The disparities in popular advice for pre-chasm (vs. post-product-market-fit) businesses is often discussed, including how to separate signal from noise and the necessity of product marketing while establishing a category.
But how can organisations get from “searching” for product-market fit to actually scaling a sales organisation around a repeatable sales process in pre-chasm markets? Beyond the basic mechanics, what mindsets can founders use to frame, navigate, and avoid the common pitfalls of building the process in their businesses?
Going from product to sales — specifically, a repeatable sales process — is maybe the single most difficult early issue for startups in early markets. Occasionally, a product draws the market in such a way that the company is inundated with inbound inquiries; nevertheless, these instances are extremely rare, and they come with the erroneous belief that bottom-up adoption eliminates the need for sales. However, in the great majority of situations, a product launched in a developing market lands with a dull thud, leaving the corporation to find out how to sell it.
The word “sales” has the (often unpleasant) meaning of persuading someone to purchase something they may or may not require. As a result, early company founders favour very “salesy” early sales personnel, because who could resist such charisma?
However, selling a product isn’t about persuading someone to buy it. It’s not even about selling to clients who believe in the concept and are willing to pay for it. In early markets, selling should be focused on identifying the few suitable customers who want it strongly enough to cooperate with a startup, put an unproven product into production, and suffer the inevitable glitches along the road. This translates to customers that are strategically aligned with the company’s and product’s visions.
Because it’s such a complicated topic — involving the company’s ethos, the technical landscape the product will enter, the product’s technical underpinnings, and the industry’s strategic position and vision — the only people who can do it justice in the early days are the company founders or early executives.
This attitude toward sales is critical for early-stage companies. Because sales is so important in evaluating whether or not you have product-market fit, it should be closely involved in the product development, release, and feedback cycles.
The first sales rep doesn’t actually sell
One of my rules of thumb is that founders and/or early company leaders must be able to market the product. Even if they can’t negotiate a price or manage the procurement procedure, if they’re given the correct access and still can’t persuade the customer, I’d look at the product, the market, and the customer again.
A smart “first sales rep” will reverse engineer the organisation structure, uncover strategic projects that connect with the product, and sniff out budgets and champions within the account to get you in front of the correct person. They’ll even assist with price negotiations and procurement. But they don’t usually “sell” — that’s the duty of the founder.
However, early market reps do not need to be technical; instead, they should be able to do the following:
- qualify customers and deals (determining whether there is a real opportunity or not)
- negotiate with customers and deals (determining whether there is a real opportunity or not);
- negotiate with customers and deals (determining whether there is a real opportunity or not)
- bringing in reinforcements (startup founders, product managers, etc.) at the right time
- navigating procurement and pricing.
What’s the difference between a new salesperson and a seasoned salesperson? By exploiting existing ties, a mature market salesperson can often close a contract. However, given your limited resources, the last thing you want to do is sell to a buyer who doesn’t appreciate what you have.
Not only will they eventually churn out, but you’ve also given yourself false market signals. As a pre-chasm startup, “buying” your way into a client base is risky because you don’t always know who your initial consumer set will be.
Sales engineers sell
Recruiting a sales engineer per sales rep in addition to early reps with the qualifications listed above is advisable.
When developing an organisation, this is one of the most common ways to scale out the technical founders. You may not need a 1:1 mapping of sales engineer (SE) to account executives for non-technical products and particularly popular open-source products (nor should you hire the same profile as a direct sales person).
However, in early sales, some have a tendency to over-invest in SEs, then gradually reduce the ratio per sales person.
So, what exactly is a sales engineer’s job description? While an account representative is in charge of “quarterbacking” the sale and has a lot of knowledge, the technical founder does not (procurement, negotiation, discounting), The SE is explicitly in charge of bringing an account to “technical close.” This indicates that they are the ones who are actually selling.
Sales enablement is as important as sales itself
Make sure you have a strong product marketer after you’ve employed your first few sales reps and engineers. Why? Because product marketers are in charge of sales enablement, or providing material to salespeople to assist them sell.
The “pitch,” or basic rationale for why your product is the correct one and why now is the appropriate moment to acquire it, will usually come from the founders and will be improved over hundreds of meetings (with the account reps and SEs).
However, all of this is tacit, implicit information that is useless for growing a sales process. That’s where product marketing comes in: it’s the department in charge of whittling down the voluminous debate into straightforward, repeatable messaging.
The earlier a product marketer is brought into the conversation, the more context they’ll have when it comes to creating the positioning — and sales collateral — that is the primary means of controlling your sales teams’ conversations and ensuring everyone is selling the same thing to the right people.
Having others do the selling for you — or recruiting more salespeople early on — is rarely the answer to a lack of sales. However, don’t expect more or a different sales lead to compensate for a lack of product-market fit. It’s all about striking the proper balance in early markets. Using incremental sales as both a tool for driving into the market and a measure of how solid the fit is. 7startup can help you find the right balance.