When is the right time to hire a sales person in a startup?

The answer to this question depends on the stage of the startup, the nature of the industry, the current team’s capabilities and competencies and the resources available for hiring and retaining the appropriate sales person. 

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Sales people typically like to work with companies where the processes are well defined, the value proposition has been proven and the marketing material and sales packages are all working smoothly. They usually like to achieve their numbers and targets, measuring themselves against their peers and their own achievements on the basis of how well they have achieved their targets. Hardcore sales folks do NOT typically like to be trapped in working and reworking processes, strategy, pricing, sale packages or even experimenting with different value propositions to different customer segments.

Ideally, you should hire a sales person (senior or junior), when some of the uncertainties of the business have been tested and proven.  

In the initial phase of the business, you will not / cannot know what price points will work, which audience segments will respond better or what communication messages will deliver better results. As a result, a new sales team tends to interpret this phase of ‘experimenting’ as “the management is undecided and unclear about what they want to do”, and hence start looking around for more stable opportunities. A sales team or the head of sales, leaving the company soon after joining, sends a wrong signal to the market – not just to other sales folks, but also to other members of the team, customers, vendors and investors.

Also, if you don’t have a challenge big enough for your sales head, he may not enjoy the work. You should therefore start hiring sales folks when the organization is really ready to leverage their skills and competencies, and provide them enough motivation and material to go and win in the market.

However, it’s not always possible to wait for things to settle down, before you hire a sales team.

So, if you really do need a sales person at the early-stages of your journey, make sure that you explain the current stage to the sales person, clearly define what his or her roles and responsibilities will be in this phase (e.g. could be – to help define the marketing and sales packages/programs) and honestly apprise them on the role that they will have to perform in the initial phase. Enlighten them that every startup goes through this phase of discovery, and emphasize the FACT that they will learn a lot from this phase than they would in just any sales management role. Position it as a positive and do not be defensive about it.

Even if you – an entrepreneur, are not a sales person, recognize and appreciate that the sales people are motivated differently and that you need to understand their mindset to be able to challenge them, motivate them, encourage them and reward them.

Happy Hiring !

 

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Author: Prajakt Raut

Prajakt Raut is the founder of Applyifi.com, and author of the book for startups - ‘Starting Up & Fund Raising’ Prajakt personal goal in life is to encourage and assist a 100,000 people to become entrepreneurs. _____________ Prajakt is the founder of Applyifi - an online platform that provides startups a 36-point scorecard and assessment report on the venture's investment readiness [www.applyifi.com], and helps them improve their odds of getting funded. Prajakt is also the founding partner of The Growth Labs, a platform where growth-stage companies get sharp, incisive advice from senior professionals and experienced entrepreneurs. [www.thegrowthlabs.in] Before starting Applyifi, Prajakt was the head of operations at IAN, founding member of a leading incubator, and the Asia-Director for TiE (2004 - 2007). Previously Prajakt had co-founded Orange Cross, a healthcare services company, and was part of the founding team member of Idealake Technologies. While in college Prajakt had founded a printing business and has spent over 10 years working in leading advertising agencies. Prajakt’s book, ‘Starting Up & Fund Raising’, helps startups understand an investor’s perspective, and helps them improve their odds of getting funded. The book also helps entrepreneurs understand the building blocks of a business.

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