Once you're at the point where your customers use your service regularly, have good retention rates and early signs of revenue growth, it may be time to consider hiring sales representatives.
Here are the four stages of sales hiring for start ups.
Stage 1: Founder-Driven Sales (founders only)
The first person to sell your product should be you, the founder. Do customer development yourself, and be as close to your prospects as you can. This will help you immensely later on when it is time to scale up sales hiring for the business.
Begin by tapping into your network of:
- Friends and acquaintances
- Past employers
At this point, focus on early stage sales exploration:
- Gain insights into your market
- understand and listen to your customers better
- What objections do they have?
- How do they describe their problems?
- What are their pain points?
- Figure out which metrics truly matter for your sales outreach and business
- Test different strategies, methods, and tactics to make sales and drive business
- Get started with cold email and writing a sales phone script
This phase is about figuring out what will work in the real world. The experience you gain will help you later evaluate salespeople when it's time to dive head first into true sales hiring.
Stage 2: Founder-led Sales Team (2-3 sales reps)
Once you have some level of success, the question you'll ask yourself is: "How do I grow this? How can I take this to the next level?"
Right now, your focus should be on bringing others on board and have them replicate the results you achieved as the sole-seller.
Don't hire expensive sales veterans yet! You want them to be young and hungry in this phase. Hire two or three sales people at the same time if you can. This will add competition, firepower and the ability to compare and track efforts by each employee.
At this stage in your sales hiring, you still need to be deeply involved. You're managing, leading and motivating this team. You're still pitching, doing outbound and inbound, working with your sales reps and listening to feedback.
You can't outsource this. There are too many critical decisions to be made; you need all of these one-on-one experiences with customers, different sales channels, and lead generation methods. It's not enough to simply monitor numbers.
Don't worry about setting up commission structures at this point yet. Hire the first 2-3 salespeople and work with them to get the sales process to predictability. Once you're there, you can develop a commission structure with your team to match the size and frequency of each new deal.
Goals you should accomplish before transitions to the next stage of sales hiring include:
- Try and test cold-email templates
- Use an effective sales lead management system
- Be experienced at negotiating deals and know how to handle discount inquiries
- Use drip marketing emails to convert leads better
Stage 3: Junior Sales Leader (3-15 sales reps)
At this point, your selling process has matured: results are a lot more predictable and you're ready to scale your hiring process. You've established an effective sales funnel and are generating consistent growth. It's time to focus on sales execution which requires some leadership from a manager.
What should the sales manager accomplish for your company?
- Fine-tune the touch sales approaches you've developed
- Expand on the things you've learned
- Grow and manage your sales team
- Establish a sales hiring process
- Set up quotas, train and coach your representatives
You want to look for someone who has experience overseeing the growth of a tiny sales team of three people to 10, 20 or 30 people. Candidates should have started out as junior sales reps in a previous company, then grown into a managerial or leadership role there, and have already managed a team that's a bit larger than yours.
Good sales managers will improve existing structures and optimize processes. They usually do not excel at building something from scratch but will propel your business forward if they can build on something already existing.
Stage 4: Senior Sales Leader (25+ sales reps)
Once you're beyond the barrier of around 15 salespeople and you want to go big with your hiring efforts, the next breakthrough will be at 25+ sales reps.
You'll need a senior sales leader, also known as a VP of Sales, who can manage a few managers/directors.
Someone with a proven track-record of scaling things big, who is a VP of Sales at a company that already is where you want to be in three years from now. A VP of Sales will work on sales strategy, scaling and expanding your channels, moving your customer base upstream as well as improving your unit economics. They will:
- Build an organizational structure for the sales team
- Develop sales hiring and training plans
- Reorganize your commission structure
- Groom sales talent to sales management positions
- Open new offices
- Add new channels like field sales to your inside sales team
- Close larger deals
To bring such a person on board, you'll need to throw a lot of money and some equity at them. They will guide your sales team on a journey that can either make or break your startup.
If you focus on the right thing and hire the right people at the same time, you're going to see your startup going from sales exploration to sales execution and ultimately sales scale.
Need help with your sales hiring or talent acquisition process? Check out Staffer.cc