From Hype to Revenue: How Resellers Separate Promising SaaS from Vaporware
- LMSPortals
- 34 minutes ago
- 5 min read
The SaaS market is flooded with startups making bold claims. Every week, new software promises to "revolutionize workflows" or "unlock productivity at scale." But for resellers—those who bet their own revenue on selling someone else’s software—the stakes are real. Selling vaporware isn’t just embarrassing. It’s bad business.
So, how do smart resellers cut through the noise, evaluate SaaS products rigorously, and pick winners that deliver value and generate actual revenue? Let’s break it down.
Understanding the Landscape: Why Vaporware Exists
The Low Barrier to Entry in SaaS
The rise of cloud infrastructure and low-code tools has made it easier than ever to launch a SaaS product. Founders can spin up MVPs and slap on enterprise-grade messaging in a weekend. Marketing gets ahead of engineering. Demos are polished, but the backend is duct tape.
The Race for Funding
In early-stage startups, hype isn’t just a strategy—it’s currency. Founders pitch big visions to VCs, often before the product works. That hype spills into sales decks, partner programs, and reseller pitches. If resellers aren’t careful, they end up trying to sell software that barely functions.
What Resellers Want: The Criteria for a Sellable SaaS
Smart resellers have a checklist. They’re not wowed by sizzle—they want steak. Here’s what they look for before committing to a SaaS partnership.
1. Product Readiness
Functionality First: Does the core product work reliably? Is it out of beta?
Support Load: Will resellers be overwhelmed with support tickets because the product is buggy?
Integrations: Are APIs stable? Does it play well with key platforms (Salesforce, Slack, etc.)?
2. Market Fit
Customer Use Cases: Is there a clear, specific pain point the product solves?
Proof of Demand: Are there existing customers with case studies, testimonials, or logos?
Churn Rate: High churn means the product overpromises and underdelivers.
3. Sales Enablement
Clear Pricing: Is the pricing simple, transparent, and competitive?
Demo Resources: Are there working demo environments and effective sales decks?
Channel Support: Is there a dedicated point of contact for partners? Do they care if resellers succeed?
4. Incentive Alignment
Reseller Margins: Are commissions and renewal structures meaningful?
Conflict Avoidance: Will the vendor poach leads or undercut partners directly?
Deal Registration: Is there a system to protect reseller opportunities?
The Red Flags of Vaporware
Spotting a bad bet early can save time, money, and credibility. These warning signs suggest the product might be all hype and no substance.
Over-Polished Marketing, Under-Developed Product
If the website looks Fortune 500-ready but the app crashes on login, that’s a red flag. Vaporware companies often overinvest in design and pitch decks to mask weak infrastructure.
Reluctance to Provide Trials or Demos
If a vendor dodges requests for sandbox environments, or the demo is always “pre-recorded,” that’s suspicious. It usually means the product can’t handle real-world testing.
Vague Roadmaps and Promises
Good vendors give clear timelines. Vaporware outfits use phrases like “coming soon” or “Q3-ish” without specifics. If everything is “on the roadmap,” nothing is real.
High Pressure, Low Transparency
Beware the startup pushing resellers to “get in early” with unclear terms. Real partners are transparent about their product maturity and are willing to share detailed info.
Due Diligence: How Resellers Vet SaaS Products
Smart resellers apply a mini diligence process, not unlike an investor. Here's how they do it.
1. Hands-On Testing
Nothing replaces time spent inside the product. Resellers set up use cases, test integrations, and stress test features. If it can’t handle basic workflows, it's out.
2. Customer References
Talking to existing customers is essential. Resellers ask hard questions: Is support responsive? Has the product improved? Would they buy again?
3. Roadmap Access
Resellers want to see a detailed, realistic roadmap—not just slideware. Ideally, it’s shared in writing with dates, priorities, and transparency about what’s actually in development.
4. Founders and Team Access
Is the founding team technical and engaged? Can resellers talk to product leads? This access helps assess whether the company is serious about building, or just pitching.
5. Revenue Reality Check
What are monthly recurring revenue (MRR) numbers? What's the growth rate? Are there real users paying real money? Smoke and mirrors are easy—sustainable revenue is not.
The Strategic Advantage of Being Picky
While it may be tempting to say yes to every flashy new SaaS vendor, top-performing resellers know that discipline pays off.
Protecting Reputation
Resellers are often the first line of trust between a vendor and a new customer. Selling a half-baked product ruins credibility fast. Good resellers play the long game.
Streamlining Support
Every broken feature means more support calls. Every gap in the product means lost upsell potential. By vetting upfront, resellers keep their support burden manageable and margins high.
Growing Through Renewal Revenue
The best SaaS resellers build portfolios that drive recurring revenue. That only works if customers renew. And customers only renew if the product actually works and creates value.
Case Study: How One Reseller Built a $10M Portfolio by Saying "No"
One prominent SaaS reseller, let’s call them GrowPath Partners, started in 2018 with a simple rule: never sell anything they wouldn’t personally use.
They evaluated over 120 SaaS vendors in the first two years but only signed with eight. Every product had to meet strict criteria: working integrations, proven ROI, and clear sales support.
Within three years, GrowPath was generating over $10 million in ARR (annual recurring revenue) through partner sales. Their churn was below 5%. They credit their success not to what they sold—but what they refused to sell.
What SaaS Vendors Can Learn from This
If you're a SaaS company trying to win reseller support, the bar is high—and for good reason. Here’s how to attract quality channel partners.
Build First, Pitch Later
Nothing wins resellers like a rock-solid product. Before recruiting partners, invest in the basics: uptime, documentation, onboarding flows.
Create Real Enablement Material
Don’t just hand over a PDF. Give resellers working demos, use-case templates, pricing calculators, and objection-handling guides.
Be Transparent About What’s Not Ready
Honesty builds trust. If your integrations are still in development, say so. Let resellers decide if they can work around it—but don’t fake readiness.
Invest in Channel Success
Design a partner program with real benefits: tiered rewards, deal protection, and responsive support. Treat your resellers like strategic allies, not disposable lead-gen tools.
Summary: Hype Fades, Results Matter
In the crowded, fast-moving world of SaaS, resellers play a vital role. They are the bridge between innovative products and skeptical buyers. But with that role comes responsibility—and risk.
Great resellers know the difference between buzz and value. They test ruthlessly, choose carefully, and invest only in software that delivers results. That’s how they turn hype into revenue—and avoid becoming another cautionary tale in the land of vaporware.
About LMS Portals
At LMS Portals, we provide our clients and partners with a mobile-responsive, SaaS-based, multi-tenant learning management system that allows you to launch a dedicated training environment (a portal) for each of your unique audiences.
The system includes built-in, SCORM-compliant rapid course development software that provides a drag and drop engine to enable most anyone to build engaging courses quickly and easily.
We also offer a complete library of ready-made courses, covering most every aspect of corporate training and employee development.
If you choose to, you can create Learning Paths to deliver courses in a logical progression and add structure to your training program. The system also supports Virtual Instructor-Led Training (VILT) and provides tools for social learning.
Together, these features make LMS Portals the ideal SaaS-based eLearning platform for our clients and our Reseller partners.
Contact us today to get started or visit our Partner Program pages
Comments