Your startup will need solid sales management expertise to scale. Very rarely do founders have prior experience of scaling and managing a large sales operation. You will probably need to hire a VP of sales to scale — the question is, when? Any mistake is very expensive. Too late and you miss out on the all the growth, with resultant opportunities to raise capital (at a higher valuation), and you might even concede market lead to a faster competitor. Hire too early, and not only do you have an expensive resource draining precious early-stage capital, but we have seen numerous stories of rock star sales professionals failing in a startup (more on this later), especially when hired too early. Stakes are high. So how do you decide the right time to bring in a VP of Sales?
Well, to start, definitely not in the beginning. When your product or service is in a nascent stage, founders need to sell. The best definition of sales I have come across is: “transference of feeling from the salesperson to the prospect”. To transfer the right feeling (confidence in your product), you need to first have the feeling. Who except the founders has the feeling in the beginning? By definition, nobody except the founders can sell in the beginning. Only you understand the intricacies of the product enough to adapt your pitch on the fly. Only you can make a promise which the product might not deliver today, but can with a quick adaptation.
Most importantly, in the beginning, before you have a credible, validated product with referenceable clients, you have to sell yourself, your own credibility — which no hired professional can do for you. If as a founder you are unable or unwilling to sell — you are not ready to be an entrepreneur.
So have to sell the first few customers. Reach out to your personal network and start from there. Tell a story. Create a pitch and keep refining it (often on the fly as you are listening to your customer), till it works reliably and repeatably. When you find a story that works repeatedly across customers, develop it to a level where others in your team can deliver it and add reference points (such as customer validation, and ideally, customer success stories) that create credibility. This becomes your sales proposition.
Until you create a sales proposition, you can’t think of hiring a VP of sales. The sales proposition ought to have been proven at least at a small scale. This proven pitch should have already gotten you your first few customers. You need to have figured out how you handle the objections. Understand (to some degree) what profile of customer will buy your product. Know why and how you’re winning or losing.
Once you do all that, a VP of sales knows better than you how to scale up. He or she will create and professionalize the sales management and process. They will refine the pitch, build a pipeline, organization and process, and scale up a rate you were unlikely to achieve on your own. But he or she cannot get you your first few customers. That’s something only you can do.
When it comes to hiring, don’t just fall for the shiny resume. In my experience, the best indicator of success for a VP of sales (or for any hire, for that matter), is their attitude towards the company and the job. They have to respect the company and the opportunity, and look forward to the challenge. Remember that sales is a transference of feeling. If the candidate does not respect the company, they cannot sell effectively and will fail, and even their prior contacts will not convert. Always hire character and attitude, superior attitude will always trump superior skills.
While you are waiting for the right person, you can start with hiring a sales manager and sales support team. A founder should manage sales till a good candidate can be found. Develop the team, take help from advisors on sales management, and continue to scale. This reduces your risk of hiring the wrong person at a huge salary and regretting it later.
Lastly, seek help. Seek referrals, a referred candidate is far more likely to succeed than a headhunted candidate. If this is your first time hiring someone for an executive position, get help from advisors and mentors. Salesmen are supposed to be good at selling and that includes selling themselves. So, be wary. Take your time. Do not compromise on character and attitude and you will generally build a strong company.