Tips for Founders on How to Build Sales Teams for Startups.

Tips for Building Successful Startup Sales Teams

If you’re running a startup, you know how crucial it is to build a customer base to generate revenue and sustain your business. One of the most important elements of a successful customer acquisition strategy is building a robust sales team. However, building a sales team can be a daunting task- especially when you have no experience in sales. In this article, we provide some essential tips for building a successful startup sales team.

Don’t Hire Sales People Too Early

In the early stages of a startup, founders are often responsible for generating sales. It’s best to keep it that way for a while. Your first hire should not be a sales person; instead, it should be someone with a marketing background that can help you build your brand and attract potential customers.

You Don’t Need Sales People, You Need Sales

At the startup stage, you should hire someone who can generate revenue, not someone with only a fancy title. Hiring a VP of sales or a sales manager is not necessary as your first hire. What you need is someone who can generate revenue and close deals.

Don’t Hire Several Sales People At Once

In the early stages of a startup, the founders should aim to figure out what kind of people are best suited to make sales based on what they are selling and who they are selling to. It’s best to take a phased approach, hiring one salesperson at a time to test the waters and see what works for your business.

Be Prepared for a Shock to the System

Salespeople are different, and if you’ve never worked with them before, you may be in for a bit of a shock to the system. They’re not bad people; they’re just different, especially if you’re used to working with engineers. Therefore, be patient and maintain a positive attitude when working with salespeople.

Don’t Create Complicated Compensation Plans

It’s best to keep things simple when it comes to compensation. Complicated commissions plans are not necessary in the early stages of building your startup sales team. Start with a simple salary or commission structure and adjust it as you grow your team.

Agile Methodologies Work in Sales

Agile methodologies are not just for software development; they can also work very well for sales teams. Keep refining your demo script, slides, and any other information you use to pitch to clients. Capture the best practices from your top-performing salespeople and spread them across your team.

Connect Incentives to Customer Happiness and Success

Incentives drive behavior, so make sure you connect your sales team’s incentives to customer happiness and success. This will ensure that your sales team focuses on closing deals with customers who are likely to be happy and successful with your product.

Understand the Economics of Your Business

To understand the profitability of your sales efforts, you need to calculate the cost of customer acquisition (COCA). It includes the salaries of the salespeople and marketing team members and all marketing campaigns. Your lifetime value (LTV), which is the revenue you expect to generate per customer, should be greater than your COCA. Make sure you’re spending your marketing and sales dollars in ways that make sense for your business.

Track Data Maniacally

As you grow your sales team, you need to track data meticulously to understand what works and what doesn’t. Keep records of what was sold, who sold it, and for how much. This data will be invaluable as you scale your team and begin to analyze more complex patterns.

Pricing Should be in Line with Sales Structure

Your pricing should be in line with your sales structure. You can’t have an outside sales team if your average deal size is low, nor can you have an inside sales team if your average price point is too low. Make sure the math works in your favor.

Invest in a CRM System

As your sales team gets bigger, you will need a more efficient way to manage your sales data. A CRM system like HubSpot CRM is an excellent tool to manage your sales data and is free to use.

Watch Your Funnel

Keep an eye on your “funnel” and figure out your flywheel. Monitor the number of leads you’re getting and the number that turns into opportunities.  Then, monitor how many of those turn into paying customers and how many of those customers become advocates for your brand. By understanding your flywheel, you can focus on improving areas of your sales process that need attention.

In conclusion, building a successful startup sales team takes time and effort. By following the tips we provided in this article, you’ll be well on your way to building a team that is focused on generating revenue and boosting your startup’s growth.