Tuesday, June 11, 2013

Dare to build a sales team at a startup??


Dear Startup CEO:
If I were creating a field sales organization for my own company, I'd plan the sales strategy knowing the following:
  1. The stakes are significantly higher that a usual technical hire.. The cost of failure is significant at both ends. To some on your dev team or to your VCs, a sales person's success, could be a litmus test indicator if the company will succeed or not.. 
  2. Hire for sales structure, process and NOT the rolodex: Most reps have good contacts and that's a given. But that's not what will close your sale. Hire your founding sales team to create repetitive sales processes, to shorten sales cycles, create synergies with marketing campaigns, to establish sales models that require minimal involvement from precious dev resources to close.
  3. Plan for special needs: Outbound field sales teams have different needs so treat them as such. Their needs are certainly unique from what I suspect you have seen on your current team of marketeers, inbound, inside sales team members. Their motivations, apprehensions are very different from sales wannabe co-founders who've never carried a bag. They (field sales) are like sharks who can cover ground quickly if you can keep up with them.. but they also get tired and de-motivated as easily. They need a path to quickly and meticulously work through their designated territory. Your first sales hire should ideally have a plan for the processes, the tools and has to have this done before the sharks are hired. They need help with 
    1. Resources (comprehensive sales plays, email templates, elevator pitch, competitive analysis), 
    2. Operational metrics discipline (cold calling, research processes)
    3. Accountability (cadence call frameworks like SCOTSMAN). 
  4. Plan for our success or not: Startup sales is freaking hard.. The rolodex is a starting point but can't get you a close.. The career highs are amazing yet few! The lows are many and they can last long.. they can crush sales morale.. So you have to plan for success and (sadly) for failure too.. For the latter have a plan for 25-50% attrition each year.. to get the team to hit the ground running in under 30-days. 
  5. Avoid a shotgun sales strategy aka a generic sales pitch for all industries. Rather tailor the pitch for select verticals and particular use cases. Preferably ones with beachhead synergies to what solution has worked well so far..  Do so by doing the following. 
    1. Identify repeat sales patterns from your current customer base
    2. A barney B2B partnership sales relationship or one with Friends of Management (FOM) is great for a reference client rolodex but is rarely a repeatable deal model
    3. Create a heat map.. Have an A, B an C-list of companies to target in select industries, regions 
    4. Articulate the $$$ impact of the status quo  
    5. the ROI value of a potential Kinvey solution 
  6. Sell the sales person on your product.. With succinct examples, articulate a clear Compelling Reason to Act (CRA) and Why YOU and why not a competitor? What's the cost of non action? a.k.a Startup value proposition? What is the next best alternative to your story? Would someone loose their jobs for choosing the alternative? Those are the killer use cases. Identifying this stuff is not easy, I get it. You'd have to drill deep and be honest. Try selling the solution to the new sales hire prospect. See if he'd bet his new born on the sale? If he doesn't, then do the drill jointly... Ask for his help to come up with the winning model. But don't hire unless they are truly passionate about making the sale.. If the sales guy is skeptical and is raising objections/questions , that is a good thing. Take his perspective seriously and hear them out.. They are playing devil's advocate.. Sales is a team play. There's no one right perspective.
  7. Have a pragmatic pricing model: It can't be I'll take what I can get. To get the large 7-figure deals, you'd have to license differently like ELAs, ACVs deals. Even with that, it's important to identify the value based pricing model. At what price do you walk from a deal? I've created many (good and bad) such OPEX heavy models before so I can give you guidance on the same. 
  8. Double down on the larger sales strategy: To make the above model sticky with newer customers, you'd need at least a couple customers, and a proven execution model before a sales team can succeed on a repeat sales model. Your inside sales pitch, marketing collateral and campaign planning have to all reflect a plan for such deals. 
  9. Keep the comp plan simple, generous yet aggressive: It's possible to hit a balance here. Nothing motivates sales more than hard $$$ incentives. On the same lines, there's no bigger put-off  than a complex plan with inherent gotchas. 
I can go on and on but I'll stop now.. If you like this and want to now more.. it's best to drop me a line at harpalkochar@gmail.com. 

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