SALES 101 FOR YOUR START-UPMark I LaRosa

THINGS TO CONSIDER

Who do you sell to? (sniper or shotgun) Do you market or sell? (both) When do you hire someone to focus on

revenue? Who do you hire? Blue Jeans or Grey Hair

DIFFERENT TYPES OF SALES / SALESPEOPLE

Type of customer and product drives type(s) of sales functions needed:MarketingBusiness Development Inside Sales / Tele-sales Outside Sales Account managers Hunters vs Farmers

PIPELINE

Deals currently being worked in various stages

More calls = more leads = more sales

PR is best (driving inbound) = qualified leads

Outsourced lead-generation Hourly / Success-based

SELLING VALUE OVER FUNCTION

RESIST DEMOS

EMBRACE THE WORD “NO”

Ask for the sale No gives the chance to ask why? No can mean:

Not nowNot in that wayNot at that price

NEGOTIATION

If I… will you…. Good Cop – Bad Cop End of quarter pushes

YOU NEVER CALL ANYMORE

Use the phones….

SEO is great, but nothing beats personal contact.

Don’t expect your prospects to do the hard work

MANAGING SALES PEOPLE

Manage to metrics Ultimately expect results Let comp plan do the heavy lifting Press on accelerating the close

Flush out deals that are not realDon’t let salespeople trend to the easier

conversations

Great salespeople are easier to manager

COMPENSATION TERMS AND BASICS

Base Commissions Draw

Recoverable / Non-recoverable Bonus Quota / Accelerator SPIF (Sales Promotion Incentive Fund) OTE (On Target Earnings) Up-side: DO NOT CAP!

YOUR BIGGEST CAPITAL EXPENSE

• Finding great salespeople is biggest bottleneck for a growing company

• Failed salespeople are the biggest waste of capital

• Right sales team = life or death

• Don’t Scale until you know your head from your feet• Never more than double any sales force

•

FINDING GOOD PEOPLE

•55% of sales professionals are in the wrong occupation1

•Sales professionals that are job-matched outperform their counterparts by 40% and are twice as likely to stick2

•Try all angles: recruiters, job boards, recommendations

1. Croner, Christopher and Richard Abraham, Never Hire a Bad Salesperson Again, Inner Workings LLC, 2006.

2. Greenberg, Herbert and Jeanne, ”Job Matching for Better Sales Performance,” Harvard Business Review no.80505

20%

25%

55%C PlayersShould not be in sales at all

A PlayersTop PerformersAccount for 80% of Sales

B PlayersShould be selling elsewhere

WHAT TO LOOK FOR

• Expensive Hobbies

• Confidence

• Ability to listen and answer questions directly

• Grasp general ideas around your product quickly

• Creative thinking on new ways to pitch your product

• Construct a pitch on the fly…