How to Structure Payment Terms (and avoid disputes before they start)

Starting HowMuch gave me a lot of time to think about the patterns that show up across a career in financial comparison. One of those patterns, which I have now seen from both sides, is invoice disputes. Not the nuisance kind that resolve in a single email. The kind that stretch on for months, consume disproportionate amounts of time, and teach you things you wished someone had told you earlier.

I have been involved in two significant invoice disputes before launching HowMuch. Both were instructive, Neither were comfortable & both fed directly into the line I wrote in the Month 2 diary: if there is one thing I carry into every future partnership agreement, it is this. Know when you will get paid before you agree to anything else.

The partner who went radio silent

The first was a new major partner who came in quickly and spent significantly. They were the missing piece of the puzzle, to really grow a key vertical.  That kind of fast-moving commercial relationship feels like a success story when it starts. Revenue is landing, the relationship is growing, and the assumption is that the volume justifies any friction that might come later.

Then the payments started to slip.

What made this situation unusually hard to read was the pattern of partial payments. Every time the relationship felt like it was deteriorating beyond recovery, a proportion of what was owed would arrive. Not enough to settle the account, but enough to suggest the intention was still there. Enough to make turning off the lead flow feel premature. Enough to keep the conversation going a little longer.

That cycle repeated for the better part of a year. The partial payments were not goodwill. They were, whether deliberately or not, a mechanism for extending the relationship on terms that were moving steadily against us. By the time the company wound up, the outstanding amount was significant and not recoverable. We took the hit directly.

The lessons feel obvious in retrospect. A credit check on a new commercial partner costs almost nothing and takes minutes. Payment terms that include specific triggers (what happens at thirty days overdue, at sixty, at the point where lead flow suspends automatically) are not aggressive. They are standard. And the partial payment pattern, which feels reassuring when you are inside it, is worth treating as a signal rather than a resolution. A partner who pays you half of what they owe is not a partner who is going to pay you the rest. They are managing the relationship on a declining timeline.

There is also a question of how quickly you turn off the lead flow. It is the hardest call to make when a relationship is in this kind of limbo, because turning it off feels like the action that ends it. The reality is that continuing to generate revenue for a partner who is not paying you is not a relationship worth preserving on those terms. The lead flow should have stopped far earlier than it did. The cost of that hesitation was real.

The long-term partner who used an invoice as leverage

The second dispute was different in almost every way. This was a long-established partnership, years of successful commercial history, a relationship built on mutual growth. When a new partner joined the platform and click share redistributed, the long-term partner was unhappy. That unhappiness expressed itself through an unpaid invoice.

Looking back, the dynamic was clear early on. This was not a payment issue. It was a negotiating position. The invoice was leverage for a conversation about their commercial position that they wanted to have and we were resisting.

The mistake was treating it like a payment issue for too long. Six months of chasing, conversations, and an ongoing willingness to keep the dialogue open in the hope that the relationship would reassert itself. One legal letter, clearly drafted, with the documentation to back it, and the invoice was paid within forty-eight hours.

The relationship effectively ended at that point. That was the cost of allowing an invoice dispute to run for six months rather than six weeks.

The lesson is both practical and uncomfortable. The length of a commercial relationship is not, on its own, a reason to extend more patience than the situation warrants. If anything, a long-standing partner who knows your payment terms and has operated within them for years is harder to give the benefit of the doubt to when they stop. They know the rules. When someone uses a legitimate debt as commercial leverage, the fastest resolution is almost always to treat it as the legal matter it is, promptly and professionally. The documentation was what made that letter effective. Years of email chains clearly establishing the commercial terms, the amounts invoiced, the chasing activity. The paper trail was watertight. That made the legal step straightforward and credible.

What commercial terms written for today cannot do

Both situations had a common thread that I think about when structuring commercial agreements at HowMuch.

Commercial terms written for the relationship as it exists at signing are not always adequate for the relationship as it will exist two or three years later. Long-term agreements with renewal mechanics can create genuine ambiguity about what either party is entitled to as the market changes around them. What looked like a clearly agreed arrangement at the outset can look contested from both sides when the circumstances shift.

That ambiguity is what gave the second dispute its staying power. If the commercial terms had been specific about what happened to click share allocation as the platform grew and new partners joined, the negotiating position the long-term partner was trying to establish would not have had the same traction. The invoice dispute was downstream of a contractual ambiguity that was never properly addressed. Clearer commercial terms at the start do not prevent disagreement. They do significantly reduce the surface area for it.

The controls that would have changed both outcomes

Running through both situations, there are a small number of things that would have changed the outcome materially in each case.

Credit checking new commercial partners before onboarding them. Not as a sign of distrust, but as basic due diligence that any established business applies to its client relationships. A new partner willing to spend quickly is not automatically a reliable payer. The two things are not the same.

Payment terms with automatic consequences. Not chased manually at thirty days and sixty days, but terms that specify clearly what happens and when without anyone needing to make a judgment call. The hesitation around turning off lead flow in the first situation would have been removed if the contract had already decided the question.

Escalation timelines. In the second situation, six months elapsed before legal intervention. The legal intervention worked in forty-eight hours. The six months served almost no constructive purpose beyond exhausting both sides. Setting an internal trigger for when formal steps begin, and committing to it, means the decision is made once rather than repeatedly.

Documentation discipline from day one. Every material conversation confirmed in writing, every commercial change documented, every chasing action logged. The paper trail is only valuable if it exists, and it is far easier to maintain it consistently than to reconstruct it when you need it.

What this changed about how I approach commercial terms

Both of these disputes happened before HowMuch. They are part of the commercial education that any career in this industry provides, often at cost. But they are also the reason that payment terms, documentation, and escalation protocols sit near the top of my priority list when structuring any commercial relationship now.

The Month 2 diary covers the experience of negotiating HowMuch's first proper partnership agreement and why I brought in a legal expert rather than relying on AI or instinct. The short version is that the first agreement to underpin all future agreements is not the place to cut corners. The longer version is that I had seen what happens when you do.

For anyone working through a similar situation now, the practical steps are covered in our guides to how to chase an unpaid invoice and how to resolve an invoice dispute. The principle underneath those steps is the same one that cost me time and money to learn. Act earlier than feels comfortable. Document everything. And do not confuse preserving a relationship with prolonging a problem.