As a sales leader, I’ve been involved in many company transitions from founder-led sales to dedicated sales teams. Each time, it feels like a moment of reckoning, where the truth becomes clear — things are about to change, and change isn’t always easy.
In the first part of the new ATM Unplugged series, I’m going to focus on transitioning from founder-led sales to sales-led sales in a startup and discuss strategies for the founder to effectively scale without draining themselves.
Channeling Founder’s Passion into Scalable Processes
In the early stages of startups, founders must take on the selling role — they must actively uncover the connection between perceived and real customer pain points and how their product addresses those issues. They often excel at securing early customers through networking, leveraging their passion and enthusiasm. Trust me, no one can convey the product’s value with the same dedication and understanding as a founder.
Finally, they realize that change is needed.
They may not have formal sales training, and as the company grows, it becomes essential to implement processes to avoid relying solely on heroic efforts. The goal is to create a process that others can execute, enabling the business to grow beyond the founder’s individual involvement in the sales cycle.
Still, they often want to replicate their success by cloning themselves ten times over, a mistake many first-time sales leaders make as well — so they jump into hiring, training new people on the product, and expecting deals to start flowing quickly and easily.
The reality is that replicating the founder’s passion and success isn’t possible, and they’re setting up their teams for failure.
Start with the Sales Playbook
Many times hiring takes precedence over processes. And as much as I can relate, you need to have the foundation first. If there isn’t a defined sales process, it means no repeatability and scalability. Key factors such as pricing, contract structure, promises made to early customers, and product features may have created debts that need to be addressed.
It is often-times beneficial to start by bringing in someone in a fractional role who can assist in developing the sales process. They can help founders build out and refine what the great sales process looks like before making a full-time hiring commitment.
Setting up the Sales Playbook
You start with determining the primary motion of your sales strategy. Are you predominantly focusing on inbound or outbound? Do you need BDRs or will you just have full-cycle AEs? These approaches require different tactics and considerations. Assuming you primarily focus on outbound, hiring a fractional leader means leveraging their experience to set up your sales operations for success.
So to start:
- Identify your Total Addressable Market (TAM), Serviceable Addressable Market (SAM), and Serviceable Obtainable Market (SOM). If you don’t know how big the opportunity in front of you really is, you don’t know what goals to set.
- Define your Ideal Customer Profile (ICP) regarding company profile and buyer personas. Knowing who you’re selling to from the beginning saves time and ensures you’re targeting the right audience.
- Build the sales playbook that involves determining the sales flow and messaging. Are you relying heavily on email, phone calls, LinkedIn, or a combination? What you say and how you say it is just as important as where you say it. Experiment often as it will likely take many tries to get this right.
- Craft a compelling value proposition tailored to your ICP
- Define the sales process — from discovery to demo, objections and negotiations, pricing to go-live…a smooth process is vital to your future success.
- Establish a smooth motion from prospect to customer, eventually to expansion and ultimately renewal.
Once these processes are in place, you can focus on refining and optimizing them for continuous improvement.
Hiring Your First Sales Rep
When starting the hiring process, it’s essential to consider these:
- Is the product simple or complex? This evaluation helps determine what kind of seller you should be looking for.
- The compatibility of personalities between you and the salesperson. It’s often beneficial to look for someone who complements your weaknesses.
You may not necessarily require a salesperson with extensive technical expertise if you have a solid technical background. Instead, you might need someone who excels in pure salesmanship. Industry experience is another crucial aspect to consider. It may be necessary for the salesperson to have prior experience selling to your Ideal Customer Profile (ICP).
Considering these factors, you can find a salesperson who aligns with your product, compliments your skill set, and possesses relevant industry experience to sell effectively to your target customers.
You’ve Hired the First Sales Rep — What Now?
Set Clear Expectations
When hiring the first sales representative, founders must provide straightforward instructions. This clarity will help the sales team stay motivated and focused. It is important to set realistic success metrics that are defined not only by the number of closed deals but also include factors such as:
- deal progression
- shortening the deal cycle
- average selling price
- average contract term.
In the early days, what you learn is as important as what you sell.
Build a Strong Onboarding Program
Match new salespeople with experienced mentors who can help them with guidance and support. These mentors can come from different departments within the organization, such as product and engineering, who have been involved in the early stages of product development. They share their knowledge and help the new salespeople understand and embrace the founder’s passion and vision.
Cultivate an environment where the sales team can collaborate with the founder and other departments. This fosters a connection to the company’s core values and vision. Weekly stand ups can be a great way to start.
Do you want to be micromanaging and getting involved in every aspect, including sales calls and pricing discussions? This approach hinders the growth and autonomy of the person you hired. You should instead build trust with the new hire and allow them to flourish in their role. You empower them to perform at their best by trusting their abilities and expertise. It’s essential for building a successful working relationship.
Considering someone with a diverse skill set can be highly advantageous. It may take time to be intuitive, but having individuals with different strengths and perspectives can significantly benefit your company’s overall performance and success.
Foster Career Growth
Make sure to know how you envision their career growth. For example, are they individual contributors? Or managers? Understanding their career path is vital, as any skilled salesperson will want to know what opportunities for professional development exist. Clarifying this helps attract top talent and demonstrates your commitment to their growth. It sends a message that you value their contributions and have a plan for their professional advancement.
First 30, 60, and 90 Days of the New Sales Hire: Key Metrics and Evaluation
The key indicators in the first 30 days are response rates and meeting bookings.
In addition, you want to assess if the initial outbound messaging resonates with the target audience and if it’s compelling enough for them to invest their time. Finally, it’s crucial to iterate quickly during this period and seek feedback from prospects to refine the messaging.
With the 60-day timeframe, the focus shifts to conversion rates.
First, it’s essential to analyze how many initial discovery calls progress to the point where prospects express interest in seeing a product demo. This indicates that the pain points have been effectively identified, and a genuine desire exists to explore the solution further. Additionally, tracking meeting-to-dial/email ratios helps understand the effectiveness of outreach efforts.
As you approach the 90-day mark, the attention turns to the level of engagement and the willingness of prospects to involve other senior stakeholders.
This showcases the value and relevance of the product or solution. It’s also essential to monitor the number of pricing discussions and commercial negotiations taking place, as well as the number of closed deals.
By focusing on these metrics at different stages, you can gain insights into the effectiveness of your sales efforts and make informed adjustments to drive success.
It’s an emotional ride.
It’s common for founders to become emotionally invested in their product and feel frustrated when it’s not selling as expected. While sales issues can be a valid concern, it’s essential to recognize that sometimes the problem lies with the product itself. Therefore, there may be better solutions than simply firing the salesperson.
Founders need to learn to step away from sales and trust in their fractional leader’s or sales team’s expertise if they truly want to grow their business.
Sales, like product development and engineering, is a science with right and wrong approaches.
Founders who have not sold before should avoid getting overly emotional and micromanaging the sales team, just as a non-technical founder wouldn’t interfere with the product team.
Building trust and understanding the sales process is crucial. Relying on sales heroics, such as offering special deals or personally closing every sale, hinders establishing a scalable business. By implementing the strategies and structures discussed earlier, founders can hopefully distance themselves from emotional decision-making and have confidence in a well-defined plan. This allows for a more objective approach and the ability to scale the business effectively.