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Q&A: Founder Sales

Vikrant Duggal
Vikrant Duggal
• 4 min read

Every fund has their areas of speciality. Mine happens to be helping early-stage founder with their 0->1 stage to develop product-market fit, and then their 1->2 stage to develop go-to-market fit.

A few weeks back when fellow On Deck Angels fellow asked if I would be of help to his portfolio I said yes. Yesterday I spoke on a panel he put together. His fund's area of expertise is in engineering, product, and design and they were specifically looking for someone who could help do some Q&A for their portfolio.

Here are some of the questions that were asked and the notes I had jotted for myself. I thought I would share them here.


Any advice for founders who also wear sales hats and how can they grow an early sales team effectively?

You have to know where you’re going and I advise all my clients to use some kind of operating model. This will help you see clearly that your business is a living/breathing thing and it needs attention. You’re going to need to figure out how many reps you need to hit the targets, how many marketing people you need, and if your marketing org is supplying enough demand to warrant the reps.

In the early days one of the founders is the VP, Sales. Bring on 2 reps (not one, maybe 3) and don’t plan on them being able to pay for themselves for 4-6 months. Once they can start to close ~5X their comp you’ll be on to something.

Hire the early sales rep type (not the "I only want to make money" type), unless you have it dialed in. This means people who like to sell, but also love the problem and the customer (a very product marketing mindset).

For B2B SaaS companies at the Series A stage ($5-10M round size), what’s the standard role breakdown of a sales team? i.e. 4 AEs, 2 BDRs, customer success? Etc.

Let’s start with marketing and sales and then we’ll discuss customer success separately, because customer success headcount is not tied directly to revenue, or customer count.

Here’s how I figure out the breakdown. If you’re at Series A - let’s assume you’ve not been pre-empted then you’re looking at going from $1m to $10m in ARR.

You know your revenue target ($10m in this example), but you need to understand your ACV - for smaller deals reps may have a hard time making good money. A logo acquisition framework can come in handy to help you understand the customer segments and the demand generation channels.

Let’s say you’ve determined it’s a $30K AVC. that’s 20 deals a year for a $600K quota, that’s 17 fully-ramped AEs. A 4:1 ratio of AEs:BDRs will give us 4 BDRs which gives us a total of 21 individual contributors.

With a team of 21 ICs (ratio of 7:1 of ICs:Managers) we’ll want 3 leaders (2 Managers and a VP). This gives us a total of 24 people. Now, we don’t like in a perfect world so let’s apply a 75% yield. That gives us 30+ people and we haven’t yet discussed marketing or customer success.

If you’re a first time founder you will need more than what I’m saying - it just always seems that first time founders need 2X everything than they think. But as much I can spin off back of the napkin math, the point is that there’s no standard.

You have to back into this: start with your revenue target and your ACV. You need to know your ICP, you need to understand your segmentation, and you need an operating model.

A quick note on customer success: it really depends on how you need to or want to serve the client base.

What were some of the biggest mistakes you made with your first few sales hires?

  1. Hired for the wrong phase
  2. Didn’t consider the profile of the individual
  3. Didn’t align around a clear scorecard (specifically which criteria were must haves)
  4. Not thinking that the sales rep I was looking for was in market

Other than familiarity with the space, what is the biggest character trait you look for when hiring sales?

Coach-ability

note: familiarity with the space matters the more complex the sales process; I’ve not found it to matter with less complex sales.

Who/what did you lean on when hiring sales people if you didn't come from a sales background yourself?

I'm a classically trained sales rep think Miller Heiman, Huthwaite International, Ken Blanchard, Dale Carnegie.

When do you hire senior sales managers vs focusing on individual contributors? Are early hires expected to do both and transition with time or are different types of sales leaders needed for different stages?

See question 2. I go back to the operating model. You want to have more than 7 individual contributors to a manager.

How do you set realistic expectations for metric goals across your sales team?

First off, you're building a startup so you have to define "realistic" for yourselves. You have to find the balance of pushing for your vision and desired future state with where things currently are.

I would fall back on the operating model and really take a hard look at the assumptions. Sales metrics come from the assumptions you've made so I would focus there.

How did you best equip early sales people to succeed if you didn't have a set GTM script when you started hiring them?

Early sales people should want to come into a company that isn't a well-oiled machine and have a strong desire to figure it out and believe in what you're doing and be excited to help the customer solve their problems. The best way you can equip them is hire well, give them autonomy, and be supportive.

For sales they should have a desire to help you build out the discovery call guide and the presentation guide. Support them with daily call reviews.

How do you think about KPIs when you don't have a repeatable sales process yet?

I think about the inputs: the activity, the learning process, the experimentation, and the learning.

How to lead a sales conversation

Prerequisites include: go-to-market assets

Start with a plan for your call. I have written hundreds of sales call prep sheets. You have to have a game plan going into the call. Prepare. Once you're on the call make it all about discovery. Set the agenda, be flexible, ask for permission to ask questions. You're looking to create safety, build trust, and create rapport with the conversation.

Note: Record the call so you can review it and gleam lessons.