2-Tier Lead Gen Business Model?

Since I have no clue as to what niche you are in, it is hard to recommend anything.

You mentioned optin form, so CPA might work as long as your current conversion rates on the optin form are decent. Weak conversion rates will only get weaker if you engage in CPA methods. If you do go CPA route, take the adwords budget that you are currently using, figure out how much your cost per actualized acquisition is, chop that into about 1/25(minimum) cost, then transfer that cost to a CPA campaign offering. So if your actualized cost per acquisition is 100 bucks, make your CPA offer a 4 dollar offer. This will give you the buffer needed to engage a lead gen cpa campaign with all of the weak leads that will be sent through the system.

If your niche/service can be done through phone call lead gen, then I would go with a pay per call affiliate system. Since you can screen candidates a bit more strictly, you can have stronger restrictions on what you pay out on and people that do pay per call put a little more into their efforts due to the nature of the business of Pay per Call.

Are you being paid by this company per lead, flat rate, on contract, commission? The reason why I ask is are they flipping the bill to get the leads driven and you are just facilitating the strategies for them or are you completing the lead gen strategies your self with them only accepting leads(not doing any work themselves)?

IF you are doing all the work and taking on the actual cost of the lead gen, then I would stay away from CPA or affiliate and continue to peruse things like ad listings, PPC, social PPC, video, etc etc all of the fixed cost acquisition methods. Since the cost of the CPA/Affiliate might eat to much into your own profit margins, while other methods that are directly under your control can be managed easier. If they are flipping the bill for the work to be completed to get the leads, then I would just run the whole gambit of IM strategies to see what sticks in your market.

Cagey, thanks for the detailed reply. I tried to keep it open ended regarding niche because it will need to be adjusted based on the variables you mentioned.

Let's take a bankruptcy lawyer and a HVAC company for examples.

Lawyer gets less leads but they're worth more. The inverse for HVAC except the occasional business lead, but he prefers those.

All expenses are handled by my clients. I'm given a monthly budget and specify if/when it goes over that. My earnings are percentage. I'm wanting to cut my percentage by sharing it with affiliates or CPA marketers who can drive appropriate traffic.

There would certainly need to be a process to verify lead quality, as with any business using this model.

You know of any CPA networks that deal with local businesses? Might be an opportunity there, if not...