How to hire a sales person
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1) Sales vs BizDev - As described in the article the sales people he's looking for are great for one off transactions, not for building a real client base that will refer and keep coming back. Remember how you like to be sold, for bigger things most people want to know and trust the person they are buying from.
2) Domain Knowledge - which is easy to teach, sales or what you do? Hire a good salesman and teach them your business
The idea is sound and I've seen a number of startups go the wrong way with it, but those two stood out to me.
On domain knowledge-certainly its easy to teach what you do than teach how to sell. Always better to get a strong sales guy than the other way round. In the article I was reference the difference between one with industry knowledge and product knowledge.
Also, I feel like focusing on domain knowledge too narrowly can lead the hiring process astray. I think you are spot on regarding hiring for intelligence and acumen but I think it is a mistake to think that those attributes can only be found in those with domain knowledge. I can tell you that I knew nothing about video encoding before becoming Zencoder's head of sales and had it been a requirement, I wouldn't have been hired. We were able to grow that company rapidly to acquisition with only myself focused on sales.
My opinion is that a good sales hire should be 1. fully committed to learning your product inside and out and have the technical acumen to be able to execute on that. 2. Should think about sales the same way the engineering team think about product (test, iterate, listen,) 3. Should be able to sell themselves they way you want your product to be sold. Listen to how they talk about themselves in the interview. This is how they will sell your product.
re: winning deals vs generating deals: winning deals = generating leads + proposing a solution/pitch + dealing with contracting + get technical/architectural support from core team + following up on sales commitments.
Anything else?
Re domain knowledge: value of hiring smart reps> hiring reps with marketspace knowledge > hiring reps with product knowledge
Re how candidates carry themselves: one of the things to watch for is how they conduct themselves with customers. I have in the past taken candidates to networking events to get a feel for how they work in a social setting.
2. Skills: a skill that may be more useful than building a plan would be the ability to close. Assign some leads and see if the person can actually close. http://www.youtube.com/watch?v=wVQPY4LlbJ4
3. Accountability: Often the worst part about great salesmen is that they are great salesmen. They will sell themselves and you on doing as little work as possible. A basic CRM to monitor his progress may provide an equal or better ROI than the salesman himself.
4. If you are short on cash, you can build a sales team on commission only. This book has a few ideas on how to set that up: http://www.amazon.com/The-Ultimate-Sales-Machine-Turbocharge...
2. I did not mean to imply that a CRM is the only form of accountability, more that in an early stage start up with tech founders, it may be the easiest/most cost effective way to implement a system of organization and accountability. The value of a CRM at any stage cannot be underestimated, not only does it give accountability but it gives instant prioritization so that the sales person's time is maximized and they can reach buyers at the exact moment they are most ready, willing, and able to buy.
3. Many studies have shown that when human performance is measured, productivity increases. In real life, I cannot remember one nationally ranked salesperson that did not have system of organization and accountability. The Hawthorne Effect is probably the most quoted research on this subject, although it may not be the most on-point. "Researchers concluded that the workers worked harder because they thought that they were being monitored individually."
From my view, sales is often a numbers game. In order to get x sales, y appointments must be set, z connections made. I am yet to find a good method for measuring this outside a CRM. Excel is good for about 50 contacts.. After that, it's a mess.
1. This is a self selection hack: The renaissance sales rep will be drawn to the problem and will want the intellectual challenge of thinking through a new problem. The coin operated ones will instinctively get turned off by your request for a plan and will self select out. You anyway don't want to hire one of those.
Also, most sales reps spending their days staring at spreadsheets, CRM systems and drab presentations. This will be a welcome break.
2. Helps them research their probability of success: Good sales reps don't like to lose in the marketplace. These are individuals who are motivated by winning deals. They love the chase.
Preparing a plan helps them evaluate their chances of success.From a career standpoint they wouldn't want to join a company only to be let go after sometime because they couldnt make quota. It reflects really badly in their next interview.
So a smart sales guy would want to research before hand if the market is hot, is the product unique?, who is competition? what are the prospective customers that he has connections with?
He is going to do this irrespective of whether you ask him or not (red flag on his caliber if he doesn't). Why not make it a part of the process?
Btw, judging the specifics of the plan is not as important as judging the process of his planning.
Sales executives that are trained and deeply experienced in sustaining innovation sales models are great when the repeatable sales model has already been discovered, documented and integrated into the entire organization, including the marketing and product. At this level, the role of the Sales VP is there to "caretake" the sales organization through the maturation stage of growth and dependable business objectives led by the CEO. Their rewards are aligned with the ability to keep the engine humming or fine-tune it for increased sales revolutions.
In a startup, prior to full discovery of the repeatable sales model, one should avoid any sustaining innovation Sales VPs like the plague. One should take a bigger risk on high-energy, untrained sales reps/managers, who are capable of learning disruptive sales models and can be trained (and retrained cheaply) to patiently listen to the customer buying cycle and business circumstance around which a new marketing model must be built. It is my view that most VP of Sales are not trained for disruptive and innovative sales roles because their experiences were anchored around very predictable revenue models.
At the VP of Sales level, there are many ways to vet a candidate and those methods should align with the corporate structure and the corporate culture. However, let’s be clear. The first VP of Sales or VP of Marketing are high-risk hires who the CEO should be prepared to replace as quickly as possible as the product market fit process, customer segments, and customer buyer-cycle and buyer-profiles continue to change and settle.
Don’t get obsessed over your first VP of Sales as “The One”
Obsess that you have athletes that are capable of running a hard sales race and that your organization is nimble enough to adapt and change, as needed to survive the sales discovery process!
thoughts?
any other ideas?
If you know by putting in X sales reps with $Y sales productivity per rep you can achieve $Z (X*$Y) in sales then that is a good case for hiring a VP of sales and have him build a sales organization under him.
Once you have some traction and a solid product, a great VP of Sales will help you scale your early success rapidly.
VP sales has to manage revenue pipelines, analyze sales reports, detect account losses, manage promotions, get involved in contract negotiations, etc.
Salespeople network, originate leads, cold call companies, build relationships, close deals, etc.
The best salespeople often make terrible VP sales.