How to Grow Your Startup

Scaling Through Sales

“Revenue solves all problems.”

Eric Schmidt

Wouldn’t you know it, searching “ How to Grow Your Startup “ delivers around 250 million search results. There is a lot out there: advice from founders and investors, stories of unicorns, tools and services that claim to guarantee success, ultimate tips and steps, …

Starting, growing, and succeeding with a startup is complex and has a multitude of aspects. My simple categorization of success factors looks something like this:

• Product: Have a product or service with market fit.
• Team: Be a leader that people want to follow and hire people that are smarter than you.
• Sales: since revenue solves all problems and no product sells itself, be sales-centric and find the right approach to building a successful sales organization.

Picture a B2B tech startup with an engineer as a founder.

The founder and a team of developers have built a product, and the founder has taken it to some potential clients and received a positive response. As the company gets ready for a Series A investment, they need to do some early phase scaling, aka sales, to shore up the funding.

So, what are the right steps to take? What comes first?

One of the standard steps seems to be the hire of a VP of Sales. That person is

(1.) costly,

(2.) immediately carries a target on his back,

(3.) quickly has to become an individual sales contributor,

(4.) as well as a product development contributor to pivot the product toward salability,

(5.) and ultimately becomes the fall guy for the lack of sales success.

This type of VP often stays in place for less than a year and, in hindsight, turns out to be a costly endeavor for a cash-strapped startup.

There are smarter steps to take:

Engage a Fractional Sales Leader: In this phase, you need and want the expertise and leadership of a senior executive without the cost and time it takes to hire. What you want to pay for is the senior expertise (“been there, done that”), not expensive feet pounding the pavement. What you want to pay for is someone who can take all the following steps alongside the founder:

• Clarifying strategic direction: This is the first order of business between the founder and the experienced fractional sales leader, and it ideally involves a lot of customer interaction. Positive responses from potential clients are only a great starting point for shaping the go-to-market strategy.
• Improving operational processes: The earlier a business starts to think about a process-centric tech stack implementation, the better. Sales is a process-based numbers game!
• Developing personas and messaging: Cespedes and Thompson describe what happens to companies without clarity in deal selection criteria: “ Either directly in meetings or implicitly in their compensation plans, they basically tell their sales forces to “Go forth and multiply!” And that is exactly what happens. As a consequence, salespeople tend to sell to anyone they can, often at discounted prices to make a volume quota target. … This is ineffective deal management, and it eventually leads to loss of positioning with customers, and, over time, the nurturing of commodity competencies. In other words, the sales force gets better and better at striking deals that more customers value less and less.”
• Recruiting & developing SLRs: For most businesses, a key step is the build-out of a strong sales lead development structure: lead-focused marketing, a process to nurture engagements, a great team of SLRs to pick up a lead, qualify and pass it to sales.
• Recruiting & developing Inside and Field Sales: Most sales leaders will tell you that this step is the hardest. Finding just the right people for a business with still a lot of ambiguity, striking the right balance between structure and creativity, transferring the go-to-market strategy and the messaging so that it can be repeated over and over again. As Wes Saade puts it “… understanding, aligning, and keeping a group of people focused and passionate is simply difficult. You have to be a psychologist, a counselor, an encourager, an inspirer, a parent, a teacher, you have to be a fair judge — wise as Solomon, a hard worker, willing to sacrifice, able to bite your tongue and bend your pride. You have to have courage, empathy, vision, character, patience, and forgiveness.”

Recruiting a permanent Sales Leader: Now, with all of the above steps taken under the leadership of a fractional sales executive, it is time to bring in the full-time VP of Sales!

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Wes Saade — The Most Difficult Aspect of Leadership: People

Frank Cespedes & Steve Thompson — Don’t Turn Your Sales Team Loose Without a Strategy

Photo by Anne Gosewehr

Originally published at https://www.vendux.org on April 10, 2022.