The 3 Growth Stages of Sales Hiring for Your Startup — Cowen Partners

At the very beginning stages of a startup there are very few employees, and most of the time a sales representative is not one of them. This means you, as the CEO or founder, are likely the person in charge of pitching and selling the product to potential clients. At this point in time, you should be doing sales exploration to gain a deeper understanding of your customers while also testing different sales strategies and gaining insight into the overall market.

As the CEO of the company, it’s likely sales are not be your favorite aspect of running a business. You’d much rather be focusing on new innovations and conceptualizing ways to improve your product, but sales are how you grow. Your first few sales and the market research you collect are vital for achieving the next three phases of startup sales growth.

Stage 1: Your first two sales reps

The next stage in the growth of your startup is to hire your first two sales representatives. At this early stage, you should be looking at young sales reps who are just starting out, not a veteran representative. You want the fresh-faced sales reps for a couple of reasons. First, young sales representatives are often eager to develop their skills and try new sales methods to see what works for your company. Second, less-experienced sales reps are cheaper to hire. You can bring two salespeople onto your team right at the beginning to increase your outreach without paying them quite as much as a more veteran sales leader.

Before diving into hiring, however, you need to make sure your business is ready for this growth stage.

Timing is key

It can be difficult to pinpoint exactly when you should hire your first couple of sales representatives. You need to ensure you have room in the budget for another salary, plus you need to make sure you fully understand your market and sales cycle. Below are a few key milestones you should hit before hiring your first sales representative.

1. 10 clients
   You should aim to have at least 10 solid customers before you start outsourcing any sales talent. Ten clients tell you two important things. One, you know people are willing to buy your product/service, and two, you understand how to sell your service.
2. Solid sales process
   You really shouldn’t hire a sales representative if you don’t have a sales process in place. You want your new hire to jump right into the sales game with a structured sales framework, not a haphazard vague idea of how to approach customers. A sales playbook will give a new sales hire all of the information they need to succeed and make your company successful, too. The following is a list of a few details your sales playbook should include:

• Summary of the company and product/service
• Outline of the sales cycle
• Customer profile
• Call scripts and email templates
• Key performance indicators

Stage 2: Establishing sales leadership

By stage two of startup growth, you should be seeing consistent sales and growth within your company. You have an effective sales strategy and sales funnel as well as 3 to 15 sales representatives working for your company. At this point, it’s time to start hiring sales leadership positions such as a sales manager or sales director.

What to look for in a sales manager

When reviewing possible candidates for your sales manager, you want to find someone with experience leading teams as small as three people to as many as 30. Look for a candidate with a background as a junior sales representative who worked their way up to a leadership role. The sales manager will help ramp up your company’s growth and expand your capabilities.

The main three goals of a sales manager should be to refine the sales process, effectively manage the sales team, and lead the team through various training and coaching. Below are a few main characteristics you should focus on when reviewing potential sales leader candidates.

• Passion
  You want a passionate sales manager on your team. A person with passion who believes in your company will work much harder and be more engaging than a sales manager who is just in it for the money.
• Persistent
  Working for a startup takes a certain level of persistence. You need a sales manager who is willing to go the extra mile for clients and who can push a sale like no other.
• Tech-savvy
  The ever-evolving digital landscape makes tech-savvy leaders imperative to the growth of your business. This is particularly important if you run a SaaS startup. Your sales leader needs to not only understand your product, but also how it fits into the industry and market.

Stage 3: The senior sales leader

The next move to stage three of your startup sales hiring is crucial. A senior sales leader will play a major role in your growing company. Not only is this position important, but it’s also expensive. To lure a VP of sales to your startup, you’re going to have to offer a hefty salary as well as equity in your company and extremely competitive benefits. Of course, the high price point that comes with hiring a VP of sales is worth the return.

Once you reach 25 or more sales representatives, it could be time to start thinking about hiring a senior sales leader. It’s around 25 sales reps that you start needing someone who can manage all of your sales directors/managers. Along with managing the junior sales leadership, the VP of sales is responsible for opening new offices, closing big client deals, and scaling your sales channels, just to name a few. An experienced senior sales leader has the potential to skyrocket your company growth, so make sure you put serious consideration into the candidate you choose for the role.

If you liked our “The 3 Growth Stages of Sales Hiring for Your Startup”, you might be interested in these other posts about executive recruiting:

Originally published at https://cowenpartners.com on November 18, 2020.