The Non-Negotiable When Building Your First Sales Team
Hey Friends,
Last week, I took a moment to reflect on a significant milestone for my business: I issued 99 invoices.
What stands out is that 50 of these were from new clients, meaning I've helped build and rebuild 50 sales teams in just under 18 months. Crazy, right?
But I'm not here to brag about numbers. If you know me, you know I'm more interested in inputs than outputs.
Instead, I want to share some insights I've gathered during this journey, particularly the common mistakes and similarities I've observed.
Most importantly, I want to discuss the non-negotiables when building your first sales team.
So, what are the main pillars you cannot miss?
After much thought, I've broken it down into:
Process
Financial
People.
1. Process
CRM:
You need a CRM system. HubSpot is a great choice (and no, I'm not sponsored by them).
Starting with their free account is a good move.
A CRM is crucial for tracking deals, MQLs (marketing qualified leads), closed losses, and everything in between.
Sales Cycle:
New Business: Regulates sourcing, engaging, and acquiring new clients.
Existing Business: Manages the entire existing business process, from onboarding to renewal and upsell.
Contracts & Payments:
Your contracts should clearly state two things:
Payment is due when the contract is countersigned.
Services and solutions must be prepaid for at least one year. There are no way-outs or strange variables.
The main ARR of your startup should come from prepaid customers.
2. Financials
Each sales rep you hire should be paid fairly and according to market conditions.
Additionally, set a goal for them: their Year 1 target should be at least 3X their total cost (salary, bonus, taxes).
If customers don't pay within three months of signing, you can reclaim the money from the sales rep who closed the deal. This clause, called a clawback clause, is standard in B2B tech sales teams.
3. People
This is the most crucial part, and I’ve saved it for last to ensure your full attention.
Hiring Process:
Implement a structured hiring process for your early-stage startups, including screening, chronological interviews, role plays, and motivational interviews.
Firing:
Fire fast. If there's no fit after 3-6 months and the person isn't coachable, let them go.
Promoting:
Create a system for promotions and pay raises.
Coaching:
Build a coaching culture. Provide feedback on calls, conduct role plays, and focus on your team's development from the beginning.
Management:
Manage your team effectively. If you're unsure how to do this, consider hiring a fractional sales leader. Whether you have 1-2 people or 10, management is crucial.
Summary
Regardless of your size, if you're building your first sales team, you must do it right from the start.
You can't miss the non-negotiables.
The good news is that there's not much left to do after setting up these foundations.
You'll have a solid starting guide for your very first sales team, and if done correctly, you should start seeing your pipeline grow.
Thanks for reading this far. See you all next week!
