How quickly should you hire salespeople in a SaaS company? #Q&A

By Zeeva Viola | March 30, 2017

Question:

The faster you hire the quicker you can grow your revenue (in theory). However, it can be a danger to hire too quickly. Any rules of thumb here?

Answer:

As soon as you have a repeatable sales process, defined as:

• Your lead sources and best prospecting activities are clear and measurable.
• Your Customer Segments within your target industries and verticals.
• Buyer Types involved with the review and purchase of your product.
• Awareness of buying signals and milestones achieved during the sales process by your prospects.
• The time to sale from initial contact to lead/prospect and receipt of first $ of revenue
• A Customer Implementation plan – one the client decides to begin using your SaaS product, there is a clear plan for the first day, week, month, quarter, and year on how that customer will be happy and successful forever.
• A six-month sales commission/compensation plan.

This might mean that you need hundreds of customers or just a few – it all depends on your product and speed to developing this repeatable process. Remember, if you are hiring a salesperson, you expect that person to spend as close to 100% of their time selling.

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Personal Example: I was the first non-founder to join Altos Research in July 2007. The company founder/CEO spent 2006 developing the first round of products and the first half of 2007 developing a customer base. When I walked in the first day, he had a clear sales plan:

1. “We get about 10 registrations/day from the website, mostly from organic Google search or blog posts. Call these people.”
2. “When you call them, ask them these three (3) questions…”
3. “When they answer Question #1 with [insert answer], then ask…”
4. “Then do a product demo.”
5. “Then ask for their credit card info.”
6. “If they need to see a sample report, email it to them and call them in a week. If they don’t buy a week later, move on.”
7. “Once they sign up, then do this right away…”

That was it. From there, I iterated the heck out of the process as the product grew, the team grew, and the market changed.

The CEO knew EXACTLY what it took to sell $79/month subscriptions because he’d sold ~75 of them himself sitting in a coffee shop calling people on his cell phone.

If you have your salesperson leading Customer Discovery calls, spending intensive amounts of time with your engineers developing the product, setting up email campaigns and writing blog posts, calling conference organizers for sponsorship packages, “figuring out the sales process,” defining your market segments, calling CRMs and screen-sharing software companies to evaluate their products, then you’re misusing your salesperson.

You may need someone to do all of these things, and if you do, then do not hire a salesperson.

**This Q&A article was originally posted on Quora. Check out Scott’s Quora page here.