This is the second post in this series. The first post is The Startup Founder’s Dilemma – How to scale sales? As stated in that post, before considering hiring your first Vice President of Sales (VPS) you would have hired 2-4 sales reps, began growing recurring revenue and the founder(s) would be acting as the head of sales.
Ultimately your first VPS will be able to drive more revenue per lead and scale the organization by implementing a strategy, a process, and a hiring and a training plan; but the main consideration here is: When is the right time to hire your first VPS? That depends on how you answer the questions below.
- Do you have a repeatable sales process?
- Do you know what your ideal profile and targets look like?
- Do you know why you’re winning and losing deals?
- Do you have movement with your deal flow from the top to bottom of the funnel?
- Do you have a clear value proposition that is distinguished from the competition?
- Is your product competitive?
- Is marketing ready to help ramp up sales?
Can you answer “yes” to all the questions above? If so, you are ready to hire your first VPS. With that said, I want to focus the rest of the post on the importance of the product and marketing. Hiring an experienced VPS without a strong product offering and a functioning marketing organization in a competitive market would be like starting Payton Manning with pee-wee receivers and running backs. Don’t expect your VPS to improve your product and execute a marketing strategy.
Are you winning deals because you have a superior product? Your product needs to be differentiated in the market you’re competing in. A great product can make up for weaknesses in both sales and marketing. However, if your product offering is average at best compared to your competition then you will most likely get average sales results. Great sales and marketing can close the gap but not enough to be a leader in your industry. Be honest about the current state of your product and if its underdeveloped then it may be too early to add your VPS. The VPS cannot make up for an inferior product.
There are two keys areas where marketing can help make an impact with early stage sales; 1) building brand awareness and 2) filling the funnel. As a startup when calling on prospects you will certainly hear “I’ve never heard of your company before”. Sales needs to be able to address this concern and the best way to do that is through customer references and thought leadership. Marketing can be a tremendous help in building the brand as an industry thought leader through content development i.e. webinars, case studies, white papers etc. Utilizing the content created, marketing can then create a demand generation program that will help drive inbound leads that can in turn shorten the sales cycle. Since outbound tends to take longer to close, getting some warn leads will help offset the outbound lead generation process. Again, don’t expect your VPS to execute a marketing strategy.
Most proven VPS will be able to get good results; but without the horsepower from a great product and strong marketing, they’ll struggle to get exceptional and consistent results.
2-4 sales reps + growing recurring revenues + “yes” to the questions above = hiring your first VPS
Now the hard part, finding the right person for the job. Check out this great post by Jason M. Lemkin on the different profiles of the VPS.
I would welcome your feedback and comments.
You can also find me @vincebeese and LinkedIn
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