Tipalti was founded in 2010 by Chen Amit and Oren Zeev and launched its product in 2011.
The company is a licensed money sender in every state that requires it in the United States, including California, New York, and Texas.
They have been able to significantly automate their pay-outs while providing their customers with a better experience and higher transparency of the whole payment process.
Tipalti is an accounting software financial technology business that provides consolidated accounts payable and remittance automation services for businesses needing to pay their global suppliers.
Tipalti is headquartered in San Mateo, CA with R&D offices in Herzliya, Israel.
Tipalti removes the manual effort and complexity that’s required to pay affiliates and other performance-based partners.
Tipalti integrates with your ERP, performance data, or accepts a payment instruction file, then takes care of securing approvals, making sure funds exist, and paying in the supplier’s chosen payment method (e.g. ACH, wire transfer, PayPal, etc.).
No more logging into individual banking portals or reconciling payments from across multiple accounts.
Tipalti takes care of communicating with affiliate marketers, sending out automated emails regarding payment status or allowing them to update their payment information from a branded portal.
Affiliates are also asked in the very beginning to submit their W-9, W-8, or VAT tax information through a guided interface eliminating an unnecessary hassle later.
Tipalti streamlines the payment reconciliation process for a faster financial close. A single person can do all this in just minutes a day.
Automate the entire process for paying affiliates and influencers around the world.
- Streamline affiliate on-boarding
- Pay affiliates in their currency and desired payment method
- Give partners the option to get paid early
- Collect and validate W-9, W-8, and VAT tax forms
- Screen for OFAC and international “Do Not Pay” compliance
- Dramatically reduce fraud and payment errors
- Make thousands of global affiliate payments in minutes
- Communicate payment status automatically to affiliates
- Integrate with analytics like Everflow, HitPath, CAKE, Tune, and LinkTrust
- Reconcile payments instantly, integrate with ERP or QuickBooks Online in real-time
What Are Affiliate Networks?
Before exploring what an affiliate payment is, it is first important for us to understand what an affiliate and an affiliate network are. To keep it brief, an affiliate is a website publisher.
They have the real estate on their websites that merchant’s or advertisers need for their advertisements.
An affiliate program is a middle-man for affiliates (publishers) and merchant’s that make it simple for affiliates to discover and partake in strategies that work well for their own website.
By doing so, it is mutually beneficial for both parties since it allows websites to generate income and it also helps the merchant expand its reach to a new audience.
There are currently two main models of payment that affiliate networks tend to offer:
Revenue Share Model:
This is where a publisher takes a certain share of the revenue that the merchant generates as their price for putting the ad up on their site.
Fee For Action:
With this model, publishers would get paid for every visitor who completes a particular set of actions on the merchant’s website.
Examples would be taking actions like registering for a mailing list or newsletter, participating in a raffle or survey, purchasing a product or service, etc.
Affiliate networks are usually free for publishers to participate in, however, it’s not the same case for merchant’s.
The typical affiliate network will have an initiation fee, followed by a monthly charge for use of their tools and services.
It’s also not uncommon for affiliate networks to take a small share of any payments made to an affiliate site.
What Are Affiliate Payments?
The easy answer is that affiliate payments are the payments that an affiliate network needs to pay out to publishers participating in the network.
With affiliate payments, an affiliate network is going to come across a number of logistical, operational, and knowledge-based situations.
Optimizing various forms of payment for the global nature of an affiliate network.
This means covering everything from wire transfers, ACH, international ACH, PayPal, check, e-check, Western Union, and so forth.
Having the appropriate infrastructure to provide an intrinsically international affiliate base with payment in their local currency no matter where they are at in the world.
There are also many affiliates that like to receive payment in both USD and their own local currency.
In order to even have the capability to make payments to an affiliate, the affiliate network will have to receive all the information and documentation deemed necessary to successfully make a payment.
In many cases, making a single wire transfer can be cumbersome, let alone making hundreds or even thousands of them every pay period.
Fulfilling all tax requirements, which include receiving and maintaining all paper work related to taxes such as W-9s and invoices.
Also, any necessary paperwork or additional banking information required from countries outside of the US.
It is also necessary to withhold payment from any parties that fail to comply with the tax requirements relative to their local government as it relates to the affiliate network.
Scanning for and complying with OFAC, AML, anti-narcotics, and anti-terrorism regulatory practices.
This is something that mass payers need to be very conscious of as it is possible, and quite common, to inadvertently pay black-listed entities, and thus risk legal and regulatory action from the government.
Because of this, it is important for affiliate networks to scan their affiliates against the main blacklist databases prior to sending out payments.
Risk and Fraud:
There are a number of risk management and fraud prevention procedures that need to be practiced when dealing with affiliate payments.
It’s no secret that where there’s money to be made, fraud will rear its ugly head.
In the world of affiliate networks, fraudulent behavior can cost the industry hundreds of millions of dollars annually.
This is a very real problem that should not be ignored, so it’s important that affiliate networks ensure that they have the infrastructure, know-how, and tools to minimize or fully negate making payments to fraudsters.
Sophisticated mass payout focused companies such as Tipalti have the tools and capability to detect, track, and tag suspicious activities as well as the fraudsters themselves.
Extend early payment offers to affiliate, giving them choice of when they’re paid, without any capital requirements from you.
Eliminate 80% of the time and cost spent managing hundreds or thousands of cross-border performance marketing and affiliate payments
Eliminate affiliate payment processing friction while attracting and retaining your valued performance marketing and influencer partners.
The best affiliates understand how to encourage someone to act on a sale, which is usually through quality content.
This entails articles, videos, social media, newsletters, and captive memberships.
The more successful an affiliate is, the chances are they will be more choose y as to what programs they participate in.
They have a limit to how much they can push the influencer button on one product or service.
With that said, their content has an intrinsic, long-term search engine value.
The Importance of Affiliate Payments:
Affiliate program payments are essential for success.
What other way do affiliates have to go by to continue getting business for you?
E-commerce is a combative space where dozens of retailers offer fairly similar products.
For the affiliate, that means whatever campaign they might have developed for you, they could easily change that ‘Buy’ link to another program if you upset them.
48 percent of affiliates have dropped out of a program because of a payment issue.
46 percent of those who haven’t would.
That puts 69 percent of your affiliate population at risk just because of a payment issue.
Keep The Communication Channels Open:
Communication channels need to be kept open with affiliates.
This is key to engagement and performance.
Regular emails and social posts about new offers, ways to position the product or service you’re selling, new customer stories, and other thought leadership can drive greater affinity to how to sell.
Another available avenue is to use the payment notification emails you already send to let partners know when payments are going out as a vehicle to message and motivate them around your program.
This program is not for the beginner in affiliate marketing.
There may come a time when the services of Tipalti come in to play.
Would love to hear your thoughts about this post or this site in general.
I will answer all the comments on my website personally so drop me a line below if you have any affiliate marketing questions or comments.
Kind Regards Shane.
Keep in mind that we may receive commissions when you click our links and make purchases.
However, this does not impact our reviews and comparisons.
We try our best to keep things fair and balanced, in order to help you make the best choice for you.