends to hit it or apologizes for missing it. Let the buyer set caps and budgets, and deliver what the traffic produces inside them.

3. No invoices

   An invoice means the seller pays for the leads first and hopes to be paid later. With a funded balance, every lead delivered is already paid for, and a buyer who stops paying simply stops receiving leads.

Large first orders: pay in stages

When a new buyer wants a big first order, split it. The buyer funds the first stage, leads are delivered against it, and the next stage is funded only after the first has been used and reviewed. No leads, no next payment. No payment, no next leads. Every lead is still paid for, you learn the real cost and return rate before committing more media, and the buyer limits what they risk with a new seller. A buyer who asks to skip funding the first stage is asking you to extend credit, which is the invoiced model by another name. Our guide to lead pilot orders covers sizing the first stage.

Terms to settle on the first call

• How much the buyer funds before the first lead, and what happens when the balance runs out.
• What counts as a lead: the fields, filters and geography the buyer has chosen.
• The caps, budgets and hours that limit delivery, and who can change them.
• Which leads can be returned, within what set window, and whether approved returns come back as balance or cash.
• What happens to unused balance and bonus credit if the buyer stops, and whether any notice is required.

Buyers ask their own version of these questions. Our guide to questions to ask a lead vendor shows the other side of the conversation.

How Juiced wallet billing works

Juiced builds the prepaid model into distribution. Buyers add funds to a wallet before leads arrive. Each lead is charged when it is delivered, and approved returns are credited back to the wallet. Buyers bid above the seller's minimum and set their own filters and caps, and wallet balance and limits are checked when a bid becomes a sale. See wallet billing and budgets and caps.

The same wallets settle sales in the seller's private marketplace, where leads that miss their first route are sold through Buy Now or standing Buy Orders. The Club, a subscription pool for aged and unsold leads, is billed differently: members pay a recurring monthly fee through the seller's own Stripe account.

Frequently asked