This article is reposted from the new "Ask the Angels Blog" from the Pasadena Angels. The Pasadena Angels--an active and helpful angel group here in the LA area--recently launched its blog site at www.asktheangelsblog.com to help local entrepreneurs. The site covers a wide range of topics on start-up companies and fundraising.
Every startup faces the question of who to hire for their first sales position. Do you look for that fantastic VP of sales who is not only a great closer, but also a master strategist? Do you hire that friend of the founder who is young but promising? How do you decide?
Start by considering what you really need. Most startups have several specific needs that your first sales hire must fulfill. Hiring a salesperson is no different than building a piece of technology. Your management team should agree on a specification for the position, and then hire to that spec. Otherwise, you risk “falling in love” with candidates that may or may not bring the skills your company needs.
The likely list of needs:
1. Sales Momentum
Every startup simply needs to begin making sales. Look for someone who has sold a similar product successfully in your space, and who has some small company/unit experience. Dropping a successful corporate salesman into a startup can be a disaster. You need someone who shows evidence of self-sufficiency, not a prima donna. Have they pioneered a new geographic market or launched a new product? Started a new department? Look for the clues. Ask your candidates to cite examples of creating momentum in their past jobs.
2. Raw Sales Talent
Don’t trust resumes—make the candidate demonstrate their sales technique. The best interview “test” I was ever given was being asked to formally present my tentative sales strategy to the entire management team of a startup. I stood up with my PowerPoint presentation, pitched it to the management team, and then took questions on why I choose that approach. That management team got a thorough demonstration of my abilities to make enterprise sales.
Ask your candidate to give you a sales pitch—either for their current product or a rough version of the pitch they’d use for your product.
3. Market Intelligence
Your first sales hire is going to bring back critical market feedback on your product as he sells. The right salesperson will be a very important member of your product development team.
Check their abilities by talking to past or current clients. Does he/she listen well? Can the client describe a situation where the salesperson went “above and beyond” to make their product really work for the client? Talk to at least 2 clients and find out.
4. Process Building
Your first sales hire is going to build version 1.0 of your sales process. They will develop the sales message, build pipeline tracking and forecasting, and lay the foundation for scaling up the sales team as you grow.
The right candidate will be able to show you examples of how they have done each of these tasks in the past. Can they give you a crisp “elevator pitch” for their current product? How accurate has their pipeline reporting been in the past? Look for examples.
The overarching message is this—hiring a sales candidate is no different than building your product. Build a spec, and hire to that spec. Don’t be afraid to test your candidates—have them do presentations, talk to clients, find out why they win and lose accounts. Don’t become obsessed with finding the (probably mythical) perfect VP that you will keep on the team for all time. Just find someone who can get the job done right now.
Parting thought—“Hiring with Your Head” by Lou Adler will help you formulate your thoughts. You can find it at Amazon.
Steve Reich is a member of the Pasadena Angels and the VP Sales for LeisureLink (a Pasadena Angels portfolio company). His career includes executive positions at both public and private technology companies. Steve has particular expertise in sales, marketing, and financial management.
Steve managed sales and marketing at both Digital Insight (DGIN) and Treasury Services Corporation. Digital Insight went public in 1999, and dominates the Internet Banking space. Treasury Services focused on bank profitability and risk management, and was sold to Oracle in 1997. Prior to these positions, Steve was a consultant in the banking arena.
Steve holds an MBA from Claremont Graduate University, and a BS in Business Administration from Arizona State University.