During the initial stages of a startup, the workforce is typically small, and sales representatives are often absent. As the CEO or founder, this means you are responsible for pitching and selling the product to potential clients.
At this crucial juncture, engaging in sales exploration becomes imperative as it allows you to gain a deeper understanding of your customers, test various sales strategies, and gather insights about the market as a whole.
As the company’s CEO, sales might not be your preferred aspect of business operations. You would rather focus on innovation and devising ways to enhance your product.
However, sales serve as the catalyst for growth. And those sales can be integral to the growth marketing initiatives that define long-term strategies while delivering optimal ROIs.
With that, your early sales and the market research you accumulate play a vital role in propelling your startup through the subsequent three phases of sales growth.
The next stage in the growth of your startup is to hire your first two sales representatives. At this early stage, you should be looking at young sales reps who are just starting out, not veteran representatives. You want fresh-faced sales reps for a couple of reasons:
Before diving into hiring, however, you need to make sure your business is ready for this growth stage.
It can be difficult to pinpoint exactly when you should hire your first couple of sales representatives. You need to ensure you have room in the budget for another salary, plus you need to make sure you fully understand your market and sales cycle. Below are a few key milestones you should hit before hiring your first sales representative.
By stage two of startup growth, you should be seeing consistent sales and growth within your company. You have an effective sales strategy and sales funnel as well as 3 to 15 sales representatives working for your company.
At this point, it’s time to start hiring sales leadership positions such as a sales manager or sales director.
When reviewing possible candidates for your sales manager, you want to find someone with experience leading sales and demand gen teams as small as three people to as many as 30. Look for a candidate with a background as a junior sales representative who worked their way up to a leadership role. The sales manager will help ramp up your company’s growth marketing initiatives whlie expand your capabilities.
The main three goals of a sales manager should be to refine the sales process, effectively manage the sales team, and lead the team through various training and coaching. Below are a few main characteristics you should focus on when reviewing potential sales leader candidates.
The next move to stage three of your startup sales hiring is crucial. A senior sales leader will play a major role in your growing company. Not only is this position important, but it’s also expensive.
To lure a VP of sales to your startup, you’re going to have to offer a hefty salary as well as equity in your company and extremely competitive benefits. Of course, the high price point that comes with hiring a VP of sales is worth the return.
Once you reach 25 or more sales representatives, it could be time to start thinking about hiring a senior sales leader. It’s around 25 sales reps that you start needing someone who can manage all of your sales directors/managers. Along with managing the junior sales leadership, the VP of sales is responsible for opening new offices, closing big client deals, and scaling your sales channels, just to name a few. An experienced senior sales leader has the potential to skyrocket your company growth, so make sure you put serious consideration into the candidate you choose for the role.
Building a winning sales team should start with strong sales leadership. At Cowen Partners, we’ve seen an increase in fast-growing companies retaining our agency to find them strong sales leaders to build around. After an analysis of their environment, our clients know what hasn’t worked in the past, what they currently have, and where they want to be.
One mistake companies often make is trying to turn a top-producing individual contributor into a team leader (or vice versa). They want their “Director of Sales” to hunt and close large opportunities while hiring, training, and mentoring the team. Unless you have a simple sales process and a very small team, this is not the right move.
The player-coach concept hasn’t worked in the NBA since Bill Russell and The Celtics in the late-60s, and it’s probably not the best strategy for your modern company. A better move is to first determine where you need your company to be in 12–24 months, then hire either a tactical or strategic leader to get you there.
If multiple years of steady growth are what you’re after, you will need a strategic Director or VP of Sales. You may also need to focus on growth marketing. To do that, a strategic sales leader will design and implement processes that are scalable and repeatable. They will have a track-record of leading prolonged growth, writing a sales playbook, and creating effective hiring, on-boarding, and training programs that are repeatable.
Once you have decided on strategy and a sales leader is hired (either tactical or strategic), individual contributors will be added. If you chose a strategic leader, this is where the benefits of that hire will become evident from a personnel standpoint.
The strategic VP of Sales knows what will work in the long run. The processes they implement are practical, and if given enough time they will increase revenue and decrease costs. These strategies help the current team sell more competently and lead to lower turnover.
Salespeople who are selling efficiently are generally happy. Removing roadblocks and providing opportunities for development will attract high-caliber reps, increase hiring success ratios, and create transparency. Clearly defined metrics of success will keep the team’s top performers motivated and indicate when it’s time to course-correct underachievers.
Top-level sales reps are driven by one or more of the following: money, autonomy, and recognition. They are hungry, competitive, and loyal. If they consider making a strategic career move, they will look for companies where they know they can apply their skills, background, and intangibles to proven processes. The strategic VP or Director sets the stage for talented reps to perform their best.
Once your sales team is process-oriented, exceeding targets, and there’s low turnover, you have a high-performance “winning” culture providing steady growth for years to come — all due to hiring and empowering a strategic sales leader.
Hiring your first sales leader isn’t easy, but it’s a necessary step to creating a more powerful sales team. Below are three important questions you should ask a potential sales leader during the interview process.
Sales leaders tend to lean heavily on past experience when selecting sales methodologies and compensation plans. Asking about the difference between your company and the candidate’s past employers will give you an idea of potential weak points in the leader’s experience as it relates to your business. Make sure you also know your own company’s sales methodology so you can find someone with the right experience, whether you do freemium sales, inside sales, field sales, or another avenue.
You don’t want a candidate who hires the same type of salesperson every time. You need a leader who will choose a sales member based on company needs. As the candidate goes over what kind of salesperson they believe is right for your company, make sure you also ask what kind of salespeople they’ve hired in the past. If they’ve only hired one type of salesperson, it could be a warning sign they’re not a right fit.
Compensation plans are a crucial aspect of any sales team, so make sure the leader you’re hiring understands your business model, sales model, and company expectations. If the leader is to structure the compensation plan, they’ll need to understand how to adjust expectations and benefits based on what your company has to offer.
Ultimately, you want to choose a sales leader who is willing to think outside the box and adjust their sales team model to fit your needs. You don’t want someone who is going to copy everything they did for their last employer because chances are the same structure won’t work. A great sales leader will know how to structure the sales process and strategies to fit your business and meet your goals.
Once your sales leader is in place, you’ll need to work together to perfect the sales hiring process. One reason sales position turnover is 27 percent is because companies don’t take the time to properly construct their hiring process. Below is a 6-step plan you can use to improve your sales hiring process.
A strong idea of the perfect sales candidate will make the hiring process a lot easier. If you know what characteristics, qualities, and experiences you’re looking for, it’ll help you weed through candidates a lot faster. To construct your candidate profile, take a look at your top team sellers. What aspects of their backgrounds, traits, selling styles and motivations do they have in common?
Structure your interview strategy around your candidate profile by creating a list of questions and interview techniques that reveal the various qualities and characteristics of your candidates. For example, roleplaying can be particularly beneficial during sales interviews. During a roleplay scenario, you get the opportunity to see how a candidate thinks on their feet as well as assess many other characteristics.
A hiring pipeline is important for keeping the hiring process moving and timely. Set realistic time frames for accepting applications, contacting candidates, interviewing people, hiring, and onboarding. A solid timeline and hiring pipeline will keep your company organized and efficient during the long hiring process.
The sales executive job description has two main roles. First, it needs to highlight your company and sell the team. Second, it needs to accurately describe the job role and expectations. When constructing the job description, pull from your candidate profile when listing background, qualities, and other main candidate characteristics, however, make sure to break everything up into required, preferred, and bonus categories. The perfect candidate doesn’t exist, so be sure not to set unrealistic expectations in the job description.
Standardizing your interviews is a great way to ensure you select the right person for the job. It’s easy to be swayed by how well you connected with a candidate versus the necessary qualifications if you don’t have a solid interview standardization in place. A few tools that will standardize interviews and help them run more smoothly are listed below:
Selecting a final candidate for the sales role is a major decision and one that everyone on the hiring team should take very seriously. It’s expensive to hire someone new, but it can be even more expensive to fire someone. Have a meeting with everyone involved in the interview process to gauge candidate impressions and get a sense of top hire preferences.
As you go through the process of selecting your new salesperson, you may have several top contenders but only one position available. Make an offer to the salesperson you choose, but let the other top candidates know you were impressed with their interview.
Use the rejection email or phone call as an opportunity to form a connection and stay in touch with the other candidates. A few months down the road when you decide to expand your sales team, even more, you’ll already have a small pool of candidates who are perfect for the job.
Our hands-on sales executive recruiters have experience working with private, public, pre-IPO, and non-profit organizations. Clients are typically $50 million in revenue to Fortune 1000’s or have assets between $500 million to $15 billion. Successful placements span the entire C-Suite – CEO, Chief Operating Officer, Chief Financial Officer, and include vice president, general counsel, and other director-level leadership roles.
Check out our industry-leading retained search resources to see why Cowen Partners is a top sales and marketing executive search firm in New York City, Anchorage, Chicago, Seattle, Atlanta, Dallas, Los Angeles, and beyond: