Lunch and Learn and Starving to death

Channel partnerships look easy. That's what makes them hard. The easy version: your service complements theirs, so you sign a reseller contract, schedule a lunch-and-learn, and wait for revenue.

It almost never works.

The contract goes on a shelf. The revenue share and joint marketing terms become hopes and dreams. The lunch-and-learn slips to next quarter, then the next. Nothing moves because nothing was ever really moving.

Recently, a CEO asked me to help with her channel program. Her channel lead — call him Brad — kept signing partners. But they weren't selling any of the company's services.

Brad saw the job in two parts: sign the deal, then train the partner's sales and service teams. He was good at the first part. The second part kept slipping.

His updates sounded the same every time: tough quarter, everyone heads-down, lunch-and-learn penciled in for H2. But the delayed lunch-and-learns weren't the problem. They were the symptom.

On a few partner calls, the pattern was obvious. Brad thought the partners had let the services slip down their list. They had never been on it. To the partner, the services weren't something to sell. They were there in case a client asked. The agreement covered an edge-case request, not a read on real demand.

Those aren't channel partnerships. They're hedges.

It's never fun to tell someone — or their CEO — that what they thought were partnerships were really contracts built on untested hope. So we changed the playbook. Most of the existing partners — gone. A handful we kept and rebuilt. And no new partner counts as closed-won until four things are true:

1. Proof. At least one mutual, replicable, referenceable client. Mutual: the client runs on both companies' services, and both support it. Replicable: the financial and operational model scales beyond a one-off. Referenceable: all three — the two companies and the client — would turn it into a case study. Before a contract.

2. Operational terms. Sales, integration, product marketing, operations, and support assigned on both sides — to people, not to "the partnership."

3. Clearing price. The revenue share has to net out to a customer acquisition cost the company can carry — and still leave the partner's sales team enough to care. Too far either way, and nobody sells.

4. Honest economics. A major market-maker brings reach — and demands a bigger share, guarantees, marketing dollars. A smaller partner brings less and costs less. A partner with great reach but upside-down economics is not a partner, but a vendor. And one that seems affordable but too small to matter is just pipeline slop.

Channel partnerships can produce profitable scale. I've seen it — at my startup, at Amazon, and at Microsoft. But they can also become a game of dress-up: hopes masquerading as deals. A signed contract does not create a channel. It only records one. Sign before all four are true, and a contract is all you'll have. And you'll starve, waiting on a lunch-and-learn that never comes.