When should we add partners?

After direct sales has a repeatable playbook (>$10M ARR typically), when geographic or vertical expansion requires local presence, or when a specific partner has bundled offerings that unlock deals you can't win alone.

Are cloud marketplaces worth the fee?

For enterprise deals: yes. The 3-15% fee is offset by faster procurement (30-60 days shorter cycles) and access to committed cloud spend. For SMB self-serve: usually not — direct billing is simpler.

How do we handle channel conflict?

Clear deal registration rules, defined account segmentation (partners own SMB, direct owns enterprise, or vice versa), and explicit compensation neutrality — reps get paid the same whether the deal closes direct or through partner.

Channel Strategy: Direct vs. Partner vs. Marketplace (2026)

Channel strategy determines how your product reaches customers.

Channel Strategy: Direct, Partner, and Marketplace Distribution

Distribution channels determine both economics and control. Direct sales gives full margin and customer relationship but scales linearly with headcount. Partner and marketplace channels scale faster but surrender margin and customer data. Most companies use a single dominant channel and add secondary channels only after the primary one is proven.

Direct sales

Your team sells directly to end customers. Maximum margin (no partner cut), full control of customer relationship and data, ability to iterate pricing and packaging. Downside: scales linearly with headcount, high CAC for enterprise, limited geographic reach without local presence. Best for: high-ACV enterprise, complex products requiring solution engineering.

Partner and reseller channels

SIs, VARs, and resellers sell your product alongside services or bundled offerings. Typical partner margins: 15-30% for resellers, 30-50% for SIs including implementation. Scales through partner headcount, unlocks geographies and verticals you can't reach directly. Downside: partners control the relationship, deal registration conflicts, weaker product feedback loop.

Marketplace distribution

AWS Marketplace, Azure Marketplace, Salesforce AppExchange, and vertical marketplaces. Benefits: procurement-friendly billing (uses existing cloud commit), discoverability, faster deal closure. Costs: 3-15% marketplace fee, less customer data, limited pricing flexibility. Increasingly required for enterprise sales — 40%+ of enterprise SaaS transacts through cloud marketplaces in 2026.

Sequencing channels

Start with one channel. Prove product-market fit and unit economics through direct sales or PLG. Add secondary channels only when: primary channel has repeatable playbook, partner economics work at scale, and you have partner-management capacity. Adding channels prematurely fragments focus and creates conflicts.

Frequently asked questions

When should we add partners?: After direct sales has a repeatable playbook (>$10M ARR typically), when geographic or vertical expansion requires local presence, or when a specific partner has bundled offerings that unlock deals you can't win alone.
Are cloud marketplaces worth the fee?: For enterprise deals: yes. The 3-15% fee is offset by faster procurement (30-60 days shorter cycles) and access to committed cloud spend. For SMB self-serve: usually not — direct billing is simpler.
How do we handle channel conflict?: Clear deal registration rules, defined account segmentation (partners own SMB, direct owns enterprise, or vice versa), and explicit compensation neutrality — reps get paid the same whether the deal closes direct or through partner.