Sales · Internet

Where to find talented sales folks for a growing tech company?

Anonymous

October 6th, 2015

I've acquired a startup which had growing revenue the year prior to my ownership, however the only sales person on board was let go shortly after acquisition for ethical reasons.  I've struggled over the past few months to find someone to replace him with and have tried filling the position myself to get things back on track. However, My background is primarily engineering so sales is still new to me. The company licenses e-commerce platforms using a SAAS model. 

The company is not generating enough to hire someone on salary so it would have to be either commissions only, equity, or revenue sharing. I'd even consider a sales partner/founder setup. 

Anyone have any experience finding talented sales folks and where to look? I've tried the major freelance sites with no success. Also any thoughts on a go forward plan would be appreciated as well. 

Clive Butkow Chief Executive Officer at Grotech Venture Capital Company

October 6th, 2015

Nathan I a going to provide my input from South Africa, I am a venture capatalist and until 3 years ago the COO of Accenture South Africa. I also headed up technology sales in Accenture. My opinion, is based on my experience in the corporate world of sales and now the entrepreneurial world of sales, where our VC company has stakes in a few SAAS companies. As per the previous responses, good sales people are hard to find. I recently had a similar situation to yourself in one of my companies where the CEO was not a natural sales man and we needed to hire both BD and sales people and running on a shoestring budget where we could not afford these people. We solved the problem by providing a small amount of equity that would vest over 4 years as well as a very high percentage commission on the initial sales. Sales people are incentivized by money and if you cannot do this you are doomed to fail. This compensation was highly lucrative to certain people, not everyone would work for "nothing". My 2 pieces of advice for you; 1. Do not hire successfull sales people from the corporate environment but rather sales people that have been successful in an entrepreneurial environment. There titles might be the same but their skill sets and attitude are completely different. 2. This is the one time that you are going to have to "sell", became if you cannot sell your vision for your business, to these potential salespeople, they will not come on board. Hope this helps? 





Rob G

October 6th, 2015

I agree with Clive re compensation structure - we all hear about engineers and how expensive they are, but you may be shocked at how 'expensive' good sales people are.  In your current situation you are asking them to take big risks (financial, reputation, etc.) and you need to be prepared to compensate them accordingly.  I differ with Clive on the type of experience this person should have. You can't afford to waste time getting your sales results back on track (as Tim K pointed out).  Clive correctly points out that the skill sets are very different for successful 'corporate' sales people and those will success in an entrepreneurial environment.  However, if you are going to take your best shot at this i would strongly suggest you try to find a successful sales person with both corporate and startup experience for a variety of reasons: 1) success in a startup environment indicates they are scrappy and know how to get things done with minimal resources (they'll need to wear 100 different hats) - they don't get this in the 'corporate' wold. in the corp world they have a lot more specialized resources at their disposal - marketing, PR, lead gen, an installed customer base (reference-able), technical pre-sales support, inside sales support, etc.  They will have to roll their own in your case.  2) However, with startup/entrepreneurial only sales experience they often lack an understanding of how the 'corporate' world really works and if you are selling into corporations (enterprise or SMB) you need that knowledge and experience.  This will be a difficult nut to crack, but you're an entrepreneur - you knew that going in!  Another 'go forward' option (not my preferred) you could consider is really at the other end of the spectrum. You could look at hiring someone with inside sales and lead gen experience and doing the sales yourself. This, of course, means you need to build some sales muscles but it could be a faster and less costly path to revenue.  If you are currently struggling with prospecting and lead gen this could help.  It will also force you to understand first-hand the sales issues your future sales team will face (objection handling, etc.) and better prepare you to manage a sales team. 

Tim Kilroy Analytics - LTV - Boosting Profits - Digital Marketing

October 6th, 2015

Not sure who your target is (mom & pop shops) or enterprise, but each have their own kind of sales treachery. It is hard to find a quality commission only sales person - commission only can be really difficult. Effort and quality vary greatly on the commission-only spectrum. It is incumbent on you to learn how to sell (hard to manage a sales process if you can't do it yourself). But the real issue is wasted time. If you don't have a committed partner in the sales process, you are going to have a fair amount of flameout - and a low-revenue startup has a low threshold for wasted time. Maybe you can find a simpatico company selling into the same market to help you with lead gen? I just feel like the commission-only sales resource won't get you where you want to go - and if there is a sales resource that can totally kill it in this market - they would likely have better opportunities with a base. Sales is a super-tough position to recruit for - and even harder when you have a product with unproven demand and no base. My advice would be to figure out how to leverage internal resources to do lead gen and closing sales. It takes sales resources weeks and months to become productive. A commission-only resource is likely to not make it through that ramp up period.

Peter Johnston Businesses are composed of pixels, bytes & atoms. All 3 change constantly. I make that change +ve.

October 7th, 2015

"Most startups don't fail at building a product. They fail at acquiring customers". Gabriel Weinberg

Sales was an old response to the undifferentiated factory in the industrial age.
The way to make something cheap was to churn out lots of them, all the same.
Then you had a race to find customers for them before they piled up in the yard.

That's not how buying works any more. Any company with sales people has made a fundamental error in their business model - they haven't created demand.

Often this is because they've been arrogant - they've imposed their view of what people want, rather than actually going and finding out. They've forgotten that the truly sustainable business model is to find out what people want and make it for them, rather than make something, then go out to find customers.

Instead of trying to find salespeople, go and talk to the people who have bought. See where the gaps are between what you provide and what they really want.

But don't stop there. Go and talk to people who didn't buy from you. The ones who made an enquiry. And some who didn't even contact you.

You'll find out whether people see you as too expensive. Not different enough or too different and high risk. You'll see a host of opportunities to build that product people want, not the product you like to make or find easy to do. Then go and build that product.

And you'll find out how people get information on this stuff, who they listen to, the media which reaches them and the people they involve in their decisions. Create an engine to drive this awareness, reach and persuade all of the people (not just the "buyer") and build rising and positive awareness.

You will no longer need salespeople - your customers will do that job. Media will look to you for leadership in your market. Recommenders and influencers will put you front of mind and recommending you will reflect well on them.

It sounds like a lot of work - more than simply hiring a salesperson. But you will have transformed your company and it will all be downhill from then on, with more sales, greater margins, easier promotion and an obvious path to future products.

Dina Destreza Digital Content Manager at Keyideas Infotech

October 8th, 2015

Nathan, when you are hiring a Sales professional, you would know the salary amount that he or she wants but not what he or she needs. If you can only know his or her needs, you could pay him that suit his needs by evaluating the current cost structure and provide the other amount of salary expectations in the form of equity. Regards, Dina

Rob G

October 6th, 2015

Nathan, Tim K hits on a very important first filter - who your target customer is, i.e. enterprise, SMB. Since you are selling a 'technical product' your next filter needs to be experience in 'technical sales' - software/SaaS. Then figure out where these people congregate both online and off.  Meetup is one good source - a quick search in the Seattle area shows 3 meetup groups focused on sales and 1 "B2B tech sales" specifically.  As Tim also points out, recruiting and hiring for startups is tough no matter how you slice it so the first thing you need to learn how to sell is you and your company. Also, please clarify - you say "The company licenses e-commerce platforms using a SAAS model".  Is this a product your company builds and supports or are you re-selling e-commerce platforms built by others? 

Dina Destreza Digital Content Manager at Keyideas Infotech

October 7th, 2015

Great suggestion by the members. The monthly salary and high commission rate are good combinations to attract talent. Yes, you need to hire someone with an entrepreneurial spirit especially someone who has worked on Startups or who have started new ventures in the existing organization. If you ever get a chance to hire those who have worked in Startups that has failed, please go ahead because they are ready to get their hands dirty. And in fact, they are more experienced. 

Peter Johnston Businesses are composed of pixels, bytes & atoms. All 3 change constantly. I make that change +ve.

October 8th, 2015

"You are betting the success of your company on this next hire"
Good idea?

Tyler Frieling Technology Matchmaker

October 6th, 2015

Hi Nathan,

Anymore, one of the best/only reasons to attend tech conferences is for talent sourcing. Obviously that is a generalization but its a great place to observe people in their work element, particularly sales/marketing.  Make a goal to identify people of interest while your walking the booths, then step back and see who stands out, chat with them as a potential customer, then connect with them for a more official conversation.

Obviously the selection of conferences is heavily time and location based. You can identify, vet and start conversations with dozens of people in a day, which I find to be super efficient.

I've lost count of how many people have introduced themselves to me at a conference to speak about joining their company. I'm not bragging, just reinforcing my opinion.

Lastly, I've found some good people in MeetUps. There seems to always be a person or 3 attending as a job seeker. Sales and Marketing people are probably harder to meet at these but it may be worth the exercise.

Clive Butkow Chief Executive Officer at Grotech Venture Capital Company

October 8th, 2015

Nathan the equity amount is something that could range between .5% to as high as 5%. From my experience, a sales director taking equity in lieu of compesation could be a few percentage points of equity. If you are planning and believe you can build a company that will eventually exit through a trade exit or IPO, a small percent could equate to a bucket load of money. If you are building a lifestyle type of business that you do not believe will gain huge traction than a few percentage points is not worth much. In summary the equity could be calculated on the potential exit price of your business. 

On the other question, what is pretty standard in the VC industry is the equity should cliff vest over a period of circa 4 years. The cliff vesting means that the person will receive no equity for the first 12 months and if he/she is still in employment after 12 months they would receive 25% of their allocated equity. The standard after that is you vest the balance either quarterly, I.e. They vest 1/12 every 3 months of their remaining equity over the next 3 years or what I normally use is monthly vesting, I.e. They receive 1/36 of their equity from month 13 to month 48. 

Hope that helps?