A Technical Founder’s Notes on Sales Team Management

Thanks, lots of great insights in here. Jives with my instincts, but important to hear it from someone else as well.

Interesting to see the justification for screwing engineers on the pay.

EDIT:

To clarify--the idea of commission is effectively an equity stake in either the revenue or profit (depending on the setup, right)?

So, the sales folks see an immediate return on their work. The engineers, while salaried, have no such visceral link to the performance of the product...just some trivial paper and the thin sliver of hope they won't be fucked over during an exit.

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.

Even when lead-gen lives inside the sales organization, the salespeople who generate leads and the salespeople who close deals are generally not the same people. It's a different skillset to hammer the phones and repeat scripts than to gauge technical fit and negotiate.

The reason to have lead-gen live in marketing is because modern lead-gen is often based on marketing initiatives. For example, a good source of leads are people who attend webinars, read blog posts, or watch videos, all of which are organized and pushed out by marketing. You're correct that a marketing team does much more than just generate leads for salespeople to follow, but generally the entire goal of marketing is to generate targeted awareness in the market which raises the value of the company through mind-share or revenue.

There's a lot more to say about this shift, as the job of a salesperson today is very different than the same job even 5 or 10 years ago. This has a lot to do with the relative amount of knowledge out in the wild. In the good old days, you didn't really even know what a Xerox machine was until a salesperson told you about it, let alone all the ways you could use it to help your business. Nowadays, customers are doing more and more research (through marketing materials) to guide their decision making process before ever talking to a salesperson.

Imagine if you as an engineer were told your total compensation was $150,000 per year. But only half of that would be certain. The other $75,000 would be dependent on how many unique features you helped ship in a month/quarter/year and how many of those were bug free. And you didn't have full control over the release cycle - there were a lot of dependencies with other orgs (devops/QA/product management) And as your company grew they could yank you off a feature about to release and put you in a new group where you were just starting to work on a new release. You had to assume that your company wasn't going to screw up and impact your ability to ship. That's at least the right mindset to compare yourself to sales person compensation. And remember, technical sales people can do very well so if it looks more attractive you should think about making the leap.