Last Updated: June, 2024
At Kayzen, there are two billing options:
Option I - Making a security deposit to receive a credit line for Media Spend
Option II - Prepayment for Media Spend
Option I - Making a security deposit to receive a credit line for Media Spend:
The credit line represents the maximum available balance you can freely spend on our platform until you pay an invoice. Once you run campaigns, you will use up your available balance. Whenever you pay an invoice, your available balance gets topped up again by the Media Spend. The credit line allows you to run campaigns while paying for the Media Spend afterwards. Your credit line is determined through two factors: the amount of security deposit provided and a credit multiplier.
Your credit line is thus calculated by the equation = security deposit x credit multiplier. The credit multiplier represents an internal risk scoring based on our own assessment of your credit profile and can range from 1-5, usually starting between 1 and 2. Once we experience punctual and reliable invoice settling, your credit profile with us can enhance and the credit multiplier might increase over time, leading to an increased credit line. Another way to increase your credit line is to provide additional security deposits.
Let’s use a numeric example: If we determined the credit multiplier to be 1.5 and your required credit line for media spend would be $ 45k, then the one time security deposit required to be made amounts to $ 30k (30k security deposit x 1.5 credit multiplier = $ 45k credit line). If you then spend $ 35k, you’ll have $10k remaining. After paying the $ 35k invoice, your credit line will be topped up by that amount again.
The following points are important to understand:
Your balance will be topped up if any of the following events happens:
once an invoice is paid (relevant event: money received on our bank account);
we grant an increased credit multiplier based on good payment history;
you increase your security deposit
Your balance depletes based on any of the following events:
Real-time based on media spend on your account (second by second);
we grant a decrease in credit multiplier based on bad payment history
Please note that the best way to both maintain a sufficient balance and a healthy credit line is to continuously pay your invoices in time. Failure to do so will have negative repercussions on your credit score and thus your credit multiplier.
Note that in the following case it will be sensible to pay invoices ahead of their stipulated due date:
When you grow / scale your spend faster than anticipated, you may run into a situation where your balance nears depletion (i) before the due date of your Kayzen invoice or (ii) even before you have been invoiced by Kayzen.
For case (i) we recommend you pay your invoice promptly ahead of its due date. Note that it can take a few days for the wire transfer to hit our bank account, and if weekends or bank holidays are in between it can even take longer.
For case (ii) we can switch your account to a more frequent billing cycle. Our billing is once per month by default, but can be increased to twice per month or even weekly for high spending advertiser accounts.
Option II - Prepayment for Media Spend:
If you opt for our prepayment billing option, you'll have to estimate your own spending each time in advance. Once prepayment is made and the amount is reflected in our bank account, we'll promptly top up your account with the prepayment amount for you to run your campaigns.
The following points are important to understand:
Your balance will be topped up if any of the following events happens:
once a prepayment invoice is paid (relevant event: money received on our bank account)
Your balance depletes based on the following event:
Real-time based on media spend on your account (second by second)
For both Option I and Option II, in order to not run out of balance on your account, we recommend taking required action at least seven (7) days before your account is expected to run out of funds. We have a reminder formula that will trigger an email and UI notification 7 days before the balance is depleted. Please also instruct your own billing team to always include the invoice number in the bank transfer details for reconciliation.