{"id":678,"date":"2014-04-19T10:11:05","date_gmt":"2014-04-19T09:11:05","guid":{"rendered":"http:\/\/www.telekta.com\/blog\/?p=678"},"modified":"2014-11-21T10:33:44","modified_gmt":"2014-11-21T09:33:44","slug":"outsourcing-startup-sales","status":"publish","type":"post","link":"https:\/\/www.telekta.com\/blog\/2014\/04\/outsourcing-startup-sales\/","title":{"rendered":"Outsourcing Startup Sales"},"content":{"rendered":"

Don’t do it\"baby\"<\/a><\/strong><\/p>\n

Some years ago, I wrote about the challenges of finding others to do your sales for you (see https:\/\/www.telekta.com\/blog\/2009\/10\/practical-sales-outsourcing<\/a>)This past year, I have found myself more involved with startups and identified an additional insight that all experienced startup professionals agree on, but most technology-based new startup founders miss.<\/p>\n

Startups might be able to outsource engineering and operations (not without difficulty), but they should not even think of outsourcing initial sales for at least three reason:\u00a0<\/p>\n

    \n
  1. The All startups (or breakthrough product launches), if successful, will make at least one and perhaps three or more business pivots (Business Genome Project.http:\/\/blog.startupcompass.co\/).\u00a0 For those not familiar with the term “pivot”, in this context it means a significant change in product features, target customer, business model, or market position.\u00a0 For a founder, it also means recognizing that a major assumption in the master plan was flawed and that all the work associated with that part must now be trashed.\u00a0 Put this way, it is not all surprising that founders (or product owners in a non-startup context) would be slow to pivot based on feedback from a supplier, especially if it is filtered through a third party. \u00a0A founder must hear this disappointing news directly from his customers and acting quickly, come to the realization that action must be taken.\u00a0 At this business stage, agility is one of the founder\u2019s only advantage.\u00a0 A channel partner or hired gun salesman is at least one step away from being able to take action which slows down the feedback loop so much that it is often too late to pivot effectively.<\/li>\n
  2. The second reason not to outsource sales in the early stages comes from the nature of what is being built.\u00a0 Read the annual report of any mature software company (simplest example since it has not cost of goods) and you will see that the cost of engineering is typically 15 to 35% of costs while the cost of sales is around 50%.\u00a0 This means that a product company must be good<\/span> at engineering management but great<\/span> at sales management in order to succeed.\u00a0 Moreover, founders must be good enough at sales on their own to be able to select, drive, and know when to fire their new VP Sales when they enter their scaling phase.<\/li>\n
  3. Lastly, founders typically exude enthusiasm for their products, an enthusiasm that can excite the customer to action, especially when the customer knows that they are dealing with the head of the company. This can often push them to buy the product even when the lack of references and lack of proven value might otherwise hold them back.<\/li>\n<\/ol>\n

    For all you technology guys who have been designing your dream product over many long nights and weekends, welcome to the world of sales.\u00a0 In the war for early sales, Generals only lead from the front.\u00a0 Get help (especially from those experienced in \u201cfirst sales\u201d), but repeat after me: \u201cI am the<\/span> main salesman.\u00a0 Every week I talk with perspective customers before I do anything else\u201d.<\/p>\n","protected":false},"excerpt":{"rendered":"

    Don’t do it Some years ago, I wrote about the challenges of finding others to do your sales for you (see https:\/\/www.telekta.com\/blog\/2009\/10\/practical-sales-outsourcing)This past year, I have found myself more involved with startups and identified an additional insight that all experienced startup professionals agree on, but most technology-based new startup founders miss. Startups might be able […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-678","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/www.telekta.com\/blog\/wp-json\/wp\/v2\/posts\/678","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.telekta.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.telekta.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.telekta.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.telekta.com\/blog\/wp-json\/wp\/v2\/comments?post=678"}],"version-history":[{"count":7,"href":"https:\/\/www.telekta.com\/blog\/wp-json\/wp\/v2\/posts\/678\/revisions"}],"predecessor-version":[{"id":738,"href":"https:\/\/www.telekta.com\/blog\/wp-json\/wp\/v2\/posts\/678\/revisions\/738"}],"wp:attachment":[{"href":"https:\/\/www.telekta.com\/blog\/wp-json\/wp\/v2\/media?parent=678"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.telekta.com\/blog\/wp-json\/wp\/v2\/categories?post=678"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.telekta.com\/blog\/wp-json\/wp\/v2\/tags?post=678"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}