Sales solves everything is an old expression I’ve heard since I was a kid and I have to say that I fundamentally agree with it. You really can bail yourself out of myriad business problems by simply selling more and therefore increasing top-line revenue. Like many founders who do their own sales, I’ve tried to hire Sales Reps several times and have had varying degrees of failure in making those reps productive to anywhere near a level that I myself can close. In other words, Sales Rep is the position that I simply can’t hire for effectively.
Sales is ultimately about cold hard cash and as a startup (especially a bootstrapped one) funding the normal near six figure base of an enterprise Sales Rep in addition to a standard 5-10% commission on closings, can be a tough pill to swallow. Like many founders in this position, I’ve opted to cut that base down to something more sustainable and target commission rates at the top end or even beyond that 10% range; at one point, I even tried to go with very high commission rates and no bases but that turned out to be a total disaster in that it forced my rep to basically close any deal — do not employ 100% commission reps. Unfortunately, Sales Reps are like everyone else with financial responsibilities and tend to be pretty attracted to larger base salaries (at least that’s been my experience in the software space) and that creates a situation where smaller shops are often not the first choice of the most capable or accomplished reps.
Cash aside, the other issue tends to be domain / market knowledge and training budgets and processes. Basically, given the pool of reps that are available to small firms, there’s a higher than even chance that their reps will tend to be on the more junior side of the experience and therefore have less product knowledge than their more senior counterparts. The founder of the small firm is then forced into a position of either investing heavily in training up an asset that may not pay off or worse may go to the competition once they’ve gained enough product / market knowledge to command a higher base or simply treat their reps as replaceable cogs, hiring many low-paid reps, offering little to no training, and dismissing all but the highest performing reps. If you’ve ever worked in insurance or know someone who has the latter will sounds very familiar to you and likely leaves a bad taste in your month. Compounding the issue of investing in more junior reps is the fact that the founder himself if likely to have far better numbers in terms of raw closings and terms, making him increasingly (and from a purely numbers perspective correctly) reluctant to invest in training.
Sales solves everything. That’s why I’m doing my own sales from now on. Are you a founder? What has your experience been in hiring Sales Reps? Did it work out? Are you still doing your own sales?
