Performance-based pricing
Part or all of your fee depends on hitting an agreed result.
Best for: Confident specialists with control over the metric being measured.
Avoid when: The client's own execution, budget, or timeline determines whether the metric moves.
How it works
You tie some of your fee to an outcome — a percentage of revenue generated, a bonus on hitting a target, a share of savings. Insist on a base fee that covers your costs, and be ruthless about defining how the metric is measured and by whom.
What it looks like
£2,000 base plus 10% of incremental revenue over the next six months, measured against an agreed baseline.
Example project
A paid search overhaul with upside
An established retailer with clean attribution and a £40,000 monthly ad budget. You take £3,000 upfront plus 10% of incremental revenue above an agreed three-month baseline, measured in their analytics and capped at six months. The base covers your costs; the upside pays £11,000.
Where it wins
- Removes the client's perceived risk almost entirely.
- Uncapped upside when the work lands.
- Signals total confidence in your ability.
Where it hurts
- You absorb risks you often can't control.
- Attribution arguments are common and ugly.
- Cash flow can be a long way behind the work.
Performance-based pricing: frequently asked questions
Is performance-based pricing a good idea for freelancers?
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It can be, if you control the metric and the client executes. It's a poor idea when your work is one input among many, when attribution is contested, or when you need the money before the results arrive.
Should I take equity instead of payment?
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Rarely, and never instead of a base fee that covers your costs. Most equity is worth nothing. Treat it as upside on top of a real price, and only where you would have taken the work anyway.
How do I structure a performance-based deal?
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Base fee plus upside. Agree the metric, the measurement method, the baseline, the reporting window, and who owns the data before you start. Put a floor under it so a bad quarter doesn't cost you money.
What percentage of results should I charge?
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5 to 15% of incremental value over an agreed period is a common band, higher when your base fee is low. Whatever you agree, cap the measurement window — open-ended shares are hard to enforce and harder to invoice.
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