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Sharing Sales Experience at the Momentum Summit

Back on June 23, I moderated a lunch-time breakout session at the Momentum Summit at MIT.  The topic of my session was on scaling up the sales effort.  And, since so many entrepreneurs are frustrated with this subject, my subtitle was Lies, Damn Lies, and Salespeople.

My time in sales was very important in my career.  In fact, I'd recommend that every CEO, marketing, product management, or business development person spend time in sales.  There is nothing like having quota pressure and seeing how hard it is to get a customer to part with their money.  I think that my sales experience made me a better marketeer, investor, and entrepreneur.

Every entrepreneur is in sales.  They are selling their idea to investors, potential employees, early customers and partners, and just about everyone else.  In many companies, the founder closes the first deals.  One of the challenges we discussed was how to transition the sales responsibility to a sales team when a founder had done all the initial sales.

To me, the most important thing to understand before you hire any sales people is 'what's our sales model'?  This includes things like:

  • What are the best types of leads for us?
  • How long does it take us to close a deal?
  • Who else tends to be typically involved in a customer decision?
  • What is the basis of their purchase decision?  Is their an ROI model?  Or, are you addressing significant needs that can't easily be met otherwise?  Or, what?

In the end, you have to be able to turn the sales process into a recipe.  It's almost impossible to build out a sales team without a well-defined recipe.  A very entrepreneurial salesperson can help define the recipe, but you shouldn't hire more than one of these.  Get the recipe right and then start to scale up the sales team.  And, don't hire salespeople too quickly as it takes some time to integrate each one and make them productive.

Other subjects we covered include how to structure sales compensation plans, what CRM systems to use, how to figure out what level salesperson you should hire for a particular job, how to team up inside sales and outside sales, how do you know when to use resellers or other channel partners, etc.  There are no right or wrong answers to any of these as each company is very different.

I'll try to write a series of posts that cover some of these subjects over the next few weeks.  And, next year be sure to attend the Momentum Summit as the overall event was very valuable.

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Comments

Dave, you might be right, but I think that for almost every company there is some sort of repeatable process that leads to sales. Even with the most complex sales, there are usually a set of gates that have to be crossed along the way -- certain departments that have to sign off, getting business buy-in before technical buy-in, or vice versa, etc. Without a repeatable process, it becomes very difficult to predict sales success and a company ramp. And, it becomes very hard to invest in ramping up sales.

Great post. Sales is, without question, one of the things entrepreneurs struggle with most. But, I don't think reducing sales to a recipe will work for all tech companies, if by recipe you mean a consistently repeatable process that will have a predictable result. It may ultimately depend upon what you are selling. I have several clients whose products are very expensive and will require a material reworking of a well established process. Now, there will be great competitive benefits to the customers who make the switch. Nonetheless, each one has a unique set of circumstances be they internal politics or external -- the layout of the plant. While the basic value proposition is generally the same, each sale is unique.

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