The largest tech companies in the world share one common trait: they all run a significant part of their business through their partner channels. These partnerships fuel their growth by leveraging the capabilities of independent software vendors (ISVs), solution partners, and value-added resellers (VARs).
For instance, Microsoft has built one of the world’s largest partner ecosystems, with over 90% of its commercial revenue stemming from partners.
Amazon Web Services (AWS), while having a large direct sales force, complements this with a thriving partner program that includes thousands of partners worldwide.
Similarly, Google Cloud has seen a 400% growth in its partner ranks in just two years, emphasizing how tech giants rely on strategic collaborations.
But while these examples may be inspiring, are they relevant to your company? CEOs at smaller tech firms need to determine if they’re ready for a partner program and understand the right moment to launch one.
Here are some key considerations:
Key Goals of a Partner Program
Partner programs can serve multiple objectives, including:
- Increasing product value with partner-provided add-ons
- Expanding market reach via partner-run sales and marketing initiatives
- Driving customer success through solutions and professional services offered by partners
For example, Salesforce’s AppExchange, which boasts over 7,000 solutions, illustrates how partner-driven add-ons can dramatically increase the value of a core product.
Similarly, the AWS Partner Network has enabled businesses of all sizes to extend their reach through joint go-to-market strategies.
Assessing Readiness: Three Key Questions
If you’re assessing your readiness to launch a partner program, it helps to view the situation from the perspective of potential partners. Partners will ask themselves these key questions:
- Is there a competitive advantage? Successful partner programs are built on strong products. Microsoft, for example, has gained a competitive edge with its cloud services, where Azure’s integration with Microsoft 365 offers unique benefits to partners. If your product lacks clear differentiation, potential partners will hesitate to invest in building add-ons or offering services.
- Is there a large enough market? Partners need a significant market opportunity to justify the effort. Google Cloud has expanded its partner community by showing strong growth prospects in sectors like artificial intelligence and machine learning. Your company should demonstrate not only market demand but also sustainable revenue potential for partners.
- Do customers need additional services? High-value professional services such as integration, training, or managed services often define the success of solution partners and VARs. According to IDC, 70% of cloud spending will be dedicated to services and support by 2026. If your product requires significant post-sale customization or integration, that’s a green light for launching a partner program.
Proven Customer Success Stories Are Essential
Potential partners want to see a proven track record before they commit. For instance, AWS gained credibility through early customer success stories, demonstrating how its platform could drive business results. Similarly, Microsoft and Salesforce have consistently shown how partners contribute to successful deployments and customer retention.
Understanding Partner Types
- Marketplace Partners/ISVs care about the size of the market opportunity and the strength of the product’s competitive edge.
- Solution Partners/VARs often look beyond immediate market size. They focus more on delivering high-margin services like integration, training, and custom development—critical elements for high-value partnerships.
When Is the Right Time?
In conclusion, launching a partner program requires a strong product, a large enough market, and the ability to offer partners opportunities beyond simple license margins.
The best programs align partner incentives with long-term customer success.
ScaleTechNow offers an assessment service to help companies evaluate their readiness to launch a partner program. Whether your goal is to expand your product’s value or increase market reach, a well-timed partner program could be your next step in driving growth.