Reward Structures

Designing Your Reward Structure

Structure Type 1: Milestone-Based

• Fixed reward for achieving KPI
• Example: "$100K reward pool for hitting 10,000 users"
• Clear and simple
• Easy to understand value prop

Structure Type 2: Revenue Share (Time-Limited)

• Percentage of revenue for defined period
• Example: "50% of first 6 months revenue"
• Aligns incentives for ongoing promotion
• Communities benefit from product success

Structure Type 3: Revenue Share (Perpetual)

• Ongoing percentage of revenue
• Example: "20% of lifetime revenue"
• Long-term partnership model
• Ongoing community alignment

Structure Type 4: Tiered

• Multiple milestones with escalating rewards
• Example:
  • 5,000 users = $25K
  • 10,000 users = additional $50K
  • 25,000 users = additional $100K
• Creates momentum through campaign

Structure Type 5: Hybrid

• Combine fixed and percentage-based
• Example: "$50K at launch + 25% of first year revenue"
• Balances immediate and long-term value

Calculation Examples

Example 1: SaaS Tool

• Product: $50/month subscription service
• KPI: 1,000 paying customers
• Reward: 50% of first 6 months revenue
• Potential payout: 1,000 × $50 × 6 × 50% = $150,000

Example 2: E-commerce

• Product: Average order value $100
• KPI: 5,000 orders
• Reward: 30% of revenue
• Potential payout: 5,000 × $100 × 30% = $150,000