Startup Referral Systems

7 Dec

I’ve always had a love for a well-designed friend referral system. Indeed,when I was working for Rocket Internet, one of my tasks was to re-design the invite-a-friend system for More on that later…

If you’re really clever/lucky you create such a shareable system, that you end up with a viral coefficient of over 1.0 (meaning each user, on average, brings 1 additional user to the service) and… woo-hoo… hockey stick growth!* Hopefully this is something that I’ll be able to apply to Satago.

So here are a few friend-referral systems that I think are particularly good or notable. Upfront disclosure – links are my referral links, since, well, that’s kinda the point of them.


One of the most successful recent friend-referral systems was Dropbox’s. Like many of the best referral systems it was a mutual-benefit system, meaning both the inviter and invitee received benefit from using the referrer’s link. When I first signed up to Dropbox, you would get your first 5GB of storage for free, but if you used a referral link from a friend you would get an extra 250MB storage, and of course the person who gave you the links for get an extra 250MB. It meant people were posting their Dropbox referral link all over the place to try and get extra storage, and people who were signing up were actively seeking out referral links.

Dropbox's invite system has got more generous recently.

Dropbox’s invite system has got more generous recently.

One Kings Lane & Westwing

As the original “inspiration” for Westwing, One Kings Lane gives us the standard flash sales shopping club model whereby everyone you invite gets a $15 voucher and for every shopper that you invite and makes a purchase, you receive a $15 voucher. However, One Kings Lane’s invite page is hideously designed.

At Westwing we had exceptionally high design standards, which sometimes made it difficult to get new features implemented quickly. I don’t think my final designs for the Westwing invite page ever got used, but I just checked the website and they have now updated their invite page and it looks really, really nice – much better than One King Lane’s. However the basic model is the same – you get a voucher, I get a voucher.

Westwing's current invite page. Beautifully designed.

Westwing’s current invite page. Beautifully designed.

One Kings Lane invite page. Hideous.

One Kings Lane’s invite page. Hideous.

That brings us to, whom we unsuccessfully tried to “emulate” with Bamarang. I especially liked Fab’s invite friend system, because they not only had the usual shopping club voucher system, but they also added a kind of “prestige” system, whereby users who successfully invited lots of users would receive extra credit and free shipping. I think with Fab’s voucher credits they were especially good since they are additive, whereas usually with other websites you can only spend one voucher per transaction.

Fab invites

Fab invites

What’s more with is that the whole site is designed to be shared – and every time you share something from Fab, to Facebook or Twitter, it is automatically a referral link, turning a natural instinct to share in to a potential source of free credits.

Big money

What I consider one of the most generous, or at least potentially lucrative, friend-referral systems, is from the UK’s Seedrs – the crowd-equity funding platform that I used to raise investment for Satago. If I refer someone to Seedrs who goes on to make an investment in one of their listed startups, I receive equivalent to 5% of their investment to make my own investments. So if someone logs on and makes £10k investments I will get £500 to invest in startups that take my fancy. Of course the chances are the startup will not be the next Facebook… but there could be some big wins there (like Satago of course!). Wow!

I’ve already suggested to Seedrs that they should allow a registered user to decide whether they take the whole 5%, or if it can be split with the person referred so that there is an incentive to use the referral links it becomes a mutual referral system, which I think always works better.


I just logged in to my AirBnB account to book some accommodation in Dublin and found that I had three £16 vouchers because three different people had signed up to AirBnB via my referral link. I don’t even recognise one of the links, so maybe that came via Twitter. Currently, AirBnB is not a mutual referral system, meaning only I get any reward for using the link, although I think AirBnB have gone through periods (maybe when they were newer) of making their referral system mutual. AirBnB does encourage you to share the listing of the place you have stayed at to Facebook, and that link is (presumably) also a referral link.


Transferwise is an excellent service for currency transfers. Started by some of the guys behind Skype, it is both genius and super-simple – the money you transfer from A to B never actually moves – they just match it against people moving money in the other direction, thus totally removing the costs of transfer. Clearly Transferwise benefits from having as many people using the system as possible (i.e. to make the service actually work) and hence have quite a generous referral system. Currently, if you refer three people to the system who actually use it, they give you £50 in cash. In fact Transferwise was my inspiration for this post as I made my 3rd referral this week and got my £50. Woo-hoo! I have heard of some people referring dozens of people to Transferwise and making quite a bit of referral cash.

Honourable mentions

Not particularly inventive, but the host I use for the Satago WordPress blog is TSOHost, and partially the other reason I wrote this blogpost. I found them due to a recommendation on someone else’s blog and made sure I used their referral link so they would get some reward. When I set up my girlfriend’s NGO, Kids Have a Dream, on a new website, I used TSOHost again but used my own referral link, meaning I made £7.50. Huzzah!

Lastly, I hope that the referral system in Satago will work – for every person you invite to use the system, you get credits which you can use to get data reports out of the system.

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