HACKER Q&A
📣 legostormtroopr

What should a co-founder look for when hiring our first salesperson?


I am CEO and co-founder of an profitable Australian startup. We've grown 100% organically without outside investment, which has positives (founders still have 100% control/ownership) and negatives (lack of investment has meant slow-ish growth and limited new ideas/support). Because of this we have generally targeted safe recurring revenue from the public sector.

We've done relatively well putting ourselves into our market and have won out over some bigger incumbents, but sales requires a certain outgoing mindset that no-one in our team currently possesses.

We're at a point where we have enough technical and product staff to easily support 20-50 times more clients and have a full pipeline and excess captial to invest in finally building a proper sales team to meet our potential.

The question I'm stuck with is how to we find, interview, hire and retain our first sales/business development staff.

How have other technical founders interviewed for sales, and what are the right kinds of questions to ask? Is salary + commission enough, or should we expect to start having to give away equity as well? Where is the right place to advertise for sales, and are there any good resources to pull from?

  👤 sellmethepen Accepted Answer ✓
I could share a sales perspective on this and hopefully that helps a bit. Depending on the maturity of a company I think the type of sales person you hire changes as you go from early stage (<$1M) to growth ($1M-$15M) to beyond (the right environment will allow your reps to mature and grow with the org). One thing that's crucial at this stage is that you get along well with your first rep. You can't expect to just give them the info and leave it completely to them. As CEO you really need to partner with them and ensure success, essentially teach them the playbook of how you're doing these initial deals and from there most reps will start to add their own touches to the sales process. Begin documenting and tracking some basic items like ideal client profile, sales cycle time and average deal sizes (this is useful for funding and recruiting future employees).

To your question on where do we find reps - honestly a really underrated approach is to do some 1-1 outreach via platforms like linkedin (if you the CEO are reaching out to reps that's enough for most reps to want to take a meeting and learn about you and the company). For these first sales hires I would shy away from the large company reps (e.g. Oracle, Microsoft, etc) - try and find those reps that have some startup experience and have worked at young companies.

Some questions to gauge aptitude, etc: * How they would think about handling initial day to day sales as well as building the foundation for the sales org (if they'd even have any interest in doing some of the foundational work). * Ask them if they've hit their numbers regularly (if not, why - keep in mind early stage sales is a bit of a crapshoot) - you'll start to get a sense of the rep and their style * What early stage experience do they have? How do they do outreach? * A regular ask from most sales managers is a 30, 60, 90 day plan (ask them to do some basic market research and think about potential prospects, etc).

Regarding compensation most early stage SaaS companies I've worked with do a combination of salary, commission and equity. It sound like you guys are majority owned so might not make sense to give equity away if other employees aren't getting any.

If you have some time there's a lot of information out there around the first sales hires (John McMahon's stuff is quite good around sales process/cycle - a lot of the stuff from the sales leaders at AppDynamics is pretty solid).

👤 davismwfl
A lot of the details depend on what level person you want to bring in. My 2 cents, having done this bootstrapped more then once before, is to hire in good mid level sales people who have networks in the space you are in. Do not hire a VP of Sales or similar type role, hire in a few sales people and dice up the pie and let them compete, the one who does the best, find more like him/her and help the others learn or cut them if they can't make it to the same level. Once you have a small team that is selling and has made some progress then you can start looking into hiring a sales manager/VP of sales etc.

One (of many) mistakes I see too many startups make is hire some high end VP of Sales because the founders lack sales experience and think you need that person to lay out a plan for the young company. Yes, a good VP of sales can lay out a plan, but there is a massive difference between someone like that and a person who just pounds the phones, emails etc to get sales moving. Get people to get sales moving, to learn what works/doesn't work and measure how and what they are doing so that you can refine a system and train new people. Then when you bring in a more experienced VP they can take that basic system and scale it and tweak it in ways you don't understand (yet) and things will grow.

I like to iterate on sales like you would engineering, most good sales people I know do that naturally too. So don't be shocked if you go through quite a few sales people till you find a fit for your team and market. That is fairly normal in my experience if you are moving fast. If you are moving slower and can take more time then you might go through fewer but your lead time to hire will be much longer. Just tradeoffs.

As for finding them, look to competitors in the same market space and hire away their mid level people, or find people that have sold in a sister market. Targeting people is usually a good way, over placing ads and most recruiters can help you with this if you don't know how.

Interview sales people with normal questions and by introducing them to your product and then have them sell you on it after a 10-15 minute intro & question session (pay attention to the questions good mid level sales people ask lots of detailed questions typically). They'll screw things up in that presentation, see who can dance on their feet and not lie, embellish or back themselves into a corner. Pay attention to how they handle being in that position cause it will happen for real in 6-8 months on the job too.

Compensation can be hard to figure out at first so it will take some time, work with them to find a balance between what motivates them but doesn't break you or upset your balance. I always avoid equity on sales positions and they generally want cash anyway.