ISVs partnering with MSPs | Part 2

ISVs and MSPs: Buddy system for the business world – the mutual benefits of channel partnerships

No one in the business world can go it completely alone. Even if they could, they would be at a distinct disadvantage in doing so. This is because every business has a unique set of resources, access to which may greatly benefit another business (and vice versa). Partnerships between businesses allow this access. So, if you are a small business looking to get your product out in the marketplace, or part of a larger company looking to expand and diversify your product offerings, I suggest you settle in for the next 600 words or so to learn about the incredible benefits of channel partnerships.

ISVs and MSPs | Buddy System for the Business World – the Mutual Benefits of Channel Partnerships

We will be looking at the benefits and logistics of business partnerships through the lens of how they are applied to Independent Software Vendors (ISVs). Why? ISVs are a vital component of the software industry. If you are wondering why this is the case, take a look at our previous blog which will explain ISVs and their contributions in detail. Basically, they produce applications that solve a wide variety of business pains and drive the world of technology forward. However, they cannot do this on their own. The process of getting their apps to the market and then into the hands of customers is difficult and complex for many reasons:

  • Many ISVs are small and do not have the manpower, budget, or know-how to get their app into the marketplace or develop effective marketing materials to allow the app to be successful once they are available.
  • An ISV may not have an established network to pitch their app to once it is ready for market.
  • They do not have the staff to support the users of the app.
  • There are companies that cannot be reached through conventional open markets.

Buddy system for the business world

These types of problems are not unique to ISVs; any business trying to bring a product to market is likely to experience some variation of them. Luckily, the ISVs’ solution can be adapted to a wide range of industries. Let’s take a look at how they have tackled these challenges. The most common–and by far the most effective–solution is utilizing channel partners, specifically in this case: Managed Service Providers (MSPs). MSPs are basically an IT service company that other businesses can outsource their IT needs to, thereby eliminating the need for additional employees and the other costs necessitated by scaling in size. By nature, MSPs are loaded with connections and other business partners that may be interested in purchasing the ISVs’ apps. For this reason, ISVs partner with an MSP to take their app into the MSP’s market and expand their reach into new markets. This partnership also benefits MSPs since it allows them to offer more products to their customers, increase revenue by servicing an additional app, and potentially expand their customer base if new companies are interested in the additional app. If done correctly, this partnership between ISVs and MSPs is a match made in business heaven. As a small business looking for a potential channel partner you must take time to find a channel partner that will benefit from working with you as much you benefit from working with them.

The Mutual Benefits of Channel Partnerships

What does this relationship between channel partners look like? Looking to our running example, ISVs first market themselves to MSPs in the hopes of being integrated into their larger solution portfolio. This is one of the trickiest components of the process, as you will likely be competing with multiple other businesses for the partnership. In addition to selecting the right channel partner, you will need a rock-solid Go-to-Market Campaign to make your case. Take a look at our blog on constructing a stellar GTM campaign to learn the top four essential elements.

If an ISV is successful and an MSP chooses to partner with them, the ISV then trains the sales staff of the MSP so they can effectively sell the product and service it for the consumers that buy it. Without complete understanding of the product by the MSP you will likely get an app that’s not being utilized to its full potential which may decrease the number of potential customers. Too few customers can lead to a complete breakdown in this partnership cycle, as MSPs become more hesitant to partner with ISVs, resulting in less ISV apps making it into the market. In other words, if you would like to sell a product through a channel partner make sure that partner understands the ins and outs of your product. A vendor who is confident in using their product will result in eager customers.

While not every business’ experience will be the same as that of ISVs, there is a lot that can be learned from their situation. If you are a small business looking to sell your product through a channel partner my advice is to find someone who will benefit as much as you, create a strong marketing case for yourself, and (once selected) make sure your new channel partner knows how exactly to use and care for your product.


Lisa Herzinger

With nearly a decade of experience in business management, Lisa Herzinger is a dynamic business professional offering expertise in communication, marketing, and organization. As a skilled business leader, she formulates plans of action in order to achieve positive results. Lisa is an exceptional relationship manager with experience in destination marketing, data management, business operations, and customer service.

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