If the payout was on trials - there are not many paysite sponsors that have a
per-trial net-net VPS of over $100. There would be absolutely zero profit from all of those joins for the period in question. So, if it were even 1000 joins per day for 30 days, that's $3,000,000 in payout (HUGE cashflow crunch) - with a net-net loss of at least $300,000 - $1,000,000 (depending on VPS) which would be realized over say a 12 month period.
So for any sponsor to do this they would need several million dollars of cash just sitting there, on top of normal operating expenses. In addition, assuming a per-trial VPS of, say, $70 and a normal payout of $30, with a net-net profit of $20 per join (payout + variable costs + fixed costs), the program would have to pick up an ADDITIONAL 45,000 joins on top of their normal business before breaking a profit.
So, give a 12 month time horizon a program would have to add, on average, 134 NEW joins per day over an 11 month period to BREAK EVEN on the $900,000 net loss of the promo (using $100PPS / $70 VPS / $20 net profit per join).
This does not even factor in the time-value of money on $3 million dollars, even at say 3% interest over 12 months that return is (compounded monthly) about $91,000. That's not even including the opportunity cost of $3 million dollars (which could be invested in, say, purchasing one or several other profitable businesses).
I run all the promos here and I do this math all the time. A $100 PPS promo would be the ideal way for me to put us out of business in 30 days
