Running a start-up is considered in vogue these days, with venture firms pumping money into new ideas and innovations at record valuations. Most entrepreneurs are extremely excited and passionate about their product or solution and want to have global adoption as quickly as possible. After spending a majority of time developing a software or product, that anticipation starts to build, as we look to take our “baby” to market.
In the myriad of this excitement, we as CEOs of these companies start pushing aggressively to bring in sales and revenue, as that is the “lifeline” of any start-up. Every day we get up dreaming of how quickly can we sign up that first customer or build out a partnership which will lead us to our first major revenue milestone.
Till now, most of us would have boot-strapped our way by cutting every corner to get to where we have, either purely through personal savings being depleted or having a few Angels who have backed our vision and supported us financially to create a product. In today’s market, some are lucky to get early stage VCs willing to invest in an idea before it gets off the ground.
Regardless of the means, all of us have worked on managing our “burn” to the best extent feasible. The fun starts now, as we start forecasting sales and growth and how we are going to reach a billion dollars within five years. The endless dreams we have every night of being the next Zuckerberg or Segei, building companies from scratch that change and revolutionize markets, brings about endorphin rushes within each of us.
As we focus on accelerating our revenues, we look to invest heavily in building out a sales organization which can take our product to market. In doing so, we make a key fundamental mistake as we look to hire the “all-stars” from big firms who have achieved great success but may not have done so at a startup. In a large firm, there is access to a support ecosystem and an inherent value to the brand that are key contributors to the sales people being successful.
I am not stating that sales reps in big firms don’t deserve credit; I am simply stating that there is an entire infrastructure behind the reps that assists in helping them get from identifying the opportunity to closure. As a startup, we don’t have such luxuries as we look to establish a brand and don’t have the necessary resources to corral around the reps. Having made this mistake in my past ventures, I would highly recommend that you, as the entrepreneur and CEO, do the first few sales yourself. There is no better champion of your product than you! The passion exudes from every pore, the eagerness and relentless ability to keep talking about what you do and how your product can bring value can never be shared in the same manner by anyone else. Regardless if you are a technical founder or not, an entrepreneur’s passion for their creation is self-evident.
Once you have established a few clients that can validate the value of your product in the marketplace, it is the correct time to look to bring on a couple of sales people to start scaling. I have found that the best reps are ‘player-manager’, by that I mean someone who is willing to carry a bag and open doors but be able to groom into managing a territory or team as you scale in the future. Most sales reps promise the world and unfortunately under deliver. My philosophy is that sales is about relationships, what you are buying by hiring a sales person is their rolodex to open doors and accelerate time to market.
At Data Dynamics, we ask each rep that is coming on board to give us a 90 Day Plan. The 90 Day Plan is exactly what it states: “what can you deliver as a rep, leveraging your rolodex and close in the first 90 days you are onboard?” Most candidates are not happy to see this level of pressure and typically will walk away from the opportunity to join, but the ones that do are the ones that believe in their eco-system, know they have the ability to deliver and will take on the challenge with full vigor. It is people with this type of passion and confidence that you want to help drive revenue.
Once you have a few reps on board, you will build a culture that embeds this urgency to deliver and forces only the “A” players to join, as having the pressure of every 90 days delivering results is not meant for the faint of heart.
Although there is no science to finding the right individuals, having made several mistakes in the past, I have learnt from them and hope that sharing my experience provides value and helps avoid you from making some mistakes in your ventures.