# Referral & Affiliate Program How SHEP pays people to spread the word, legally and operationally. --- ## Two Tiers | Tier | Who | Commission | How They Promote | |------|-----|-----------|-----------------| | **Referrer** (casual) | Any existing user, classmate, friend | $25 per converted sale | Shares their code in group chats, texts, social media | | **Affiliate** (active) | Campus ambassadors, sales reps, content creators, mini-Goats | $30 per converted sale | Actively recruits: in-person pitches, DMs, content creation, campus visits | The difference is effort level, not a legal distinction. Affiliates get a higher payout because they're doing real work. --- ## How It Works 1. Each referrer/affiliate gets a unique Stripe coupon code (e.g., MAGGIE30, GOAT30) 2. The buyer enters the code at checkout and gets $10 off ($119 instead of $129) 3. SHEP tracks which code was used 4. At the end of each month (or after 5 conversions, whichever they prefer), SHEP pays the referrer/affiliate via Venmo, Zelle, or check 5. Revenue to SHEP after Stripe fees: ~$115. Minus $25-30 payout = ~$85-90 net per referred sale. --- ## Legal Requirements ### 1. FTC Endorsement Disclosure (Non-Negotiable) The FTC requires that anyone who receives compensation for promoting a product must disclose the material connection. This applies to: - Social media posts (Reddit, TikTok, Instagram, LinkedIn, X) - In-person pitches where the person earns commission - DMs where someone is proactively recruiting buyers - Content creator reviews or mentions **What disclosure looks like:** - Social media: "#ad" or "#sponsored" or "I earn a commission if you sign up" - Reddit comments/DMs: "Full disclosure: I get a referral bonus if you use my code" - In-person: "I'm a campus rep for SHEP and I earn a commission" - Content creator: "SHEP gave me free access and I earn a commission on signups" **What's NOT enough:** Burying disclosure in a bio link, using vague language like "thanks to SHEP for the hookup," or not disclosing at all. **Your liability:** If an affiliate fails to disclose and the FTC investigates, the company (SHEP) can be held responsible. Include the disclosure requirement in the affiliate agreement and follow up if you see non-compliant posts. ### 2. Reddit-Specific Rules - **Organic posting while earning commission = astroturfing.** Reddit bans accounts for this. The r/barexam and r/LawSchool communities will turn hostile if they discover fake organic promotion. - **What's OK:** Responding to DMs from people who reach out to you. Commenting honestly with disclosure ("I use SHEP and get a referral bonus, full disclosure"). Having your referral link in your Reddit profile. - **What's NOT OK:** Creating posts that read like organic recommendations but are actually paid promotion. Using alt accounts to upvote or seed conversations. Having affiliates pretend to be regular users. - **Rule for affiliates on Reddit:** DMs only. No organic-looking posts. If they comment publicly, they disclose. ### 3. Tax (1099 Threshold) - If any individual earns $600 or more in a calendar year from referral/affiliate commissions, SHEP must issue a 1099-NEC. - At $30/sale, that's 20 conversions to hit the threshold. - Collect legal name and address from anyone likely to cross $600 before they start (or at first payout). - Maggie doing campus visits could easily cross $600. Get her info upfront. ### 4. State-Specific Considerations - No special license needed to run a referral/affiliate program in most states. - New York (where you and Maggie are) has no specific affiliate marketing registration requirement. - California has strict auto-renewal laws (already addressed separately) but no referral program restrictions. - If an affiliate represents SHEP at a law school, they are not practicing law, providing legal advice, or acting as an agent of the school. They're selling a study tool. No bar admission or special credential required. --- ## Affiliate Agreement (One-Pager) Send this to anyone who will actively promote SHEP for commission. Casual referrers (friends sharing a code) don't need a formal agreement, but affiliates who earn real money should sign this. --- **SHEP Bar Prep — Affiliate Agreement** This agreement is between SHEP Legal Inc. ("SHEP") and the undersigned affiliate ("you"). **What you do:** Promote SHEP Bar Prep using your unique referral code. You may promote through personal conversations, social media, campus visits, group chats, DMs, and content creation. **What you earn:** $30 per converted sale made using your referral code. A "converted sale" means a completed Stripe checkout where the buyer entered your code. **Payouts:** Monthly via Venmo, Zelle, or check, or after 5 conversions (your choice). SHEP will provide a conversion count on request. **Disclosure requirement:** You must disclose your paid relationship with SHEP whenever you promote the product. This is required by FTC guidelines. Examples: "I earn a commission if you sign up" or "#ad." Failure to disclose may result in termination of this agreement. **What you cannot do:** - Post fake reviews or testimonials - Create organic-looking social media posts without disclosure - Spam individuals or groups - Make claims about guaranteed score improvement or bar passage - Use SHEP's name to imply institutional endorsement by any law school - Represent yourself as an employee of SHEP (you are an independent contractor) **Independent contractor:** You are not an employee of SHEP. You are responsible for your own taxes. If you earn $600 or more in a calendar year, SHEP will issue a 1099-NEC. **Term:** This agreement is active until either party cancels it via email or text. SHEP may terminate at any time if you violate the disclosure or conduct requirements above. **Agreed:** Name: _______________ Email: _______________ Venmo/Zelle: _______________ Referral Code: _______________ Date: _______________ --- ## Pitch Template for Maggie (Campus Ambassador) For in-person conversations at law schools: **Opening (to a student):** "Hey, are you taking the bar in July? I'm spreading the word about a new essay practice tool. You write an MEE essay inside it, get scored on four dimensions, and see exactly where your analysis breaks down. It was built by a law grad and an engineer at Google." **The hook:** "You can try one essay completely free, no credit card. Takes about 35 minutes. If you like it, I have a code for $10 off." **If they ask about the questions:** "The prompts are modeled on the NCBE's published subject matter outlines. You can also upload any practice question you already have and get graded on that." **If they ask about price:** "$119 with my code. One-time payment, access through July 31. No subscription." **Disclosure (say it naturally):** "Full disclosure, I do earn a referral bonus when someone uses my code. But I'm sharing it because I think it's genuinely useful for anyone doing essay prep." **Leave-behind:** A card, flyer, or phone screen showing: shepbarprep.com + the referral code + "Try one essay free" --- ## Pitch Template for DMs (Reddit, Instagram, Group Chats) For when someone asks about bar prep tools or you're reaching out to a warm lead: "Hey, I've been sharing this essay practice tool for the July bar. You write a full MEE response inside it and get scored on issue spotting, rule statements, application, and organization. It was built by a law grad who passed the Feb 2026 UBE and a Google engineer. You can try one essay free at shepbarprep.com. If you want $10 off the full version, here's my code: [CODE]. Full disclosure: I earn a referral bonus if you use the code. Sharing because I think it's genuinely worth it for anyone doing MEE prep." --- ## Who to Recruit First | Person | Type | Why | Expected Sales | |--------|------|-----|---------------| | Goat | Content creator | ~500-1,000 reach, bar prep audience, already committed | 10-20 | | Maggie | Campus ambassador | Motivated, available, Brooklyn location near BK Law + others | 10-30 | | 2-3 3L friends at other schools | Casual affiliates | Access to group chats, low effort | 5-10 each | | 1-2 TikTok bar prep creators | Content creators | Audience reach, authentic reviews | 5-15 each | | Active Reddit connections | DM-based affiliates | People who've DMed u/sheppyrun about bar prep | 2-5 each | --- ## Tracking and Operations **Stripe setup needed:** - [ ] Create unique coupon codes per affiliate (each gives $10 off to buyer) - [ ] Track redemptions per code in Stripe dashboard or export - [ ] Alternatively: use a simple Google Sheet/Notion table if Stripe reporting is limited **Monthly operations:** 1. Export Stripe transactions with coupon codes 2. Tally conversions per affiliate 3. Send payout via Venmo/Zelle 4. Update tracking sheet 5. Check: anyone approaching $600? Collect 1099 info. **Communication:** - Group text or Signal group with active affiliates - Share weekly conversion counts ("your code had 4 sales this week") - Share which pitches are working ("campus visits are converting at 2x DMs") --- ## Budget Impact | Scenario | Affiliate Sales | Payout | Gross Revenue | Net After Payouts | |----------|----------------|--------|--------------|-------------------| | Conservative (5 affiliates, 50 total sales) | 50 | $1,500 | $5,950 (at $119) | $4,450 | | Moderate (8 affiliates, 120 total sales) | 120 | $3,600 | $14,280 | $10,680 | | Aggressive (12 affiliates, 250 total sales) | 250 | $7,500 | $29,750 | $22,250 | At $30 payout on a $119 sale (after $10 buyer discount), your effective CAC is $30. Stripe takes ~$3.75. Net to SHEP per referred sale: ~$85. That's healthy at any volume. --- ## Decisions ### Affiliate Program Page: Not on the Landing Page The landing page has one job: convert visitors into free diagnostic users, then into $129 buyers. An "earn money promoting us" section talks to a different audience (promoters, not students) and dilutes the conversion funnel. It also tells every student about to pay $129 that discount codes exist, pushing them to hunt for one instead of buying at full price. **What to do instead:** Keep the affiliate program behind the scenes. Recruit through DMs, personal outreach, and Maggie. If a public-facing page is needed for recruiting affiliates, put it at `/partners` or `/referrals` as a standalone URL. Do not link it from the main nav or the landing page. ### Swag: Stickers Only Order 200-500 laptop stickers from StickerMule or Sticker Giant. $50-100 total. Design: sheep logo with lightbulb, "shepbarprep.com", and "Essay. Score. Breakdown." on it. **Distribution:** - Give a stack to Maggie for campus visits - Give a stack to Fordham classmates - Ship a few to any school that does a pilot - Include one in any welcome email or onboarding flow (digital version) **Skip for now:** T-shirts, mugs, hoodies, tote bags. Stickers are the only swag with a real cost-to-impression ratio at this stage. Revisit after $50K in revenue.