When you’re just starting out as a SaaS founder, how to hire SaaS salesperson is one of the most important decisions that will be made.
Getting it right the first time will save you a lot of trouble in the long run. Get it wrong and there’s no telling how much money, time, or energy that’ll be wasted.
I’ve founded a bunch of SaaS startups, so I know what it takes to make this work. Here are the three things you need:
1) Competitive base pay and commissions;
2) A culture that rewards success and failure equally;
3) Clear career paths.
When Is the Best Time to Hire SaaS Salesperson?
One of the most important decisions for any startup is who will be their first salesperson.
If you want to be successful in sales, it’s important that you get a hands-on approach. This way, you can learn about the customer and how they work for you.
I also like to provide a basic sales process and tracking, so the new hire can start at their own pace.
When you start to see traction and have enough of a process in place that can be tweaked, it’s time to hire someone.
What Challenges Do You Face When You Hire SaaS Salesperson?
It’s not easy to hire your first salesperson. There are a lot of things you need to consider, such as:
- Your not a salesperson: As a sales manager, you may not have the experience of being in your employee’s shoes. That’s why it is important to create an efficient workflow for them.
- Your misconceptions: Entrepreneurs are always thinking of new ways to sell their products. Chances are, you have a lot of ideas about how it should be sold and what will work best for your company. But they might not be the right way.
- Unrealistic expectations: YRamping up is important. If you’re not careful, unrealistic goals can create a lot of tension and pressure.
- Poor leads, not enough of them: To keep your salesperson motivated, you need to be producing a decent number of leads (inbound) – say around 50 qualified leads per month.
- Hiring costs: When a startup first starts out, the salesperson is typically one of the highest-paid employees. This puts pressure on both parties to get it right.
- Needing more experience: When you hire a cold caller, they need to be able to do more than just call and ask for an appointment. They also have to take on the responsibilities of prospecting, qualification, and demoing your product.
Should you hire two representatives rather than one?
The conventional wisdom is to multiple reps, as opposed to only one. The idea is that they can learn from each other and you can pit them against each other, which will result in the most motivation for both.
I agree with this advice to a point. But what if you don’t have enough budget or leads for two reps?
I’ve found that this is true at all my companies, and in most cases, it’s been successful. I would say two-thirds of the time our first hire was a success.
Don’t worry if you can’t afford to hire two reps right now. It will be better for your company in the long run.
If no other reps are hired, there is nothing for them to compare against.
So in order to get a feel for the motivation of your new hires, I recommend starting out by doing their job yourself. That way you can see how they’re motivated and what gets them going.
Entrepreneurs, it’s likely that you suck at sales. Even if not, there are a lot of things to take into consideration before going head-to-head with your competition.
If your sales reps are not outselling you, there is something wrong with the way they’re being motivated.
You should always have a backup plan for when things don’t work out with your first hire.
Having a backup plan is essential because if the first person doesn’t work out, you can quickly bring in someone else.
5 Tips to Hire SaaS Salesperson
After laying the groundwork and developing basic processes, you’re now in a position to make that crucial hire.
To avoid making the same mistakes I did, here are five things to keep in mind when designing your sales compensation plan.
1. Passion takes precedence over reputation.
With your first hire, you don’t want them to be terrible at sales.
It’s important to remember that they don’t need a perfect resume, and you should always keep an open mind when interviewing candidates.
It’s more likely that you’ll succeed if you hire someone who has the product knowledge and is committed to what they’re selling.
The fact is, if they don’t believe in your business from the beginning and are just there for a paycheck, then it will be difficult to get them motivated.
Furthermore, I’ve noticed that top-performing salespeople usually have a team and marketing resources to rely on. These things don’t exist at startups where they’re expected to create their own strategy
2. It is critical to tell stories.
If you have followed my advice and been your own salesperson for the past 30-90 days, then you should already know what type of messaging has had the most impact on customers.
You should hire a salesperson who can take your initial findings and come up with something even more impactful.
What are the characteristics of a successful salesperson?
Justin Welsh advises giving all salespeople a little information about the product and the profile of customers. He then asks them to craft compelling narratives that will compel prospects to learn more.
He usually gives them 24 hours to prepare and then, as a role-playing exercise, they’ll go through the results together.
If they don’t, then it’s time for them to find another job.
3. Invest in a Doer
You need a team player who is able to step outside of their job description and take on different tasks as needed. They might be asked to write an ad, edit together testimonials or speak at business meetings.
It’s a cliche, but people need to have an entrepreneurial spirit in order to thrive at startups. You don’t have the time for micromanaging them day-to-day so you can’t afford their inaction.
4. Be honest with yourself.
Ambition is an important part of any business. You should be ambitious in order to succeed.
You need to be realistic about your sales targets. You can’t expect a new hire to generate enough revenue in the first 90 days of employment, but they will eventually reach an acceptable level.
Give your new salesperson three months to prove themselves. You don’t want to risk losing them if they are a great fit for the company, just because you set their goals too high.
5. Remember why you hire SaaS salesperson in the first place.
We’ve already mentioned the importance of having a salesperson who is willing to do anything.
It’s important to remember that you hired them because they are salespeople. They should be focusing on selling your product.
One of the biggest mistakes that sales managers make is not providing adequate support for their reps. As soon as they start getting bogged down in qualifying leads and building up collateral, it’s time to get them some help whether this is a marketing executive or an account exec.