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It’s easy to get distracted by the allure of channel partners and the belief that these relationships will unlock growth. That is rarely the case. Channel partnerships can be a force multiplier for existing momentum, but are not a substitute for founder-led sales.
The best channel partnerships feel like extensions of your own team. The partner knows your product deeply, represents it accurately, and has direct incentives to succeed. They're not just forwarding leads—they're actively selling, supporting, and growing the relationship.
If you haven't crossed $1 million in ARR, your default answer to channel partnership opportunities is typically no. You don't have the resources, processes, or leverage to make these relationships work effectively.
The exception is when a partner approaches you representing an existing, active user of your open source software who has urgent, specific feature requests they're willing to pay for. Not just someone aware of your project—someone actively using it with real pain points. Before you say yes, ask:
If the answers are yes, explore the opportunity. Otherwise, pass and focus on direct sales.
Once you've proven product-market fit and crossed $1 million in ARR, channel partnerships become more viable. But you still need to be selective about which opportunities to pursue and how to structure them.
Resellers buy software products from manufacturers, usually in bulk, and then sell them to their network of clients. Working with a reseller can help you leverage the reseller's established relationships, market knowledge, and sales infrastructure, helping you to enter new markets more efficiently and effectively.
Resellers can add value by offering additional services such as customer support, training, and customization, which can be particularly important for complex B2B SaaS products. They also typically handle billing and collections, reducing the administrative load for the software company. However, working with resellers also has its challenges. It's important to carefully select and manage resellers to ensure they represent the product correctly and maintain the quality of service that end-users expect. Effective communication, ongoing support, and performance monitoring are key to a successful reseller relationship.
For reseller relationships to be effective, concentrate your efforts with 3 or fewer resellers and don’t extend too far. Otherwise, each reseller will be limited in how much they can sell for you and may not invest as many resources in training and support, which diminishes the value they bring. Reseller relationships should be mutually beneficial for the company and the reseller. You invest in them, they invest in you.