Every company recognizes the value of working with partners, however within SaaS it’s not always a viable model in your early stages. Building a successful partner program is a long term strategy and therefore revenue is not always instant. I recently joined InsideSales.com after spending several years running partner programs at Authorize.Net, a Visa company. I began building the referral partner program in 2008, twelve years after they launched. Today at Authorize.Net, the majority of new sales are influenced by a partner. 

Now at InsideSales.com I am responsible for launching the partner program, also about 12 years after the company was founded. 12 years is obviously not the magic number to invest in your partner program, but there are many reasons why SaaS companies wait until they have reached key milestones before embarking on the partner journey.

Defining partner programs

There are many definitions of partner programs such as resellers, referral partners, affiliates, consultants, channels and alliances. Since each company may apply different definitions to each I use the term partner program or indirect sales channel to represent these partner types generally. At the end of the day a partner program enables companies and individuals outside of your organization to sell on your behalf.

Challenges with Indirect Sales

One of the first challenges is addressing cost of sale. Not only do you have to pay people to manage partners, you also give up a % of revenue to the partner which impacts already thin margins. You will also need to make strategic decisions to determine what type of program you want to build, referral vs reseller for example.  Once you launch your program, channel conflict will inevitably arise and you will need to establish clear rules of engagement with your sales teams.

When is the time right to launch your partner program? Consider these 7 milestones:

1. You are growing fast and want to go faster
2. You want to reach a broader audience
3. You are generating recurring revenue and can invest for the long term
4. Your solution or service is built on a common platform(SalesForce, Microsoft, Oracle)
5. You have nailed your sales process and can train others
6. You have a complex implementation that partners could help with
7. You have something to give back(partnering is not a one way street)

Benefits of Indirect Sales

If the time is right, establish a team that understands the value of working with partners and begin building the program foundation. Focus on strategic partners that believe in you and want to help you succeed. Once your program matures you will find that you have a qualified and driven outside sales team at your disposal who will be a brand ambassador and can drive opportunities that you couldn’t find without them. 

How did you decide when the time was right to launch your partner channel?