At What Stage Should You Hire A Sales Leader For Your Startup?

October 9, 2020

As a founding member of a tech startup you have more than likely been handling sales among countless other duties and quite frankly getting burned out. Is it time for you to get out of the sales role and focus on your business instead of run the internal hamster wheel?  Making the right moves in your business to ultimately scale your revenue is critical to grow.  Take a look at our recommendations we encourage our clients to consider when deciding the best time to expand to a formal sales team: 

How Are You Developing Business Today?

Evaluate what is working well to acquire new clients. Are you able to acquire new clients easily as a founder or is the sales cycle complex? Imagine freeing your schedule to focus on the business instead of in every deal!

Often, our clients have built their businesses off of referrals which got them through the initial experimentation phase.  Now it is time to assess where you may need help so you can grow with the right resources. If you’re transitioning from surviving solely on referrals to creating inbound marketing activity and hiring a sales team, it is a great time to put together a marketing plan which we discuss here.  

Net new business acquisition requires a successful marketing program before hiring a sales team as it is extremely difficult to sell without an established brand identity. Worst thing would be to hire a sales team too early only to experience rep churn could cost you over $100k per rep in sunk costs.

Are You Ready to Support & Enable A Sales Team?

Many entrepreneurial sales environments rely on cold calling, networking and driving a bunch of “activity” then experience lackluster sales results.  Activity does drive results however your business needs to encourage repeatable activity to drive the right results that will impact your bottom line and connect with your target audiences in a meaningful way. Before we dive into more detail let me outline a scenario:

Hiring The Rockstar & Expecting Performance With No Microphone

A. Johnny is a new rep and doesn’t have any training on your products or services and you hired him because he is “an award winning IT sales professional”.  You expect that Johnny will open his rolodex of contacts and tell them how great your company is and in return hundreds of thousands of dollars if not millions of dollars in revenue will be magically booked right? 

Believe it or not, this idea still exists even though we know as sales leaders this is far from reality. Your sales team needs to be enabled correctly to perform well.  When considering the best time to start a sales program, think about your organization’s ability to support a sales team.

You Might Be Ready To Hire Sales If:

1. You Have A Clear Value Proposition

What problems are you solving? Your sales reps will need to act as brand ambassadors initially if you’re just starting out in a marketplace to gain traction of desired activities.  Sales leadership must effectively train and provide opportunities for new sales reps to understand and become proficient with your offerings so that they can act as trusted advisors to your customers vs. reciting a stale sales pitch.  

In this world of Digital Transformation 2.0 customers have usually identified their problem, understand your competitors before they reach out to you and have many similar vendors to choose from in any given area.  You must be ready for a more informed consumer and ready to solve for your customer’s perceptions of themselves. 

2. Current Sales Results Point Back to Repeatable Activity

If you’re not sure how you arrived at your current revenue and want to hire a sales rep to test out new business development activity, it is important to set expectations and give them the first year ramp time to test the market for you. Getting in front of your target buyers will vary between businesses so understanding which activities drive the best results will come from a bit of trial and error. Successes should become evident quickly for your business to rinse and repeat. (Activities may include: Networking, calls, webinars, focused thought leader group participation, dinner events, etc.) 

3. You’re Ready To Focus On The Business Instead of In The Business

Did you develop your business from the ground up, perhaps engineering the original product that started your dream business? Trusting your organization to be represented by a new individual can be a scary concept for founding members. Rightfully so! You put your blood, sweat and tears into it during the early days to get it off the ground. If you’re ready to share your solution and industry knowledge and truly mentor someone to represent your business in the best light then you may just be ready to focus on leading the business vs. bringing every deal across the finish line.

4. You’re Ready To Create A Consistent Sales Process To Drive A Repeatable Revenue Forecast

A great sales program starts with process and tool that will enable you and your sales team to effectively set goals and communicate revenue expectations to the whole organization. What tools do you have in place today to forecast business, find new contact information, track marketing and sales activity performance?

Identifying a sales process within a CRM tool is incredibly helpful to create consistent sales process that grow repeatable revenue, encourage consistent client experience thus driving high client retention and complete business health visibility. We happen to be fans of tools like Hubspot for innovative tech businesses due to their integration capabilities, automation features for both reps and marketers.

If you’ve answered READY to these questions,

Hire an experienced and collaborative sales leader to coach and enable your sales team toward higher revenue achievement.  As Digital Transformation 2.0 continues it will be equally important for your chosen sales leader to be adept at working with marketing and help bridge any gaps as the goal is to enable buyers to do business with your organization not operate in linear silos which many sales organizations still do today, causing conflict.  

Not ready to hire a sales leader full time or long term? Don’t worry we’re designed to help you in that very case.  Learn more about our Fractional Sales Leadership packages at Relativity Consulting here

Contact us for a free consultation to discuss your organization’s needs at [email protected].

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