Sales at startups - a quick primer

Sales at startups play a critical role in the success of the company. It is a key driver of revenue and growth, and it helps the startup to validate its product or service and understand its target market better. Startups typically have limited resources, so it is important for them to focus on sales from the very beginning. This means identifying the right target market, developing a sales strategy, and building a sales team. 

The sales team at a startup is often small and nimble, which allows them to quickly adapt to market changes and test new strategies. Startups often rely on a mix of traditional sales methods, such as cold calling and in-person meetings, as well as newer methods, such as online marketing and social media.

Why do startups need sales?

As a founder, it is important to understand that sales is a vital part of building and growing your company.

The role of a chief salesperson is not just about closing deals, but also about understanding your target market, developing a sales strategy, and leading your sales team. To be successful in this role, you need to be able to communicate effectively with potential customers and understand their needs and pain points. Additionally, you should be familiar with the various sales tools and techniques that are available to help you and your team close more deals. This could include things like Customer Relationship Management (CRM) systems, lead generation software, and social media marketing tools. Overall, taking on the role of chief salesperson for your startup may be challenging, but it is essential for the success of your company.

Before you can lead the charge on sales, you need to know the lingo. Sales terminology might feel unfamiliar or even a bit rigid at first, but it provides a common structure for a sales process.

Key terms and definitions

Sales CRM — Software used to streamline pipeline management and safely store customer information, communicate with prospects, and drive more sales.

CRM objects — Represent the sales relationship you have with a specific person or company. There are four primary CRM objects: leads, accounts, contacts, and deals.

• Leads — Sales prospects generated through marketing, research, or outreach that have not yet been vetted through the lead qualification process.
• Contacts — People within a group who you communicate with, which includes information such as their phone number and email address.
• Accounts — A group containing multiple contacts or potential deals. In B2B sales, it typically represents a company. In B2C sales, it may be a household.
• Deals — Potential sales opportunities. You may have multiple deals and contacts under the same account, or you may have a single contact and deal.

Lead qualification process — The vetting process to determine whether a lead is likely to be converted and become a customer.

• Qualified lead — A prospect who is likely to be a potential customer.
• Unqualified lead — A prospect that has not been nurtured enough in the sales cycle

What are typical sales roles?

65% of startups fail due to management issues. So, when you’re building a startup, it’s about hiring the right people for the right positions—not just those who look good on paper.

So, what startup sales roles are essential for success? There are several typical sales roles at startups, but the most important are Sales Development Representative (SDR) and Account Executive (AE).

‍What is a Sales Development Representative (SDR)?

This role is focused on generating new leads and identifying potential customers. SDRs use a variety of methods, such as cold calling, emailing, and social media, to reach out to potential customers and set up meetings with the sales team.

The majority of an SDR’s time revolves around lead generation instead of closing new leads. The effectiveness of an SDR is measured by how successfully they are able to build up the sales pipeline and set meetings for their account executives. SDRs generally help with the lead qualification process while account executives focus their energy on closing deals. If you are recruiting for sales development representatives, keep in mind that you want people that bring a lot of energy, know their processes, be able to set meetings on the phone, and it will make a big difference when scaling and hiring sales development representatives.

• Researching and Responding: SDRs spend a lot of their time prospecting for new leads. Through research, SDRs are able to find relevant insight according to personas. SDRs should leverage social selling and use LinkedIn to check if any customer has visited their profile.‍
• Prioritizing Top Prospects: SDRs spend a significant amount of their time on the phone to get in touch with their top customers. However, it is important to get to a quick “no” with any prospects and continue to focus on ones that have the highest potential for growth.‍
• Cold Calling Blocks: Sales development representatives should make sure they are spending time doing their job! It is easy to work on stuff that isn’t challenging, but remember that when you are hired as a sales development representative, your primary goal is to set meetings and help drive revenue. ‍
• Meet with Product and Marketing with free time: Become a master of your free time. Give yourself a few hours a week to meet with the Product and Marketing team to ask questions, learn about when they are working on, and share this info with the account executive you are working with.

What is an Account Executive (AE)?

This role is focused on closing deals and building relationships with customers. AEs use their knowledge of the product or service to pitch it to potential customers and negotiate contracts.

A typical day of an AE involves showing up at meetings, conducting demos, connecting with the marketing department and researching for new leads. A quick breakdown of daily activities include:

• Connecting with SDR and the Marketing teams: A successful AE is constantly nurturing leads. To develop a better understanding of the types of leads coming in, AE’s frequently meet with the SDR and marketing team. They touch-base frequently with the marketing team and because marketing usually creates material or collateral for the AE and are driving leads.
• ‍Demos/ Calls: AEs typically spend 4 to 5 hours on the phone every day. Demos/calls are scheduled throughout the day and meetings are set via their sales development representative (SDR).‍
• Researching and Prospecting: AEs have to generate a portion of their outbound leads by prospecting. 1-2 hours of their day is usually spent researching and looking for new accounts and opportunities.

Many new accounts executives make the mistake of not managing their time and day efficiently. While it is good to be spontaneous every once in a while, AEs must have time blocks so that they can complete specific tasks. New AEs should be organized with their daily and weekly tasks.

How to hire SDRs and AEs?

Hiring a Sales Development Representative (SDR) or Account Executive (AE) can be a challenging task, but there are several key steps you can take to ensure that you find the right candidate for the job.

1. Define the role: Clearly define the responsibilities and expectations for the SDR and AE role, including the specific tasks they will be responsible for, the qualifications you are looking for, and the desired experience and skills.
2. Create a job listing: Write an effective job listing that clearly communicates the role, responsibilities, and qualifications you are looking for. Use relevant keywords and post the listing on relevant job boards and social media platforms.
3. Screen resumes: Review resumes and cover letters to identify candidates who have the qualifications and experience you are looking for.
4. Conduct initial phone screens: Use initial phone screens to further evaluate candidates and get a better sense of their qualifications, experience, and communication skills.
5. Conduct in-person interviews: Meet with candidates in-person to assess their sales skills, personality and work ethic.
6. Check references: Check references to ensure that the candidate has a proven track record of success in sales.
7. Hire the best candidate: After evaluating all the candidates, select the one who best fits the role and has the potential to succeed in the position.

It's important to remember that hiring an SDR and AE is not just about finding someone who has the right qualifications and experience, but also someone who is a good fit for your company culture and has the right attitude and work ethic.

Our post on SDR and AE hiring goes into the qualities you should target including technical aptitude, communication skills, and a passion for sales.

What are some sample questions for Sales Development Representatives (SDRs)?

Hard Skills/ Logic

1.  What do you understand by the term cold calling?
2. Have you met your target consistently in your last job?
3. How do you engage a prospective customer?
4. Give me your life story in 90 seconds
5. What do you think will be the most common objections you’ll hear during a call? How would you handle them?
6. Where would you research a prospect before reaching out?
7. If you had to teach a beginner an advanced concept, how would you approach the task?
8. I’ve gotten some feedback. Could you try again, but change X, Y, and Z?

Behavioral / Soft Skills

1. Can you sell me this cup?
2. Why do you think you are a good salesperson?
3. How do you deal with rejection?
4. Tell me about a time when you faced a setback.
5. How do you find a new customer?
6. What do you do when you have a bad sales day?

What are some sample questions for Account Executives (AEs)?

Hard Skills/Logic 

1. Define the stages of the sales cycle — which do you find most challenging? Why?
2. What was your quota? Your average deal size?
3. Tell me what kind of buyer I am, then try to sell me a product.
4. How comfortable are you with CRM?
5. Tell me your methods for finding sales opportunities.
6. If you had to help multiple clients at the same time, how would you prioritize your work?
7. Tell me about a time when you had to work with a dissatisfied customer.
8. Tell me about a time when you reached a goal despite the odds being against you.
9. How would you retain a dissatisfied client?
10. How would you support your assigned clients while also pursuing leads and making cold calls?
11. What would you do if a client informs you they've found a new supplier?

Behavioral / Soft Skills

1. How would your supervisor describe your work ethic?
2. What's your proudest accomplishment as an account executive?
3. What's your experience with cold calling?
4. What was your most complicated sales cycle in past positions?
5. What's your process for successfully negotiating a contract?
6. What inspired you to pursue the next opportunity?

About Rocket

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