Create_Record_ReferenceField.xml

<?xml version="1.0" ?>
<api method="post">
    <create module=”Potentials”>
        <record>
            <field name="potentialname" value="@name"></field>
            <field name="amount" value="@amount"></field>
            <field name="contact_id" module="Contacts">
                <select>
                    <where>
                        <field name="email" value="@email"></field>
                    </where>
                </select>
                <create>
                    <record>
                        <field name="lastname" value="@lastname"></field>
                        <field name="firstname" value="@firstname"></field>
                        <field name="email" value="@email"></field>
                        <field name="contacttype" value="Lead"></field>
                    </record>
                </create>
            </field>
        </record>
    </create>
</api>