The reward's face value is what the customer sees. What it costs you, and what it teaches, decide whether the loop pays.
Every loop pays the inviter in something. Pick it on three numbers: what it costs you per dollar of value the customer sees, how many rewards actually get used, and how many referred customers would have bought anyway. The best currency costs you a fraction of what it's worth to the customer and makes them use the product more.
Part two's companies spread across the whole range. PayPal paid cash and had to stop. Dropbox paid in storage it made itself. Whatnot's sellers fund the giveaways. Binance pays a share of fees already collected. OVRLND pays in entries it can print for free, inside rules that make the printing legal.
| Currency | Your cost per $1 the customer sees | What it teaches | Seen at |
|---|---|---|---|
| Cash | $1.00, plus fraud | That you pay people to show up | PayPal, 1999–2000 |
| Discount or store credit | Cost of goods on the orders it's used on, plus margin given away on orders that were coming anyway | That your price moves | Most DTC programs |
| Product | Cost of goods and shipping | To use more of it | Dropbox storage; a refill, a sample |
| Share of revenue | A slice of margin already earned | To bring people who buy | Binance referral |
| Status and access | Near zero, if the scarcity is real | To stay and buy more | Binance fee tiers, Launchpad; early access |
| Chance at a prize | Near zero to print; legal work to issue | To play again | OVRLND entries; Whatnot giveaways |
| Partner-funded | Nothing, if the partner gains | That growing you grows them | Whatnot sellers |
Pay in a currency you can print.
Store credit looks like the product row and behaves like the cash row. A $15 credit costs you your cost of goods on the order it's spent on, if it's spent. That part is cheap. The expensive part is the orders that were coming anyway: the friend who was going to buy, and the inviter who would have reordered at full price and now pays $15 less.
That second cost never shows on the referral dashboard, which is why credit programs look better than they are. The calculator below asks for it directly.
OVRLND sells entries into vehicle giveaways: $1 buys 10. It can also grant entries for free, and does, like the 150 free entries in its signup offer. Printing an entry costs the company almost nothing, and to a customer who wants the truck it's worth real money. That makes entries close to the perfect loop currency.
The price is legal, not financial. In a paid sweepstakes every grant of entries is part of a legal structure, and free entries have to be available on equal terms to people who don't buy. A referral bonus paid in entries needs a clause in the official rules and a free path to the same grant. My 2026 plan for OVRLND put it bluntly: entries cost nothing; whale trust doesn't.
Cash 1.00. Credit or product: your cost-of-goods share, e.g. 0.35.
From a holdout if you have one. Otherwise assume a third.
With the example numbers, a $15-each credit costs about $6.30 per referred customer and $9.40 per incremental one, about a fifth of a $45 acquisition cost. The same face value in cash would cost about $45 per incremental customer, the same as buying one. That's PayPal's problem in one line.
Split new inviters for a quarter between your current reward and a product reward of the same face value. If the current reward wins on cost per incremental referred customer who orders twice, keep it: your customers value your price more than your product, and the loop should say so.
This is one chapter of Close the Loop, which is free and readable in full on a single page with no form in front of it.