How to Build Your Sales Team
Not just any team — the team that’s right for you
For founders with no sales background, the topic of sales teams can be no fun. Zero to One makes the argument well: there is an assumption that sales “will flow magically from the creation of a good product.”
That’s true, but only for a while.
Market/product fit will initially grow your company, but eventually you’ll hit a ceiling. Even among viral products, once you pass adoption by innovators/early adopters you will need a sales team to scale, especially when trying to grow your market share.
Here is a short primer on how to think about this process, from someone who’s worked both in small and large sales teams. This primer will help you figure out what sales team is right for your company, by asking two easy questions:
1. How much discretion does my customer have?
Figuring out complexity is all about your customer and their personal discretion to make “the decision.” That’s the point when your customer says, “We will use your product or service/ We will not use your product or service.” Think of this like a spectrum. On one side is the simple sale and on the other is the complex sale.
It’s tempting to think that simple sales correlate with company size, deal size, or industry, but there’s no substitute for understanding your clients.
Massive companies could have a distributed decision-making model, with regional offices calling all the shots. Massive companies could also have a benign-dictator CEO: that’s a massive amount of decision-making in one place. Small companies could instead make decisions as a group.
Either way, you need to understand the process by which decisions are made inside the company, and by whom.
Complex sales are another beast. Just because there is a decision-making process doesn’t mean there is complexity. A good example of a truly “complex” process is how a U.S. bill becomes a law. There isn’t even a single decision-maker.
To measure complexity, ask yourself: who is my decision-maker and how much discretion do they have?
For example, a bill is an idea that has to navigate a complex bureaucracy.
2. How short is my sales cycle?
To understand sales cycle, think about how your product will impact your customer, their company, and the way they do business. Enterprise sale cycles are often long because they feed into a long corporate strategy cycle, which plans for trends and ideas several years into future.
When you sell into an enterprise environment, your product can impact years of people’s work lives.
Here, also, it might be tempting to think that the sales cycle always perfectly correlates with company size. This thinking can get you in trouble. Big companies will pilot small projects, or condense the sales cycle because they have a pressing need. Make as few assumptions as possible and see what customers in the real world tell you.
Building the Right Kind of Sales Team
When we take these 2 measures, here’s what we get:
Once you understand where your product/market fit exists, figure out what kind of sales team you need. You may need several.
The Different Types of Sales Team:
1. “The Why Not?” — Short sales cycle, low complexity
This is a numbers game and you’ll win this space with big energetic teams. With the combination of market/product fit, the right compensation plan, and people that can absorb being told no, you’re off to a good start. Focus on a large team that optimizes reaching the customer and being told yes/no. Often, this could be done by phone. Beware burn-out among your sales team, and motivate them accordingly. Track and encourage numbers. Also, beware that your cost to acquire customers doesn’t exceed their lifetime value for very long.
2. “The Car Purchase.” — Long sales cycle, high complexity
A good marketing/sales team relationship is needed here. As the name is meant to suggest, this is a lot like a car purchase. Decision-makers here will do a significant amount of research and thinking before the sale, and your sales people will often come in at the late stages of the purchase. Brian Halligan, at HubSpot has a good piece about building a nice sales funnel that I suggest you read. You’ll need to align customer needs, company needs, and sales incentives. In his piece, Halligan talks about how focusing on a few specific personas rather than the proverbial “everyone in the market” made a huge difference in results.
3. “The Emergency.” — Short sales cycle, low complexity
This won’t be a long-term market, because some kind of crisis has precipitated sales. For example, a major market shift or the emergence of a new technology with huge levels of adoption could push all enterprise organizations into a war-room decision-making mode. The emerging domination of online commerce around 2010 is a good example.
Here, you’ll need an interesting skill-combination: ability to handle both volume sales and possession of (let’s call it) “corporate intelligence”: which is the ability to understand (and then navigate) the process by which large organizations make decisions.
Senior people from the industry you’re selling into and people who have been on the other side of the buying table are a natural choice. You could also try to get this skill combination from multiple people: pair someone with senior experience with a junior sales team that will manage the sheer volume of work necessary. In either case, be aware that at some point this window of opportunity will close.
4. “The Enterprise Sale.” — Long sales cycle, high complexity
Corporations have their own logic when making a decision, and you’ll need someone who balances the ability to understand the decision-making team, corporate culture, and patience. The folks at General Assembly have a good primer on this process. At first, this may have to be a job for the CEO and your VP team, but if you have traction, this should prioritize a team of people who understand how corporations operate. Hiring from the industry is an easy shortcut, but you could also look for the following qualities: understanding how truly “complex” system operate, ability to navigate bureaucracy, understanding long-term strategy, and good cycle communicator. Also, your marketing team should be on-board with supporting this group.
So, to summarize:
- Figure out your decision makers, and their discretion to buy.
- Measure your sales cycle.
- Don’t try to short-circuit the process by correlating deal size or company size with the two measures.
- Figure out the sales team(s) that are right for you.
