Square has built a big business around providing support to microsellers who were too small to interest credit card companies, or who found their services too expensive. While this market is still their core, they have moved upmarket as well, with larger sellers, assisted by strategic partnerships with companies like SAP. The new channel program is designed to support partners in this upmarket transition.

Today, San Francisco-based Square is announcing the Square Solutions Partner Program, designed to ramp up and support a channel of valued-added partners who can help the sellers who buy Square products with the increasingly complex integrations that are being encountered as Square moves upmarket, and develops relationships with strategic vendor partners with larger channel partners of their own.

“We are very excited about this,” said Pankaj Bengani, Square’s Global Partnerships Lead. “Four years ago, we started our strategic platform partner program, and that has grown very nicely. This is another way to extend our platform, and further our open ecosystem story.”

Square has been in business for nine years, founded by Jack Dorsey, the CEO of Twitter. Their niche in the market was initially among microbusinesses, with the discovery that a large part of the economy couldn’t take credit cards for payment because they were deemed too small to offer the service. Others found the credit card companies wanted too much money for their services. Square developed a card reader for this market that would plug into an iPhone and start processing credit card payments. The business was a hit. They went public three years ago, and have grown their business significantly, adding a variety of more specialized and higher value-add products to expand their customer base, and serve the needs of somewhat larger sellers, as well as those successful microsellers who, like Square, grew their businesses exponentially.

“We grew up serving microsellers, but many of these microsellers have gotten bigger and grown with us,” Bengani said. “There are many who used to do $100,000 in annual sales who now do one or two million annually. We define large selling as more than $500,000 in credit card volume alone. That segment has doubled over the last three years, from 11 per cent to 22 per cent in Q2. Our products have also gotten richer, as we build  better and more specialized products, including POS only for retailers, or restaurants, or ecommerce. Our platform now allows third parties to integrate with Square and further enrich functionality.”

A partnership with SAP inked last year and Square’s integration with Business One was important in creating more partnerships with system integrators. Square has a small number of such strategic partnerships that have the effect of expanding their channel, but not a lot of them.

“BigCommerce, an upmarket website builder that serves larger sellers, has become a strategic partner, and there are one or two other large platform providers that we are about to announce as partners, but we aren’t signing up dozens of these,” Bengani indicated. “We want to do a few of them well. Our goal is not to sign up 30 of them.”

Square has over 75 channel partners today, who tend to fit into three big buckets: mobile and Web agencies; systems integrators; and resellers.

“We have seen a lot of traction from the agencies that create online and mobile experiences, but demand is coming generally across the board from all three groups,” Bengani said.

Square’s strategy is to build out their partner channel in much the same way that they have built their seller channel.

“It’s a sequenced development strategy,” Bengani said. “When we started, we made sure we understood how a set of small sellers use our products, and we stuck to that for a few years. Now, when we onboard new microsellers, we can onboard a large swath of them. We went from value to volume in sellers once we found that lever and learned how to best scale it up successfully. The same thing applies with channel partners. For now, we want to onboard partners we can work with, who are educated on our platform, who understand that we are introducing a new product on average every six months. We expect to reach a point where we can later scale that up.”

The program provides a much more systematic way to support partners than Square has been using up to now.

“When larger sellers with more complex needs said they needed help integrating us into SAP or BigCommerce, we would beg, borrow or steal our own engineers from other parts of our business to pitch in,” Bengani noted. “But that’s not sustainable, because we take them away from other areas of our business. We also knew that we don’t want to build a consulting team of our own. It makes much more sense to ensure that partners are enabled to do this.”

The Square Solutions Partner Program program is also sending a broad message to the market.

“It lets the world know that we have reach, and can help medium and large sellers as well, through our channel,” Bengani said.

The program provides several levels of benefits.

“We call out a few things,” Bengani said. “Channel partners get access to our people and our products, access to our beta products and our APIs, and access to collateral sales support and implementation support. There is also an economic element to it. We want to incentivize them to promote the right products, so their businesses can grow. We also will make sure they get access to our strategic partners like SAP.”

For now, it’s a single tier program.

“Longer term, we will bring in some badging, but right now, everybody is a Diamond partner for us,” Bengani indicated. “Some partners may decide they don’t want to work with us, while some will get closer to us, and we will look at incentivizing things differently later on.”