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A Technical Founder’s Notes on Sales Team Management

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Re: A Technical Founder’s Notes on Sales Team Management

#31

Post by takinola »

AndrewKemendo wrote: post #28

So what I don't really understand is what exactly the "right" sales people are doing that the others aren't. I totally understand that there is distribution of competence for anything - but what is the real difference? I can only come up with a few things I can figure out on my own so maybe someone can tell me if I am missing one: 1. Understand the customer better through research/interaction and pitch a cleaner "val…

From my interactions with sales people, here are a couple differentiators I have noticed

1. Sheer relentlessness - A good sales person will follow-up on a lead to an extent you and I may consider excessive. They will make call after call, bouncing back from rejection with an unsettling ease.

2. Preparation - Good sales people are very prepared. Customer says they can't afford it, sales guy has a prepared comeback to keep the deal alive. Customer suggests a free pilot, sales guy gently deflects back to closing a revenue deal. These aren't off the cuff interactions but studiously prepared counters to sales objections.

3. Ask good questions - Really good sales people are great at asking questions that help them understand what the customer needs so they can customize their pitch to hit the sweet spot.

4. Are honest - Ok, this one surprised me. Like most people, I had the stereotype of the slimy sales guy in mind but I have been very pleasantly surprised at the number of sales people that pull the product guys aside before a customer visit to basically say "don't bullshit". They care more about the trust the customer has in them than the quick buck. Yes, really

Re: A Technical Founder’s Notes on Sales Team Management

#32

Post by beachstartup »

AndrewKemendo wrote: post #28

So what I don't really understand is what exactly the "right" sales people are doing that the others aren't. I totally understand that there is distribution of competence for anything - but what is the real difference? I can only come up with a few things I can figure out on my own so maybe someone can tell me if I am missing one: 1. Understand the customer better through research/interaction and pitch a cleaner "val…

you're missing:

7. do the above for 12 months with zero positive results, under the threat of termination, without losing any enthusiasm or energy.

99.9% of people can't do it, point blank period. they just can't. you might as well ask them to fly.

Re: A Technical Founder’s Notes on Sales Team Management

#33

Post by techdrone »

AndrewKemendo wrote: post #28

So what I don't really understand is what exactly the "right" sales people are doing that the others aren't. I totally understand that there is distribution of competence for anything - but what is the real difference? I can only come up with a few things I can figure out on my own so maybe someone can tell me if I am missing one: 1. Understand the customer better through research/interaction and pitch a cleaner "val…

This is a common, reasonable thought process that often follows from the lack of understanding of what (effective) sales people do. But it's also a big part of what make sales people and almost all non-sales people feel somewhat immiscible - especially at a startup where you're probably a tight-knit group.

the #1 thing an effective salesperson does (in any size company) is this:

-> Focus your company's energy to be as effective as possible at closing deals you'll be able and willing to repeat.

How do they do this?

#1 - Avoid wasting your company's precious time on deals that don't convert to paying customers in a reasonable timeframe. #2 - Close those deals that do. This requires skills like listening, positioning, negotiating, empathy, technical and also truly understanding the actual reasons someone is compelled to buy your technology. #3 - Manage a pipeline: fill it with more prospective deals that look like those that do close; qualify and then remove those that don't. #4 - Build trust with prospective and existing customers.

At b2b startups, sales people are there to help discover, build, and tune the repeatable sale -- this important work at a startup will help you (and your board) learn if/where it even exists!

Unfortunately, if you took 10 companies, good at sales but kinda bad at engineering. Another 10, kinda bad at sales but great at engineering -- yeah you know where I'm going with this.

Re: A Technical Founder’s Notes on Sales Team Management

#34

Post by shostack »

derefr wrote: post #30
shostack wrote: post #24

Earlier quoted context omitted.

What is interesting is the conflict of interest that can lead to. A sales leader who is responsible for both sales and marketing might have a vested interest in tossing marketing under the bus if they can't get traction or close. It also makes it hard to get projects off the ground that can have a long-term payoff since Sales tends to be very focused on the short-term tangibles, even if the former are critical to hea…

What happens when you do it the other way around: having salespeople work for your marketing team, essentially being their "finishers"? It seems like you'd get not-necessarily-good-or-bad effects like marketing feeling empowered to offer discounts and bundles through "their" sales force.

You might get that, or you might get undo blame on the sales team if lead quality is an issue. Of course, that's why it is critical to understand what a quality lead is, and have objective criteria for it.

Ultimately, I think the two disciplines, while related and needing to work together, are relatively separate. Their incentives should be aligned, and that is not always possible to implement in some sales organizations.

Re: A Technical Founder’s Notes on Sales Team Management

#35

Post by porker »

kwindla wrote: post #21
davideous wrote: post #6

Earlier quoted context omitted.

Here's a good article on why Fog Creek does not pay sales commissions: http://blog.fogcreek.com/why-do-we-pay-sales-commissions/ We don't pay sales commissions at my company, and it works well for us. It does help the sales department to work more as a team.

I'd definitely be interested in knowing more about your company, davideous. I have no doubt that not paying commissions can work for some companies. And getting comfortable with paying commissions to salespeople took me, personally, a really long time. (Too long, from the perspective of being a good CEO and doing what needed to be done to move my company forward.) The arguments in the Fog Creek post sound right, and…

ThoughtWorks dropped paying commission: http://www.thoughtworks.com/news/zero-commissions

Re: A Technical Founder’s Notes on Sales Team Management

#36

Post by mattlutze »

AndrewKemendo wrote: post #28

So what I don't really understand is what exactly the "right" sales people are doing that the others aren't. I totally understand that there is distribution of competence for anything - but what is the real difference? I can only come up with a few things I can figure out on my own so maybe someone can tell me if I am missing one: 1. Understand the customer better through research/interaction and pitch a cleaner "val…

The "right" sales person also

0. Has a good feeling for who will and won't make a purchase.

1. Doesn't waste time trying to convince people who won't make a purchase, to make a purchase.

2. Have magnetic personalities with respect to the target market, and easily develop trust with members of that market.

Re: A Technical Founder’s Notes on Sales Team Management

#37

Post by berkay »

angersock wrote: post #29
pbreit wrote: post #9

Earlier quoted context omitted.

Downvote on the first sentence which is incendiary and probably wrong. And even with the edit, you still don't really get that many businesses live and die by sales. Product is relatively easy to build.

"probably wrong" if you are only looking at engineer salaries at the coasts or at BigCo. I very much get that businesses live and die by sales--anybody who's been in a startup (much less founded one) does. But I also get that part of the reason the product sells is because the people working on it are personally invested in the outcome. The engineer trades a somewhat higher salary and lower ceiling for the ability to…

The challenge is measurement. For sales people, it's easier to measure the individual sales, hence you can have commission based on individual performance. For developers it is much harder to measure individual performance.

We have implemented commission for developers based on overall sales number. Based on pre-announced targets, developers can get 1x, 2x, 3x salary as a bonus/commission at the end of the year. No caps.

Re: A Technical Founder’s Notes on Sales Team Management

#38

Post by davideous »

kwindla wrote: post #21
davideous wrote: post #6

Earlier quoted context omitted.

Here's a good article on why Fog Creek does not pay sales commissions: http://blog.fogcreek.com/why-do-we-pay-sales-commissions/ We don't pay sales commissions at my company, and it works well for us. It does help the sales department to work more as a team.

I'd definitely be interested in knowing more about your company, davideous. I have no doubt that not paying commissions can work for some companies. And getting comfortable with paying commissions to salespeople took me, personally, a really long time. (Too long, from the perspective of being a good CEO and doing what needed to be done to move my company forward.) The arguments in the Fog Creek post sound right, and…

We sell enterprise email server software. It's high-touch and sometimes a long sales cycle. Lots of demos of the software via screen-share.

Right now we have two people in sales. They are collaborating multiple times a day on Skype and help each other out on basically every sale.

Much of your concern seems to be about the ability to hire the best people, given the preference for commissions. I've been fortunate here: I've been able to hire my sales reps through personal connections, based off of reliably knowing their prior performance -- and I know I have really good people.

Perhaps it would have been harder to start the sales organization without commissions without these connections. But it's working for us right now.

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