Most early stage startups hire sales people way too early. In fact, in this world of rapid iteration, the impetus to hire your first salesperson fast is even greater. Your product will only achieve product-market fit with customer input. Where do you find customers if you don’t have salespeople? Your first couple of hires might be engineers, but you should probably go hire a salesperson pretty quickly, right?
Actually maybe you need to hire a sales leader or manager, right?
In the early days of iteration on product, it absolutely makes sense to get customers involved. Once you have a hypothesis on both the BIG problem you want to solve and the way you want to get started in that market, you need customers both to validate the problem and to iterate with you on the solution. At BloomReach, we launched on our first pilot customer in July 2009 not even three months after we’d established our four person engineering team. Signing up an early customer was an essential way to drive towards execution and away from debate. It clarified priorities in a way that nothing else could have. Over the course of 2009, we signed up five-plus pilots and monetized our first paying customer in November 2009.
Where do you get that initial cohort of customers and who gets them?
Ideally, you (the founders) or your product manager (general business person) get them. No salesperson worth his or her salt is interested in selling your half-baked idea with little to no cash incentive. You use your network. You cold call. You show up in potential customers’ lobbies. You go to industry trade shows and hang out as people exit (to avoid paying exorbitant conference fees). You use your school ties. You do anything and everything to get meetings with the right people. Then, you pitch your product to your prospect in a way that is both transformative and realistic. It sounds something like this:
“I am building a product that will drive $X million in revenue, or $Y million in savings or make your life much better in Z way, I’d love you to try it. If you partner with me on this and we succeed together, we will potentially create an industry-defining transformation in your business. Of course, we will have plenty of bumps in the road because this is an early product, and we’ll work through those together.”
If your pitch is compelling, the early adopters will self-select in. You’ll have an initial set of customers to iterate with – all set-up with the right expectations. You may not be the best salesperson in the world, but you know your vision. You (likely) are one of the few people to believe in your product. And your job is not to sell a static product, it is to be part product manager / part salesperson. The learning around the product’s viability is actually a lot more important than the transactional value of the sale.
Your product needs to get to the point where it is very interesting to 5 out of 10 early prospects in your target segment. That number will drop materially once you scale out sales and ask for real money. You may ultimately hire better salespeople than yourself. However, they are not likely to be able to adjust the proposition on the fly to converge the product with the market and therefore you will miss out on valuable product-shaping opportunities. In BloomReach’s case we hired our first salesperson in July 2010, after we had already won 10 customers (many of them turned out to be outside of our desired target market but they enabled us to find a sweet spot). At that point, we hired our Sales Ninja – Hank Lemieux. As Historian Hanawa Hokinoichi writes of the ninja’s key role:
“They travelled in disguise to judge the situation of the enemy, they would inveigle their way in the midst of the enemy to discover gaps, and enter enemy castles… always in secret.”
This is in contrast to the better known Samurai – many of whom you will need later in your business’ lifecycle as you try to scale. Samurai are all about their strict rules of honor and combat, much more akin to the “scaling-oriented” salespeople you will need later.
I met Hank at a Tapas restaurant in Mountain View, Calif., and knew by the end of lunch that he was the right guy for us. He was charismatic, asked a ton of incisive product-oriented questions. He was not initially focused on the compensation or the position. He was excited about the problem. He was excited about the technology. And he was ready to bet on his own ability to take an immature technology to market. He was a player/coach – happy to coach but unafraid to play.
He didn’t have many questions for me about the sales process (good, because we did not have any) or about average deal size. Fundamentally, he understood that it was his job to create those, not to expect those out of an early stage startup. He was all about creative solutions to problems. He was inherently optimistic. He really focused on the key people involved and was motivated by market creation. At the same time, he was a salesperson, not a product manager. He knew how to qualify, how to probe and how to lead a customer to a logical conclusion that ours was the product to buy. And he was not afraid to talk about money. Hank is in a role today as Head of New Product Sales at BloomReach. He is as effective at bringing our new products to market today as he was then at helping me build out our early sales efforts.
Your Sales Ninja is there to acquire early customers by any means necessary and then to put enormous pressure on your product/engineering team to deliver. The interactions between your product teams and your Ninja should be tension-filled at times. He/she is there to represent what it takes to sell and help you develop a repeatable set of processes that can allow you to scale through Sales Samurais. That does not happen if he/she does not crisply articulate what is/is not working in the market and what it takes to sell. Without that, you are not ready to sell in a repeatable fashion.
The characteristics of your Sales Ninja are vastly different than that of the Samurais you will hire later, or even your eventual sales leader. If you hire your Samurais too early, they will burn out and leave you. And you won’t know if it was bad selling or bad product that doomed you. If your Ninja sets things up properly, you will be ready to take the market by storm.