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RECON REPORT

Why it is completely asinine to join as sales rep #1

by | Apr 10, 2016 | Uncategorized |

Why it is completely asinine to join as sales rep #1 : DEFCON 1

Sales Wound #143

The 2nd most common question I get asked on a weekly basis is, “Should I join a startup?”

If you’re hellbent on getting startup experience (aka joining “the $hitshow,”) hopefully it’s because you want to start your own company one day. Otherwise, stay where you are. Here are the dimensions I would use myself to evaluate the level of “$hitshow” : DEFCON 1– 5

As a baseline, let’s assume the team is strong technically and can ship code on a regular basis.

DEFCON 1:

The founders have never closed an annual contract before in their career.Eject now.

Why? Closing/Shipping Revenue is just like shipping code. It’s binary, you’ve either done it or you haven’t. If you have never worked with a customer to get them to sign a piece of paper that commits them to working with you for 12 months, then I cannot begin explain how hard this is to do. It’s like explaining to your grandma what it takes to push code to Prod.

Why Annual?

Closing an Opportunity for $10k/mo on a month2month contract where the customer can leave immediately is a 3/10 on the difficulty scale.

Closing an Opportunity for $2k/mo for a committed, “no-outs” 12 month term is a 9/10 on the difficulty scale.

It’s not about the deal size, it’s about the time of commitment. In order to sell an annual contract at any ARR you have to sell deeper into the psychology of the buyer and higher in the org chart.


DEFCON 2:

Founders “say” they understand the value of engaging with customers as an Enterprise partner. You really like their solution and you see the market opportunity.

If that’s the case then let’s experiment.

The first thing I strongly suggest founders do is to go get a contract signed. Size of the contract isn’t important. Length of the contract (12 mo) though is an absolute requirement. Only then, will you understand 20% of what it takes to be a sales pro. But you’ll have learned the single most important thing, CONTEXT.

You can work with the founders to help them qualify leads / pitch prospects / position product / close opportunities but do NOT do it for them. You’re in the background coaching them and you don’t have to be 100% on the team yet.

Typically after a founder closes the first annual contract, unassisted, the lightbulb goes off. They are beginning to learn and understand why sales is just as important as Engineering. Ship Code : Ship Revenue.


DEFCON 3:

Founders have closed an annual contract. The larger the committed ACV = less risky.

But you’ll be the first sales rep hire. Roll the dice.

I’d always bet on the founders + team. If you feel you align well with them in your mindset, motivation and teamwork style then go for it. You’ll know within the first 30 days if you’ve been oversold OR you’ve oversold your skills.


DEFCON 4:

Founders have closed an annual contract: AND

  • There is at least 1 AE on the team

Even better as you can assess the level of experimentation the 1st AE has done. This is just an accelerator to figuring out phase 1. It’s not about how much commission the AE is making but whether the AE can close and how much assistance they need from the team. It’s ok if the founder is still on every call in the “Presales Engineer” role but that will give you a sense of how independent the AE can be based on where the product + customer fit is. getting closer to the first mini phase of repeatability.


DEFCON 5:

Founders have closed an annual contract AND

  • The founders have enterprise sales experience + exceptional engineering
  • Engineering has had 12+ months working with real customer issues

Do whatever it takes to get onboard asap. If that means taking $0 to just get on the team to prove yourself, then do it. In 30 days they’ll be screaming to get you officially on the payroll.

SHIP CODE : SHIP REVENUE

git push : closed won


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