Cloud Software Association

Growing a channel is much more difficult for smaller startups.

This is something CloudApp’s Sophia Sithole talked about at SaaS Connect. At the time, her responsibilities in the company were business development and partnerships.

Here’s what CloudApp learned from growing channel sales.

Which channel is best for you?

The first roadblock that many businesses hit is that they don’t really understand what business development is. They don’t take on the idea of building out a sales strategy or a channel strategy.

And even when they do think of it, they’re worried about the risks.

These risks can be worth it, however, if you’re methodical. Go through each and every channel until you find the right one for you. This will help you grow and expand your business.

What do people need to do to develop channel sales?

It can be difficult to develop channel sales if your team doesn’t go into it with the right mindset. That’s especially so in companies where there isn’t a dedicated marketing person or business developer.

You’re going to have to work across different teams. Marketing teams will need to create collateral, dev teams will need to create new solutions, and sometimes you’ll be working with outsourced sales teams, as well. Managing these kinds of relationships is critical.

Who do you want to partner with?

Having a reason for starting a channel strategy will help you when it comes to setting measurable goals. From there, you can think about which kinds of partners would be able to help you achieve these goals.

For example, CloudApp wanted to increase its number of business and team accounts, as well as the number of new integrations installed. As a result, the company’s initial focus was affiliate resellers, distribution partners, VARs and integration partners.

What does partnering look like?

An important step is figuring out what partnering looks like for you.

Understand which revenue model makes sense for the different channels and what your side of the partnership would bring to the other companies.

This means asking tricky questions, like the following:

1. Are you going to have a revenue-sharing scheme set up?
2. If so, then what are some decent margins to have in place?
3. Are you going to sell your solution through a reseller or a distributor?
4. Are you going to offer any discounts?
5. What would make it more attractive for larger users to go through those partners?

Ultimately, figure out how much support you’re going to provide. Also, it’s important that you don’t compete with your partner.

What else can you do to forge successful partnerships?

You’ll probably run into some challenges along the way. For example, you might find that your dev team is too busy to focus on integration. When this happens, you should focus on partnerships that don’t require engineering.

Make sure you’re giving partners the right incentives. Give them what they actually want and need from you, and make sure you’re providing value for them if you want them to provide value for you.

Finally, be sure that you know who your ideal partner is. This will ensure you’re actually partnering with the right people.