I see lots of job openings in sales within seed-stage companies, and my experience working with them suggests it results from widespread confusion among early-stage founders.
In a nutshell, most founders think that if a product is ready to be sold, the company needs salespeople.
Why do I think it is wrong?
Because:
- it is typically a founder’s job to close the first deals,
- before you ensure the offering is well met among the clearly outlined target audience, it is not a sales job, it is a product one.
Let’s dive into the details.
1. Founders should not hire anyone to close first deals
If you have a tech company and tech expertise is outsourced – this is commonly perceived in the industry as a major threat to the company.
The same relates to product expertise.
Product traction defines everything in the company, strategic and tactic – thus having even employees overseeing it is unacceptable.
2. First deals do not mean product-market fit
There is no universal definition of product-market fit (PMF).
One defines PMF like porn: ‘You can’t outline its boundaries clearly, but when you have it, you know it.’
And I think it is harmful because many founders assume they have PMF when in reality they don’t.
As the first deals are founders-led, to sign them they can leverage their network or personal brand – but these deals are about founder-market fit.
For PMF, the market’s interest should be confirmed by multiple deals with no personal connection between buyers and sellers.
Enter (in)famous Startup Death Valley, where every company has to find its niche before running out of resources.
3. Sales Product job
In Death Valley, you should set hypotheses about the messaging/USP, the audience, in some cases also the channel to attract this audience and test it.
If your salespeople are good and comfortable in it – good for you!
Because typically sales job before product-market fit is frustrating, and this is why a sales community Bravado helps filter out opportunities in unproven verticals or with unproven products.
The reason for frustration is not only that deals (and bonuses) are rare at this stage.
It is also founders’ expectations and perceptions.
I mean, if a product person set several realistic hypotheses and none of them proved itself – that’s OK, startups are hard!
But framing like ‘a salesperson failed to make a single sale in months’ leads to the conclusion that her unprofessionalism ruins the company because the company counted on sales which never happened.
Do you see the difference?
The latter approach is a lose-lose game, and it is the founders’ fault if they framed reaching product-market fit this way.
You can be lucky to find a versatile person who is good in both HADI cycles and in reaching out & talking to strangers.
But you shouldn’t expect many deals at this stage.
And thus if you decide to bonus your rep for a successful discovery – it should be minor compared to the basic compensation.