Finders Fee Agreement Made Simple

Increase Your Sales With a Finder’s Fee Agreement

It’s not what you know, but who. This adage is as true today as it has always been. Companies are as reliant as ever on tips from contacts, leading to sales that would otherwise have been out of reach.

The big change in the marketplace is the formalization of finder’s fees. What used to be a friendly exchange of information over a coffee has turned into an industry where finders expect—and receive—substantial sums for the leads they can pass on.

Any business transaction should be accompanied by documentation that regulates it. This ensures that all the parties involved walk away happy with the outcome. A finder’s fee is no different and should be agreed upon in writing before any information changes hands.

is your number one resource for the business documents you need, including a finder’s fee agreement. We can help you learn how to write a contract, provide you with ready-made legal documents, or give you contract templates to make sure your legal bases are covered.

What Is a Finder’s Fee?

A finder’s fee is an agreed sum or percentage that is given to someone for providing information that leads to a business deal.

A finder’s fee could be payable in the following situations:

  • A contact sets up a meeting for you with one of their contacts that is in the market for your product; the meeting results in a sale
  • You urgently need to buy laptops for your business; a contact arranges a great deal for you with a supplier
  • You need a band for a company function; a contact sources, organizes, and books exactly what you are looking for

A finder’s fee can be a fixed amount, a percentage of the deal amount, or something as inconsequential as an informal gift.

Should I Bother To Pay Finder’s Fees?

A personal referral is worth its weight in gold. If you follow it up by doing a good job, it can mean sales revenue or getting something you need without having to do any legwork.

More importantly, someone who offers you a lead or acts as your intermediary to strike a business deal could be encouraged to do it again and become a valuable asset to your business without the encumbrances of being employed by you. Such an asset deserves remuneration.

The more your relationship with an intermediary grows, the more important it is for you to formalize the relationship with a finder’s fee agreement.

What Should I Put in a Finder’s Fee Agreement?

A finder’s fee agreement should be kept clear and concise, but it needs to include a few essentials to make sure both you and the finder are aware of what to expect.

You should include the following points in your agreement:

  1. Agreement duration
  2. Payment amount and terms
  3. Reimbursement of expenses
  4. Marketing guidelines
  5. Confidentiality
  6. Finder’s employment status
  7. Termination mechanics

Agreement Duration

You should set a clear limit on the length of the agreement, and it is prudent to keep it as short as possible in the early stages of the relationship with a new finder.

Payment Amounts and Terms

You should set out how much you are willing to pay for leads and whether it is a percentage of the eventual deal or a fixed amount. You can also include payment terms to make sure you’re not paying out finder’s fees before the deal has been concluded and to make it clear that the fee is only payable on the first transaction, not on repeat business.

Reimbursement of Expenses

If a finder spends money out of their pocket on travel, advertising, or client entertainment, you may wish to set out the reimbursement you are prepared to offer. This should include the same mechanics as you would use with your employees (submission of invoices, receipts, and similar).

Marketing Guidelines

You don’t want a finder generating leads for you while corrupting or misrepresenting your brand, so you should provide marketing guidelines that set out what the finder is allowed to do and say about you. It should be made clear that these guidelines are mandatory and non-negotiable.


Your finders should be bound by a confidentiality clause that ensures they don’t reveal sensitive information about your business to their leads—or, worse still, to your competitors.

Finder’s Employment Status

The finder should be classified as an independent contractor to your company and should be bound by all the legal ramifications this entails.

Termination Mechanics

You should list all the possible reasons for terminating the contract, as well as options for appeals or arbitration. Typical reasons are:

  • The finder starts working for one of your competitors simultaneously with you
  • The leads passed on are of consistently low quality
  • The finder misrepresents your brand
  • Expenses are claimed fraudulently

A finder’s fee adds extra costs to a transaction, but over the lifetime of a client relationship, the once-off fee you pay could be recouped many times over.

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DoNotPay makes it easy for you to draw up legal documents without the expense of lawyers or the worry of doing it yourself.

If you are looking for a legal assistant that is fast and customized, DoNotPay is the place to go. Getting your document is easy—all you need to do is follow these steps:

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  2. Type in the document you are looking for
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Remember that the document is only binding once signed by all the parties to the agreement. You should also get it notarized to ensure complete security.

What Kind of Legal Documents Can DoNotPay Provide?

We are constantly adding new documents and templates, but here are a few examples of what DoNotPay could do for you:

BusinessPersonalReal Estate
  • Lease Agreement
  • Intent To Purchase Real Estate
  • Quitclaim Deed
  • Estoppel Certificate

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