Account Executive or a Business Development Representative — what should be my first sales hire?
Why hiring a BDR early on is crucial for every B2B organization
As an early-stage B2B SaaS founder, you are on top of your game, selling to small-to-medium-sized businesses and enterprises alike. You love sales and have been mastering it. Things are picking up — you closed your first paying customers and the business generates around 10k of monthly recurring revenue (MRR), the product approaches early product market fit, the marketing initiatives generate results, you have a full pipeline and your days become to be full of sales calls.
This is a very good problem to have… right, however, now you need to find a balance between growing the revenue and actually doing all of the other initiatives to run the business — customer development, hiring, operations, fundraising, etc…
You haven’t hired an Account Executive yet, so it’s time to consider scaling your team and figure out what kind of position to hire next.
What I’ve seen (and experienced) to work very well for early-stage B2B companies is actually to go for a Business Development Representative as an intermediate step, instead of jumping the gun and hiring a full-time/proper Sales Executive.
What is the role of the BDR?
To understand if that might be a good option for you, it will be nice to understand what’s the role of the Sales Development Representative in the overall sales organization.
In essence, the BDR is the first step of your sales funnel — that’s the position that qualifies all of the leads and turns Marketing Qualified leads (MQLs) into Sales Qualified leads (SQLs).
Most of the time the qualification process (qualifying a lead) includes understanding more about the intent of the prospects, his/her pain points, the timeline of the decision, and who are the final decision-makers.
I am a huge believer in the personal touch with your prospects, so in my opinion, the BDR should call every prospect that gets in your pipeline.
Thus the person qualifies all of the inbound leads that come to the top of the funnel and schedules the appointments for the real sales conversations with the Founder (or the Account Executive, if the team has grown).
Ideally, that’s the first personal touch of the potential clients with your company. That’s the navigator that helps the inbound leads to find their way through the funnel.
Why the BDR is so essential in the early days of the organization?
Being the first personal touch with potential prospects, the Business Development rep is crucial for every organization since they can extract super valuable information for the overall organization.
By doing the qualification process, the BDRs are in a position to take the real intent of why the prospect comes to the product in the first place, what are the real pain points and therefore can pass this feedback to the marketing & product departments so that they can prioritize activities in their work — product decisions, feature set, positioning, marketing campaigns for the target audience, etc.
The high-priority leads can be passed to the founder to work on and close them. The low-priority leads can be left with the Business Development Rep or put on a self-service mode (depending on the strategy of the company) while they focus on other aspects of their job, like outbound strategies for additional filling the funnel (social selling, cold outreach, outbound prospecting).
Why hiring a BDR prior to the AE might be the better option?
Hiring a Business Development Representative (BDR) is a low-risk strategy that is less costly than employing a full-time Account Executive. It gives the company’s founders complete control over closing high-priority deals.
Moreover, the person in that position will emphasize on getting crucial information from the prospect, instead of simply trying to close a sale. This feedback later can be shared with the rest of the departments in the organization which would lead to strengthened collaboration between departments, and feed those insights gathered into product and customer development, as well as marketing efforts.
Typically, the BDRs are recent university graduates, so they come ready with a lot of drive. If given enough time, these BDRs can be molded into full-time account executives (with the right skill) without too much difficulty.
If everything continues to progress and the pipeline continues to expand, the sales team’s next move should be to bring on an Account Executive full-time. The Business Development Representative will still manage the leads and prioritize the most important ones for the founder while delegating the lower-priority leads to the AE until they have been fully onboarded.
In this way, the sales number will keep on growing, and the Founder would be still doing sales (with the high-priority leads) but also will have more time for other initiatives and will lay the foundation for the overall sales organization.
It might be a good option to consider, right?
