Tuesday, July 03, 2007

Sales Process

In the early days of a startup the word "process" does not present itself, except in the occasional meeting where someone on the team feels like they are drowning and need more structure. It is all in the doing. Sales in particular feels fairly process free to start with (from the CTO's point of view, so take it for what it's worth) and is almost strictly opportunistic. Don't get me wrong, there is a strategy, but what process there is, is fairly loose.

The methodology goes something like this: call friends and acquaintances to ask for "feedback" on the product. These are either truly prospects or fishing expeditions. Most people want to help and will at least give you feedback, or will point you to someone who might actually care about your product, or in the 1% case be a great fit for your current product and move forward with you. You work closely with the 1%, incorporating the features they're asking for that make sense to the core direction (or change the core direction), ask for money, and close a few early adopter deals.

Later as the product and strategy mature, process must be introduced to make selling repeatable and scalable.

Making it repeatable means that you've found a message that resonates with a customer domain, you know how to reach the people in the domain, you can identify 1) the sponsor in an account, 2) the gatekeepers in an account, 3) the buyer in an account. Further, you know how the budget process and cycles work within the customer domain, and the product packaging and pricing make it easy to sell into the budget process. Most of this is intuitive for great sales people and it is amazing to watch them orchestrate this process, translating it into a consistent revenue stream for the company. Great sales people are also few and far between. If you find one, hold onto them.

Making sales scalable means that the cost of sales is not too high. This comes down to about three things in my opinion (and remember I'm the CTO ;)
  1. Sales cycle is not too long. If you're only hunting elephants it will take a long time to get revenue in the door, the customer feedback will be sparse and may take the company in a direction that prevents the first sales process tenet of repeatability.
  2. Doesn't require too much setup and configuration time that the customer doesn't value (i.e. doesn't pay you for)
  3. Doesn't require custom development work
So, when you're getting started, run fast and loose, but when you see the signs of the startup project transforming into a product start instituting the process. And be sure to recognize whether you have these process skills or not. If you're not the person, then go out and find someone you can work with, that is passionate about the product, and has the skill set and proven track record to go knock it down.

1 comment:

Ben said...

Excellent post. I couldn't agree more. Hope all's well Tim.

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