What Is an ISV and How Can It Help Your Business?

As a business owner competing with the countless new and developing marketing technology companies, you may wonder about other processes and relationships such as what an ISV is and its potential to help your business. Being an ISV, ISV partner, or a platform with ISVs can help you remain highly competitive, cut costs, and increase your revenue. In this article, we’ll discuss what an ISV is, different ISV types and ISV relationships, and how the different ISVs can aid in higher success for your business.

what is an independent software vendor

What Is an Independent Software Vendor (ISV)?

With more marketing technology companies than ever to compete with, there are different technologies and relationships such as ISVs that help your business stand out and be more successful than simple inbound marketing techniques alone. Operating systems, computer hardware, and cloud platforms have developed marketplaces in which marketing technology companies can offer their software and tech solutions to these platforms’ specific customers as ISVs. ISVs have drastically changed the competitive landscape, increasing their success with higher visibility and revenue.

In general terms, an ISV is an individual or organization that creates, markets, and sells its software solutions on another’s platform. These software solutions are typically compatible with one or more operating systems. These can include iOS, computer hardware providers such as Macintosh, or cloud platforms such as Amazon Web Services. The software solutions of these independent software vendors also provide more functionality than what is typically available with a system’s standard version. Some of the top ISV solutions that improve a business’s functionality include reporting, e-commerce, tax compliance, and EDI (electronic data interchange).

Some common ISV marketplaces include the Amazon Web Services (AWS) marketplace and Google Cloud Platform (GCP). These providers are consistently updating and increasing their range of programs, resources, and service enhancements. They also regularly change their fee structures for an ideal balance between incentive, investment, and cost. ISVs also like to sell on well-known platforms such as these to increase their outreach while also diversifying their customer base. Increasing exposure and outreach by being present on more known platforms is a current top content marketing strategy often used for social media platforms but highly applicable for ISV success.

ISV Partner

An ISV partner is essentially the same as what an ISV is in that both resell their software solutions on a system, hardware, or cloud platform’s marketplace. External ISV partners can also provide additional help with unique roles within the market. ISVs build the product for sale but often find a challenge in continuing the product to scale. 

However, the major difference between ISVs and ISV partners is that the majority of ISV certification processes are generally more exclusive than ISV partnership programs. ISV-certified refers to the certification of verified competency, knowledge, and skills an ISV can receive. Specializations of ISV certifications include infrastructure, virtualization, middleware, and solutions. Typical courses for ISV certification include business productivity, core infrastructure, cloud performance, and data platform performance. 

independent software vendor

ISV Certification

Distinct certification defines what type an ISV is, a regular ISV or an ISV partner. Microsoft’s competency certification required to sell through them, for example, has unique requirements based on customer needs. It is also based on whether or not your solution or application can pass one of Microsoft’s seven application tests. Finally, it requires at least three references from customers who have used or tested your solution or application. There are also membership fees involved with some other platforms. Platform providers want to test the ISVs that want to sell through their platforms. But, they will only allow or certify ISVs that have the most relevant solutions with the highest quality and performance. To become an ISV partner, you often just need to sign up to become a part of a platform’s partner program. 

Types of ISV Partnerships

There are various types of ISV partnerships to consider for your increased business growth. These include OEM partnerships, payment partnerships, reseller partnerships, and software/SaaS investor partnerships. ISV partnerships help continue to drive business growth. Microsoft, for example, now has a higher focus on partner collaboration, noting that 95% of its commercial revenue comes through partners.

OEM Partnership

In an ISV-OEM (original equipment manufacturer) partnership, OEMs make software integrable into an ISV’s solution, such as Google Maps into Uber’s software. Another ISV-OEM partnership integrates third-party analytics functionality into a software product. Both types provide the software company’s end-user with increased value.

Payment Partnership

A payment partnership integrates a payment solution into an ISV’s product. This partnership allows the ISV to provide greater value to their customers and improve user experiences. For example, CardConnect offers an ISV partner program including everything for an ISV to build, scale, and manage fully integrated merchant payment acceptance.

isv partner

Reseller Partnership

In a reseller partnership, software reseller programs distribute an ISV’s product to customers an ISV may have difficulty reaching. This is important because it increases the ISV’s business development. In the VAR (value-added reseller) model, a customer adds an ISV’s software to their service or product. The VAR improves the ISV product’s value based on the needs of the end-user and customer, gaining the ISV more customers.

Investor Partnership

An example of an investor partnership is a SaaS business investing in an ISV’s software. These agreements give an ISV the funding to continue developing and improving their software company for higher growth. Having an investor can provide valuable and often necessary capital for a new business or one with a small customer base to continue.

Top ISVs

Some of the top ISVs of 2022 include Apache Software Foundation, Salesforce, Intuit, Autodesk, and BowStreet Software. Apache has a reported 63% share of the market. Salesforce has free developer tools and a large portfolio of customized apps. Intuit uses direct consumer mail and telesales for high sales. BowStreet created Java development tools simplifying code-generation tasks and application ownership costs. 

Beneficial ISV Partnership Examples

ISVs often use a B2B marketing strategy by their definition, marketing their products and services to another business to enjoy mutual benefits. Some company-specific examples of mutually-beneficial ISV partnerships include Amazon Alexa and Spotify, Slack and Giphy, and DocuSign and Salesforce. Amazon and Spotify both see increased value through a user’s ability to use a voice command to listen to Spotify on their Amazon Alexa. The partnership taps into a highly popular experience with a global audience, increasing Spotify usage.

Employees already frequently use Giphy within Slack and their partnership now increases gif use within Slack. DocuSign integrating with Salesforce enables various business sizes and industries to go paperless. They can also sync their CRM data with their document management processes to increase usage of both DocuSign and Salesforce.

what is an isv

ISV Fees

ISV solution costs can vary greatly depending on factors such as the type of solution and the amount of functionality it has. Solution types with budgeting functionality, for example, are cheaper than an EDI solution. The business problem you desire to solve is arguably the largest factor in deciding the cost of your ISV. All solutions differ, with some being more expensive but with more extensive functionality for the cost. Other solutions offer more basic functionality and are more for small businesses with a smaller initial revenue.

How Can an ISV Help Your Business?

ISVs can help your business in many different applications. Your business can develop software to solve a specific problem but is less likely able to address the problems and needs of all customers. An ISV can better address your customers’ unique needs with higher focus and quality toward individual needs. This increasies service quality and customer relationships through the partnership. Meanwhile, the ISV gains outreach, revenue, and support. Both will become more valuable and sought after for customer solutions, additional service, and software options.

The platform can become a more comprehensive, well-rounded solution by integrating with the ISV’s software. Tech partnerships such as with an ISV can also drastically change your business’s growth by enabling both parties access to the other’s market without heavy investment and increasing each other’s conversion through connection, customers looking for one and exposed to the other and seeing a higher range of options to choose from. At the root of what an ISV is, you can find an opportunity to increase your business’s success.

FAQ:

  • What is an ISV?
  • How does an ISV work?
  • Who are the top ISVs?
  • What is an ISV marketplace?
  • How do you become ISV certified?

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