Growth5 Blog

Wednesday, August 26, 2009

Building Your Startup Sales Team

Dharmesh Shah of OnStartups.com posted this excellent piece on building a startup sales team. There are 14 points/paragraphs in the article, I encourage you to read them all. I have condensed them here:
1. Don’t hire sales people too early.

2. You don’t need sales people, you need sales.

3. Don’t hire several sales people at once. Figure out the type of sales people you need and who best to sell it to first.

4. The "Sales" type: not bad people, they’re just different. Be prepared.

5. Keep compensation plans simple.

6. Iterate! Refine your demo script, your slides, and any other collateral information. Use what you learn.

7. Sales people's behavior is often based on their incentives.

8. ALWAYS connect incentives somehow to ultimate customer happiness.

9. Make sure you understand the economics of your business. Figure out your total COCA (Cost of Customer Acquisition).

10. Your LTV (life-time-value: how much revenue you expect to generate per customer) should be higher than your COCA.

11. Track data maniacally.

12. Your pricing should be in line with your sales structure.

13. Once you get beyond three or so people, start looking at CRM systems (like Salesforce.com).

14. Start watching the shape of your “funnel” as early as possible. How many leads are you getting a month? How many turn into opportunities? How many of those convert into paying customers?

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