As a founder, hiring your first salesperson can be daunting and the criteria for doing so can be ambiguous as you are embarking on unfamiliar territory. The following should help frame your considerations and organize your efforts in the process of taking your business to the next level.
The following discussion is most relevant for those founders who are in the early stage – proven product fit or fully launched. Depending on your company’s growth stage, you will need a different level of sales talent.
1. You can document the sales process
You understand your customer base and intended audience and have intimate familiarity with all buyer personas. For instance, you should understand how end users, line managers, and financial decision makers will think of your solution. You know what triggers compel them to make buying decisions and understand how they think of your solution within the competitive landscape. This familiarity with the audience also means that you have completed early experiments around pricing, messaging and sales processes like demo and follow up procedures.
This understanding should be documented by drafting an ideal customer profile and a list of buyer personas. Each of these sales process documents should be comprehensive and thorough such that a new hire with very little familiarity with your process would understand exactly who the intended audience is and how your solution addresses their concerns. High customer orientation is a key characteristic of your next hire, if you can’t communicate this to your early sales team members, you are setting them up for failure. Fitting square pegs in round holes or selling ice to eskimos is distracting and unproductive as you attempt to achieve scale. To ensure that your market perspective and customer focus is embedded in the DNA of your team, create clear documents that your first sales hire can reference to get started with selling your solution.
You should also be able to document the lead handling process. Since you are considering hiring a salesperson, you likely have developed a lead mechanism that is generating a predictable number of leads in a given period of time. Show your growing team how you close deals, explain the deal cycle and the common steps associated with turning leads into customers. This document should answer questions like:
- How long is the deal cycle?
- What are the roles of the decision makers?
- Is there a free trial?
2. You have exhausted automation
We are in the age of automation, at this point you have employed tools to engage customers on the top of your funnel. You probably have sales automation tools in place that will push content to information seekers until they raise their hand to talk to you. In other words, your pipeline exist and it is growing.
You will need to hire a first salesperson if these conversations are too numerous or too complex for you to handle alone. If you are selling a complex solution that touches several lines of business or even the entire enterprise your sales process likely includes multiple demos, free trials, and technical conversations. It is very difficult for founders to manage all of these interactions with more than a few prospects at a time. If you see that these activities are taking you away from engineering or developing the feature roadmap for your product, you need to hire someone else to focus on these activities.
Another indication that you should bring in a first salesperson is when you see that deals are not being optimized. As you get started, watching new customers sign up with their credit card is exciting. When you see these self-service sign ups you can be sure that your service or product is answering a real market need. Can this be amplified? Do you see you low tier sign ups from large companies? In order to scale and meet your goals, ASP needs to be optimized as early as possible. Even at this early stage, you should work toward delivering maximum value and not leave money on the table. The best way to do this is hire an experienced salesperson who can communicate value in a manner that allows you to reach maximum revenue for each customer.
3. You need a lab manager
Startups are exercises in iteration, you are constantly looking for ways to get the most out of each customer conversation, every piece of marketing content, and every new lead. As you grow your company, these sales experiments are taking place on business and technical teams simultaneously. If you need someone to own the improvement of the customer experience, you need to bring in a salesperson to help fine tune this aspect of your practice. If you have some wins under your belt, but have trouble answering questions about why some customers go dark after the demo or how to increase deal size, you can bring in someone to help with experiments that will optimize these pipeline dynamics.
If you do not have someone who is responsible for continuously making the customer journey better, you are likely missing important data from your audience. A salesperson is primarily responsible for closing net new revenue, but on the way to do doing this they are an invaluable resource of qualitative and quantitative data. With proper CRM usage, you will be able to drill down on the cost and value of activities like introduction/discovery calls and demos. Understanding these metrics will tighten up your ability to forecast, set realistic goals, and drive enterprise value.
Revenue growth will be the ultimate measure of your company’s success. Under-investing in sales is a common mistake for startups. It is never too early to develop a thoughtful approach toward hiring a strong business team that will allow your product to permeate the mindshare of your audience. The intentionality and structure you undoubtedly used to execute the product vision should be matched in the area of go-to-market activities. Companies that have a strong ability to educate the market and connect with customer needs will outperform their competition. Your early sales talent will be instrumental in shaping how your team delivers in this regard.