How to transition out of founder-led sales (Spoiler alert: It probably won’t be easy!)

Introduction

When a start-up is just getting going, its founders are usually heavily involved in sales.

That’s because they understand that those early customers are critical to their success.

But there comes a point when the founders need to step back and let trained salespeople take over.

We’ve just gone through that transition at Knak, and it was tough. In fact, it was probably the most difficult problem I have ever had to solve in my entire career.

Here’s how we did it. I hope our story will resonate with others facing similar issues – and help them avoid some of our missteps.

Why you need to get founders out of sales

Founders need to eventually step back from sales because a) it’s not the best use of their time; and b) a mature operation needs a professional, dedicated sales team.

That realization became evident to us as Knak grew.

I was our first sales person. I have a background in marketing operations (MOps). Before I started Knak, I was a MOps consultant. I knew the MOps persona very well.

This was incredibly valuable in Knak’s early days, because MOps professionals were our ideal customer profile. I was selling to people whose jobs we had done.

My co-founder Brendan was also in Sales with me early on. We were both pretty good at signing up those first customers.

But as the company grew, I found I needed to shift my focus to more pressing matters. So Brendan fully took over sales – until we realized he just couldn’t do it all on his own. That’s when we knew we needed a proper sales team.

(Also, we had figured out that because of our lack of sales experience, we were probably not maximizing the potential of the deals we were signing.) Brendan’s calendar was also booked solid every week with Sales demo requests.

We were going to have to make a leap of faith and trust a new salesperson with future deals, even big ones!

Why it’s hard to get founders out of sales

It’s hard to get the founders out of sales because a) it’s hard to give up control of something so important; and b) it’s difficult to set up a good sales department.

Once we realized we needed to hire a dedicated salesperson, we didn’t really think too much about it; we just hired someone.

We thought it would be pretty straightforward: Hire someone and let them get busy selling.

It’s not that easy!

Our first sales person didn’t have a sales background – she had worked in customer success – but she was very personable and had a real way with people.

It took a lot of work to get her trained, but she ended up being very, very good at her job.

She taught us something very important: that a non-founder could sell Knak!

I personally am someone who has to learn (or fail) by doing. So this was a key learning for me, because to give up control, I had to be able to see I was not the only one who could sell.

Because that first sales person worked out so well, we just hired more sales people when we needed them, without thinking through all of the details or requirements of scaling a sales team. We didn’t have playbooks. We didn’t have a formal sales kick-off or a training program. We didn’t have territories or real quotas. We figured that stuff would just work itself out.

It didn’t really work. A lot of those early hires did not succeed.

Brendan also had a lot on his plate given he was also leading the customer success team at that point in time. That led to the realization that we needed to hire a vice-president of sales, someone with sales knowledge who could run things properly and provide some leadership.

Finding the right person proved to be an even bigger challenge, for reasons that went way beyond training.

Neither Brendan or I are sales people; we’re marketers. We didn’t realize how much we didn’t know about building a sales team. So we made a lot of mistakes.

What we learned through our transition to a mature sales model

Unless you have a background in sales, you don’t really know sales.

The big learning for me is how much I didn’t know about sales. Looking back, I can’t believe how naïve I was!

I thought that because I could sell Knak, I could easily build a high-functioning sales team.

Boy, was I wrong!

I realized after the fact that because I had no background in sales at a software company, I had a lot of blindspots.

Take, for example, sales quotas, which put a dollar value on the software or services the sales team can expect to sell in a year.

If the sales team doesn’t have a quota, there’s no accountability, no way of assessing how they’re doing.

Set the quota too high, and the team won’t be able to meet it, which can hurt morale; but set the quota too low and the team can get complacent.

How do you know how to set the quota?

It’s not easy. It’s a combination of art and science that experienced sales professionals specialize in. They look at things like sales cycles, sales history, seasonality, current market conditions and competitive conditions. And they know that sales reps with different levels of experience will perform differently.

It’s part math, part behavioral science, part art..

I didn’t know any of this.

Also, sales has its own dynamic.

For example, we tried to hire salespeople from a well-known software company because we thought they must really know their stuff.

That software company was a big, well-known brand.

What we didn’t realize is that it’s one thing to sell a big, well-known brand, and quite another to sell a little-known company like Knak. A whole different skill set is required. So just because someone is really good at selling a top brand, it doesn’t mean they will be really good at selling for you.

Because we can’t depend on brand recognition to help us, we eventually realized we needed hungrier sellers, people who are at the start of their career.

We didn’t know what we really needed.

We hired our first real sales leader through a reputable sales recruiter.

But he didn’t work out because he wasn’t the right person for our needs.

In retrospect, we realized we had hired him without understanding what our needs were.

We discovered too late that what we really wanted was a go-getter who would meet with customers and prospects and figure things out. Instead, we got a process-oriented person who was very good with systems.

To complicate things, that first sales leader had brought along with him a whole bunch of people who had enjoyed working with him, but who were also process-oriented.

Can you see where this is going?

They didn’t meet their numbers, and a restructuring followed.

Which led to another learning: If you hire a new sales leader (a good one), expect them to bring their own people with them.

So don’t hire the new sales leader’s people until you are positive the new sales leader is a good fit. Otherwise, you will have an even bigger mess on your hands!

Another random hiring tip: When looking to hire sellers, see how long they have stayed with previous employers. If they move around a lot, it’s probably because they weren’t meeting their quotas.

Sales people have big personalities.

I was clueless about the role emotion plays in sales.

As this Harvard Business Review article explains, top sales people combine a strong sense of empathy – the ability to feel – with what its authors call ‘ego drive,’ or the need to conquer. They feel driven to make a sale.

Basically, good sales types are competitive, sensitive, social people with big personalities.

Their sensitivities, emotions and competitiveness need to be managed.

A salesperson with a powerful ego may end up feeling the company owes them something if they make a lot of big sales. Or they may be unwilling to share leads with new sales hires, or get upset about changes in quotas.

You may have to make sure, for example, that your best salesperson gets the leads involving the biggest prospects, and the newer sales recruits get leads that allow them to prove themselves.

The challenge through all of this is to create a sales culture that nourishes competitiveness while making sellers feel part of a team; that creates a balance between go-getters and process people; and that has people working well together despite big personalities and prickly sensibilities.I’ve now seen this working in practice and it’s a beautiful thing. When you have a good sales culture, the sellers are competitive with one another, but also encouraging and helping each other win. It’s a tricky dynamic and culture to nail. A lot of things need to be working together in unison.

We’re on track – I hope!

After more than a few ups and downs, we now finally think we’re on the right track.

Last year we hired Justin Sykes as Director of Sales and Greg LeNeveu as our new CRO (Chief Revenue Officer) and put them in charge of our sales team. It is early days and there is still lots of work to be done, but we’re delighted with the way things are going so far!

Through all of this I have learned quite a lot about sales. And I’d recommend any founder or CEO do so. In fact, the earlier you learn about sales, the better; I would have loved to have known more before we started building our team.

There are certain resources I used, like Pavilion, to help me learn more about sales. I also read as much as I could. And I tapped into my networks for advice.

Freeing the co-founders up from sales has been beneficial to both of us.

My role has evolved toward product strategy and what we’re building, while Brendan has become a Knak evangelist focusing on building deep customer relationships and spreading our customer stories.

Though it took us several years to figure out how to transition to what I call a mature sales model, I know it’s where we need to be.

But getting there was tough, as I looked for ways to juggle people, processes and all the external factors that came into play.