Streamline your sales cycle for sport organisations

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now that I have a go to market model and I've kind of internalized how I'm going to market with my product what are the steps to Bill actually building out a sales organization like who do I hire when do I hire that person what are some of the approaches to going from small to large the first part of building out a sales organization is understanding the sales learning curve it takes time for an organization to understand how to sell its product just like it takes time to build a product it takes time to understand how a customer buys and the productivity of a sales person and the overall organization and that's what the sales learning curve depicts when this axis is the yield and over here is time and the sales learning curve looks like this and it's divided into three phases this is called the initiation phase this is called the transition phase and this is called the execution phase and every company wants to try to get to the execution phase as quickly as possible this is when we have what's called a repeatable sales model a repeatable sales model means that I can hire a sales person hire another sales person hire another hire another and I will know exactly the yield of that sales person on a repeatable basis so if I hire a person and cost $200,000 a year I'll know how quickly that person can ramp and how much money that sales person will bring into the organization in the initiation phase I don't know any of that we don't know how long it takes a sales person to ramp we don't know how much money a sales person can bring into the company we don't even know if our product can be sold so how do we think about now hiring for these different phases because they're very different in terms of in the life cycle of a company the type of sales person that one brings in is actually very very different so we think about the initiation phase as hiring what I would call a Renaissance rep the person probably is technical they're used to being really a one-person band there's probably no sales engineer there's no marketing department there's really nothing and so we have to think about this person as kind of a lone wolf out there trying to drum up business for the organization you're not going to find the Renaissance rep coming out of a large organization how do I know when I'm not in the initiation phase anymore and I'm in the transition phase or in the execution phase let's say you have two to three sales people who are Renaissance people I will move from this phase to this phase when the two to three sales people on average generate one times their fully loaded costs when a sales person can generate the same amount of money that they are costing we move from this phase to the transition phase and we get into execution phase when this is three times the loaded cost now y3x well a sales person and sales organization not only has to cover their own costs but a sales organization has to cover the revenue for the entire organization now a very productive company is probably 5x the cost of and this is a fully-loaded so when we think about quotas and we think about commission rates typically you want to be anywhere from three to five X in this phase here and only when you get there are you able to think about a repeatable sales model here's where I can start to get the people who have been at larger organizations once you have the marketing support the sales engineering support and all of the underlying pieces that these folks are familiar with then we can start bringing in people which are or I would say coin operate it and in the same way that you wouldn't hire a coin operated salesperson to be in Faye's I probably wouldn't hire a startup person to be in this phase because that person is going to say boy this sales organization too bureaucratic for me there's too many rules I don't can only sell in one zip code why not well those enterprise reps have all the marketing support have all the sales engineering support have dedicated territories people coming out of large environments are very used to having a lot of resources at their disposal those people will not work well here even if they have crushed their number at the previous organization it's a mismatch for where you are and skills of that particular person and so the constraints over here which actually is the definition of sale of repeatable sales process probably doesn't work for the person here so when you're hiring think about where you are in this process and think about how I might go apply those exact resources to where I am in terms of my company's life cycle you as CEO kind of working with the salespeople in this phase will give you an appreciation for what salespeople face I'll give you appreciation what the customers saying it will also give you enough knowledge to go hire a VP of Sales in this particular phase because you'll understand kind of the issues that your sales organization is dealing with now if this is a different type of person what do I deal with all these great people who start it out like here's a person who risks coming to the company and they're you know two or three of these core people and they help to build the whole sales organization so how do I think about using these people probably by the time we get here we're gonna want to open up new geographies maybe have new products that we're starting to build these people are phenomenal at going and doing that because these folks know how to do these things without any formal resources obviously we want to try to keep them through the whole cycle because they know a tremendous amount about our company