Nailing Founder-led Sales I #041

When should founders stop being their company's best salesperson? We break down the art of transitioning from founder-led sales to a sales team, sharing practical triggers for timing, hiring tips, and common pitfalls to avoid. A must-listen for founders planning their next phase of growth

Creators and Guests

Host

Raul Porojan

Director of Sales & Customer Success at Project A Ventures

Host

Toni Hohlbein

CEO of Growblocks

What is Revenue Brothers?

What happens when a VC and a CEO come together?

– They nerd out about all things revenue. And they don’t always agree.

Raul Porojan of Project A Ventures and Toni Hohlbein of Growblocks are the Super Revenue Brothers. In every episode they dissect and debate current issues in B2B SaaS, and offer solutions on how to solve them

No matter if you’re an early-stage startup or a scaling unicorn – you’ll always learn something new.

[00:00:00]

Introduction
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Toni: When you don't do anything but sales [00:00:03] anymore and you don't get to do all the sales as possible, if you're [00:00:06] founding team and your role is to sell, then [00:00:09] basically, ~uh~ screw all the meetings, screw all the other stuff. If [00:00:12] your calendar's all done with you just selling [00:00:15] and you could do more but can't, that's a good time [00:00:18] to hand it over. ~Yeah.~

Toni: So I've been talking to some [00:00:21] folks. ~Um, ~I've been doing this thing myself for a really long time. [00:00:24] And I think this year is a topic that a lot of [00:00:27] people are kind of struggling with. So what am I talking about? [00:00:30] I'm talking about founder led sales [00:00:33] and then doing the handover eventually to, ~you know, ~your [00:00:36] founding AE or your director that you hired, et cetera.

Toni: Is [00:00:39] that an issue that you also sometimes run into?

Raul: Yeah. Every single [00:00:42] venture I'm working with right now, ~actually, which is. A couple, uh, ~actually has this as an issue ~and, uh, ~[00:00:45] not necessarily because it's a problem, but ~it, ~because it's something that they [00:00:48] try to have at the forefront of their mind, where are they [00:00:51] currently at and what is kind of the right way to go about it.

Raul: ~And ~there is [00:00:54] also different stages for it, but, ~uh, uh, ~they all, ~Kind of ~became cognizant of [00:00:57] that. ~And ~interestingly enough, I would say maybe two, three years [00:01:00] ago, ~uh, ~this wasn't even a thing ~like ~this term founder led [00:01:03] sales was, ~uh, ~not as widespread and I don't know exactly where it [00:01:06] came from, but it's kind of a thing right now.

Toni: Yeah, ~I mean, so, ~I mean, there's the whole [00:01:09] inbound lad and then there's outbound led and there's all of these things, [00:01:12] right. And so they had to ~kind of ~create something with the led, ~uh, ~you know, in the end, [00:01:15] obviously, but I think ~the, the, ~the reason why it probably hasn't been talked [00:01:18] about much, it's like, because it's just too darn [00:01:21] obvious.

Toni: It's like in the beginning of the venture, who's doing the sales is the [00:01:24] founder or the founders or whoever. Right.

Being a Founder is a Sales Job
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Toni: And [00:01:27] I think, ~um, ~If anyone is in doubt, either kind of listening, [00:01:30] being a founder or thinking about being a founder, eventually, ~um, ~[00:01:33] it's a sales job, like it's a [00:01:36] 24/7 sales job, you're doing nothing else, but [00:01:39] selling for the first two, three years.

Toni: And after that you will [00:01:42] continue selling just to a different audience. So, you [00:01:45] know, just to be clear, what I mean is the first thing [00:01:48] you're doing is you're selling to, ~um, To ~your co founders, you want to acquire [00:01:51] and hire into your team, right? You're selling to them kind of the vision and, you know, [00:01:54] where this thing could be going.

Toni: The next thing you're selling to [00:01:57] is investors, depending on how you play this. ~Um, ~then [00:02:00] you're selling what everyone thinks they're selling to customers [00:02:03] and stuff. ~Um, ~and then later on, you know, you're selling to [00:02:06] the team, the vision and so forth, and then eventually that will be the [00:02:09] only thing you're doing.

Toni: But founding a business, [00:02:12] being a founder, I think ~it's, ~it's a Yeah, sure. [00:02:15] Product and everything, but it's predominantly a sales [00:02:18] job. ~Uh, ~I'm not sure if you see this differently and kind of what do you see [00:02:21] out there, but ~like, ~for me, that's very much the job description.

Raul: [00:02:24] Yeah. I would also say that's the case for basically every founder, [00:02:27] because what I've seen a lot is that the. Let's say [00:02:30] that there's ~like ~a technical founder and ~then there's like ~a commercial founder or maybe [00:02:33] even a product person in there. ~And, uh, ~it's kind of like the [00:02:36] onus of everything that has to do with sales is, ~uh, on the, in the, on the, ~on the [00:02:39] commercial founder, ~whatever they are.~

Raul: And, ~um, ~you just don't have that luxury in the beginning, to be [00:02:42] honest. ~Uh, ~but ~it's, ~it's changed a couple of companies I've [00:02:45] recently seen where even the technical people ride [00:02:48] out from the start, go with [00:02:51] customers, ~take, uh, ~maybe they don't do prospecting or maybe ~they, ~they're not the person jumping [00:02:54] around on events, but they're the ones that maybe take on a lead [00:02:57] that's more complicated ~and, and deal with them and deal them ~and go with them through the process.

Raul: ~And ~[00:03:00] there's even one venture I'm working with ~them ~where the [00:03:03] technical and product founder are also in those [00:03:06] sessions and in the coachings that we do with them. ~And, uh, ~I think they benefit ~quite, ~quite [00:03:09] strongly from that.

Toni: Yeah, I think ~it's, ~it's a core [00:03:12] skill. ~Um, ~and I think I can just kind of talk [00:03:15] from my own experience ~in this, ~in this specific topic. So I've never actually [00:03:18] been a sales person, ~um, in the, ~in the ~original ~traditional sense. [00:03:21] So I've never done the SDR route or the AE route or the [00:03:24] account management route.

Toni: I've done this other thing, kind of the [00:03:27] sneaky revenue operations and then. ~Some reason ~ending up being, you know, [00:03:30] amongst other things, a sales leader. ~Um, ~so I haven't had any sales [00:03:33] training previously. I've been talking very knowledgeably [00:03:36] about how, ~you know, ~it should be done. Like obviously you need to follow, ~you know, ~[00:03:39] MEDDIC and the CRM and all of that stuff.

Toni: ~Um, ~but I actually [00:03:42] have never really actually done it myself. Right. ~Um, ~so jumping into the [00:03:45] founder thing, ~um, ~I think what I got right. [00:03:48] You know, many things I got wrong, by the way, but maybe this is one [00:03:51] thing I got right is, ~um, ~just from the beginning, just playing [00:03:54] up like, you know what, this is what this is.

Toni: I'm a [00:03:57] sales person now. Just jump into it with all of your [00:04:00] persona. And embrace it. ~Um, ~and you know, ~uh~ I was [00:04:03] basically the best SDR in the company, ~uh, ~for two or three [00:04:06] years. ~Um, ~I'm actually kind of a little bit of an introvert, [00:04:09] so kind of going on LinkedIn and posting there all the time, not my [00:04:12] thing, but Hey, I'm a salesperson now, that's totally fine.

Toni: It's [00:04:15] totally in tune with my character that I have adopted now. ~Um, ~and [00:04:18] then over time actually kind of realizing and understanding how the [00:04:21] sales thing works, ~um, ~I mean, ~it was, ~it was a journey. ~Um, ~and ~you know, ~I guess what I'm [00:04:24] trying to say is like, it doesn't matter what kind of founder [00:04:27] you are, ~uh, ~part of your job or the majority of it will [00:04:30] be sales.

Toni: And I guess that's what people are calling [00:04:33] like founder led, right? That's the idea behind it.

Levels of Founder Involvement
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Raul: There's [00:04:36] also this model, right? So there's basically a [00:04:39] framework for it, ~that, ~that there is more of an idea that [00:04:42] yes, the core is the founder is doing sales, [00:04:45] but, the idea there is also that there is kind of levels ~and, uh, ~the first [00:04:48] level is called There's different names for it, but the most [00:04:51] prevalent one is probably~ founder let, sorry, ~founder sales, [00:04:54] where the founder is doing basically all [00:04:57] the sales or the founders.

Raul: And then there's founder [00:05:00] led sales, which is kind of the second level. [00:05:03] Founder led is where there's maybe a first hire, ~uh, ~or [00:05:06] maybe like an intern ~or. I don't know, ~maybe like a kind of a mixed [00:05:09] role and the founder is still leading the ship and [00:05:12] then it goes to director or VP led and then head [00:05:15] of lead or head lead.

Raul: The idea here [00:05:18] is that as you progress through kind of the [00:05:21] organizational growth, your, [00:05:24] maturity needs to change and kind of the way that you do [00:05:27] things needs to change. So obviously in the beginning when [00:05:30] you're alone and you're doing head kind of like a founder sales or [00:05:33] even founder led, you probably don't need the perfect [00:05:36] CRM set up.

Raul: You probably don't need a perfect ~progress ~process set up [00:05:39] as you progress. ~Uh, ~quite soon things [00:05:42] such as collaboration and communication between people become more [00:05:45] important because it's not all in your own head and now [00:05:48] you need to probably, ~uh, ~include a couple more aspects to [00:05:51] this. Okay. But in the beginning, ~uh, ~things are quite [00:05:54] simple.

Raul: ~Um, ~the difficulty typically is [00:05:57] switching out of that and getting to a new headspace. And [00:06:00] I find that some reasons for that are, ~um, ~[00:06:03] I mean, some founders are very cognizant of that and then they're just really [00:06:06] scared. They don't know how to progress to that and that's fine. You [00:06:09] probably should have a little bit of respect for that, but some are also a little bit [00:06:12] ignorant and they think that it's always going to go like that.[00:06:15]

Raul: And, ~um, ~this is, I think the one thing ~that, that, ~that I can bring ~like in, in, in, ~in [00:06:18] this discussion right now is, ~um, ~things change [00:06:21] and it is quite a little bit of work to build an org. [00:06:24] Obviously, regardless of ~like ~the hiring work [00:06:27] and regardless of the management work, just the [00:06:30] underlying assets and the underlying things that need to be there to be able to have [00:06:33] five, 10, 15.

Raul: 20 people [00:06:36] is different than when you were alone.

Toni: Yeah.

Raul: At the same [00:06:39] time, the output is probably not going to be 20 [00:06:42] X to what it was before. And, ~um, ~I've seen this [00:06:45] almost without exception. And I wonder what you have seen [00:06:48] about this, where founders [00:06:51] that are not salespeople by trade, ~um, ~start doing [00:06:54] quite well. And then the ship kind of takes off.

Raul: They [00:06:57] start hiring people, expecting them as trained [00:07:00] salespeople to perform to outperform them significantly. [00:07:03] And then that doesn't really happen. Have you seen that a lot?~ Okay.~

Toni: Yeah. A hundred [00:07:06] percent. ~And, um, ~and that goes across the board by the way, because ~the, You know, ~when you really [00:07:09] think about what's happening there is, ~um, you, ~you get the [00:07:12] founder CEO bonus in every conversation you're having, especially if you're [00:07:15] out there and, ~you know, ~visible, then there's an immediate trust that you [00:07:18] get just because they might have even seen you on LinkedIn or ~kind of ~[00:07:21] listened to a show or ~kind of ~seen you on ~kind of ~some video.

Toni: ~Um, ~but [00:07:24] also because you're the founder and CEO, what you're saying carries [00:07:27] a little bit more weight. ~Right. Kind of, ~when you say like, ah, you know what, this is a good point. Maybe we're [00:07:30] going to build this feature that sounds a little bit, ~you know, ~cleaner and [00:07:33] clearer than ~if, ~if the salesperson does that, ~right.~

Toni: So if you're now [00:07:36] switching this out, if you're not having a professional take over that [00:07:39] knows how to run a sales process and so forth, ~kind of, ~there are a couple of [00:07:42] mechanics where the person is going to be better than you are. ~Um, ~[00:07:45] but all the benefits, all the bonuses go away. So I would [00:07:48] actually say if you're able to keep the same.[00:07:51]

Toni: efficiency, if you will, like conversion rate or win, like, you [00:07:54] know, whatever that means in the beginning, if you're able to keep the [00:07:57] same efficiency, I think then you're winning. I think that's a [00:08:00] great thing ~kind of ~to have ~that ~at that point, right? The [00:08:03] counter intuitive argument then, well, maybe it's a [00:08:06] de intuitive argument.

Toni: It's like, well, ~you know, ~I'm a, ~you know, ~[00:08:09] two out of five stars salesperson, ~um, ~and I'm [00:08:12] losing all of those deals. ~Um, ~so if a five out of [00:08:15] five star salesperson comes in, then they don't lose those [00:08:18] deals. So we kind of probably kind of,~ you know, ~win more overall, [00:08:21] but especially in the beginning, ~there's ~your company [00:08:24] is just a ~shitty, ~shitty startup and trust is a major [00:08:27] issue.

Toni: And you as a person, as a CEO founder, you're the one [00:08:30] that can mitigate the trust issue much, much better than the other ones. [00:08:33] So when you hand this over to someone else, what's going to [00:08:36] happen is ~you're going to ~you're going to start maybe winning some of the deals that you [00:08:39] messed up because you know, you didn't have the mechanics, but you're [00:08:42] going to lose some of the deals where maybe the bonus [00:08:45] or the heavyweight was actually on the trust and the [00:08:48] relationship and really making sure that things work together.

Toni: Right. ~And, ~and that's [00:08:51] kind of the balance you need to be aware of. And I think if [00:08:54] anything, ~You know, ~managing this and thinking about [00:08:57] this for myself is like, ~um, you, ~you kind of want to suss out, ~um, ~[00:09:00] where the founder should still be involved, right? ~Kind of, that's, ~that's almost the [00:09:03] trick here. Have you, ~have you kind of ~seen a good way ~to, ~to [00:09:06] balance that~ in~ in that transition period to ~kind of ~figure out where ~the, kind of ~the [00:09:09] founder should be, ~you know, ~looped in or, ~or maybe, ~maybe where you should be staying [00:09:12] away.

Raul: I refer to that as kind of like founder magic. [00:09:15] And, ~uh, ~I think that there's a couple of founder [00:09:18] magic, ~uh, ~levers actually, and ~the, ~as you progress [00:09:21] forwards, I think the better people, what they [00:09:24] find is what their individual magic is that they can [00:09:27] really bring. And, ~uh, ~I'll just give us an example because you were also there [00:09:30] is when we talked to Julius from

Toni: Yeah.

Raul: [00:09:33] And, ~um, ~he just found out that his founder magic was being very close [00:09:36] to the action, leading by example, kind of being in the [00:09:39] trenches and, ~um, ~just making sure the big accounts were [00:09:42] obviously his name and his title and all that stuff was really [00:09:45] important, but that was really his thing, right? Being on the road, being with [00:09:48] truckers and, and, and leading, leading that.

Raul: And that was really [00:09:51] helpful for sender and, ~uh, ~and it's to this day. And then other [00:09:54] founders, ~um, they, ~they do it a little bit differently. So for others, they [00:09:57] maybe find out that they're not especially the greatest [00:10:00] salespeople, but that they can be kind of like more [00:10:03] of a spokesperson ~and, uh, ~and be a branding ambassador and, ~uh, ~then [00:10:06] have leads funneled through them and just give people their LinkedIn profile, for [00:10:09] example, ~um, ~for others.

Raul: It's that [00:10:12] they're, ~um, ~really good at ~kind of like ~managing multiple stakeholders [00:10:15] and they ~kind of ~have ~a little bit of ~a better grasp because they've been doing this for two, three [00:10:18] years on the market and maybe it's really complex and they [00:10:21] understand big accounts. So they really help structure [00:10:24] deals together with the team.

Raul: And so they collaborate a lot on [00:10:27] deals and maybe they're still. I don't know if they sell to Coca [00:10:30] Cola or Metro, maybe there's still the person in the deal, [00:10:33] but the heavy lifting, the 90 percent of work is done by the sales [00:10:36] team. And then others, they're just ~really, ~really good at passing on [00:10:39] all the knowledge ~that they, ~that they have had.

Raul: And obviously not everyone is good at all [00:10:42] these things, but I think this founder magic [00:10:45] thing ~and, uh, and, and, ~and the different levers is for some founders, [00:10:48] they haven't really grasped it yet that they're not [00:10:51] just some random. Dude, or some random [00:10:54] girl who was like, okay, like, Oh yeah. I'm just like, ~uh, ~every [00:10:57] person off the street, but I'm a founder.

Raul: ~Um, there's some, ~typically there's [00:11:00] something that's different about founders. And yes, the title is one of [00:11:03] them, but almost always without maybe [00:11:06] realizing it. ~Um, ~You probably have a little bit of a different [00:11:09] outlook on kind of like risk and ~like ~deal making. [00:11:12] You probably have a little bit of a different outlook on the business [00:11:15] itself or a little bit of a different understanding on market and all these things.[00:11:18]

Raul: And there's many more things that are different about [00:11:21] founders and the way that founders think, which enable them [00:11:24] to close deals early on, maybe even if they're not a salesperson by [00:11:27] trade. And if they are cognizant of that, they can bring those [00:11:30] things to the team quite well.

Toni: So on this, this whole kind of spiel also [00:11:33] made me realize, I think there are people out there [00:11:36] that, ~uh, ~I'm trying to push the sales job away as a [00:11:39] founder and trying to hand it over too quickly [00:11:42] to someone else. ~Uh, ~that is maybe not part of the founding team. ~I think, ~[00:11:45] and I think this is general, very un, you know, [00:11:48] obviously obvious knowledge by now is like, that's a bad [00:11:51] idea.

Toni: ~Right. ~Kind of trying to outsource product market fit, which [00:11:54] is, you know, this sales job is part of that, ~right. Kind of ~part of [00:11:57] reaching product market fit is signing up customers and [00:12:00] going through that process is going to reveal [00:12:03] cracks ~in, ~in your offering and the match to [00:12:06] the market and so forth. ~So kind of ~closing deals is basically, ~you know, ~[00:12:09] a very, very strong sign for product market fit.

Toni: Right. Kind of [00:12:12] trying to push this away to someone too early. ~That's kind of, that's, ~that's a big [00:12:15] mistake, I think. ~Um, ~

When to Hand Over Sales
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Toni: but then I wonder also, well, when [00:12:18] is that time actually, you know, people are always [00:12:21] wondering when do we have product market fit kind of, when is the right time to [00:12:24] actually do this? Do you have some tips on ~like when a, ~when a good time is [00:12:27] to start, ~you know, ~giving it to someone else?

Raul: I would actually just [00:12:30] disagree with one thing is that most founders have understood that they shouldn't [00:12:33] outsource sales. I am still shocked by a lot of [00:12:36] founders early, early, early stage [00:12:39] who are already talking to outsourcing agencies or [00:12:42] like, ~uh, uh, yeah, ~I have these, these people that do some [00:12:45] sales for me and I give them a commission or like, okay, and how much do you do of that?

Raul: Yeah. [00:12:48] I just go in with a negotiation. ~Um, uh, ~well, I agree with [00:12:51] everything you said. I think, ~uh, ~it's actually not, uh, [00:12:54] market. ~Um, ~so for when is it time to transition out of [00:12:57] that? ~Um, ~yes, I think there's many ~looks, ~things to look at, right? So, ~uh, ~[00:13:00] if you listen to, ~uh, ~VCs, ~uh, ~I recently had this discussion with [00:13:03] a really nice venture I'm working with.

Raul: I'm ~really, ~really a fan of what [00:13:06] they do. ~Um, ~very prominent San [00:13:09] Francisco VC told them, ~uh, ~don't hire for two [00:13:12] years. You have to do everything yourself for a year or two, ~uh, ~in sales. Right. [00:13:15] And so basically ~the, ~the gist there is just do what the VC [00:13:18] tells you. And I think that's probably the wrong way to go about that.

Raul: And I [00:13:21] know why the VCs says that because a lot of ventures have been over hiring [00:13:24] and they're kind of trying to counter steer that. Uh, and then [00:13:27] there's, okay, let's look at some underlying factors. Product market fit is a big [00:13:30] one. I would say that to me in product market fit, [00:13:33] what's even more important though than are we selling the thing is [00:13:36] are people using the thing as they should because that [00:13:39] is more of an indication to, ~uh, ~is a product market fit ~and, um, and, ~[00:13:42] and also early stage sales.

Raul: There's, they're not always [00:13:45] made the same way.~ So, uh, ~This is not the case anymore, especially because, [00:13:48] not because founders are doing this less, but because we see us have [00:13:51] caught on more and more where people who are very well [00:13:54] connected can kind of produce product market fit out [00:13:57] of thin air with just their friends and families and their, their [00:14:00] network.

Raul: And that is not product market fit, that is just, ~you have a lot, ~you have a lot of [00:14:03] friends and they just owe you a favor and you're well [00:14:06] connected.

Raul: Just 10 years ago, this wasn't the case that VCs understood [00:14:09] that so much yet. And now they do. So you [00:14:12] can easily get by that. But I still do see that a [00:14:15] lot of founders kind of overestimate the sales they have in the [00:14:18] beginning, ~uh, uh, ~towards a signal of ~their, ~their product market fit. [00:14:21] And I think the better signals really to look at is are [00:14:24] people using the thing as they should?

Raul: And can you [00:14:27] reach kind of a broader audience? And do you even know what that [00:14:30] audience is?

Toni: So, I mean, you were kind of dancing around kind [00:14:33] of when is the right time to hand this over? I have a very [00:14:36] pragmatic way to think about this. [00:14:39] It's. ~Um, ~when you don't do anything [00:14:42] but sales anymore and you don't get to do all the sales as [00:14:45] possible, kind of, that's how I'm actually thinking about it because at [00:14:48] that point, you know, if you're like solo founder, I think it's different, but if [00:14:51] you're founding team and your role is to sell, then [00:14:54] basically, ~uh, ~you know, screw all the meetings, screw all the other [00:14:57] stuff.

Toni: Yeah, sure. You have a prior meeting here and there, but. If your [00:15:00] calendar's all done with you just selling and you [00:15:03] could do more but can't, that's a good time to hand it [00:15:06] over. ~Yeah. ~And you know, ~some, some, ~some smart people out there gonna say, well, Toni, [00:15:09] shouldn't you start this process three months earlier?

Toni: Sure, ~you can, you can, you know, ~do [00:15:12] that and be a bit more foresight and so forth. But ultimately it [00:15:15] actually should be about, ~um, ~when are you running out of [00:15:18] capacity and or alternatively. [00:15:21] When is it that, ~you know, ~something else more important, maybe it takes a [00:15:24] little bit more of a time, for example, a fundraise, right?

Toni: ~Kind of that, that would be a thing. ~Usually [00:15:27] the selling founders, also the VC and [00:15:30] investor selling founder, if you're kind of, that's usually the same person. [00:15:33] So, you know, if you're coming up to a fundraising phase and it's really [00:15:36] busy, ~um, ~you, and, and you can't do the selling job anymore, [00:15:39] that might be another reason where you kind of maybe need to look for help.

Toni: Right. [00:15:42] But before that, you know. Also, you [00:15:45] know, in this regard, really important to be [00:15:48] honest to yourself. Are you handing it off to someone [00:15:51] else because you just really don't want to do it anymore and you're like overly busy [00:15:54] and you need to do other things. ~Um, ~or, or are you really [00:15:57] busy and you need to, you need to have additional help for this to work out, right?

Toni: Kind of [00:16:00] be honest with yourself in that process.

Raul: So now we know when to [00:16:03] do it.

Toni: Yeah.

Raul: As for the, how have you [00:16:06] seen any big mistakes? Like, have you seen, ~uh, ~what [00:16:09] you just named one, which is basically a mistake in [00:16:12] the decision of doing it because you just don't want to do it anymore. [00:16:15]

Hiring and Onboarding Salespeople
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Raul: But other than that, kind of in the execution, what do you see [00:16:18] people, ~uh, ~doing wrong?

Toni: Underestimating ramp up above the other side. [00:16:21] Like that's, that's usually kind of a thing. ~Um, ~for actually [00:16:24] kind of previous to that, hiring the right profile. ~Um, ~[00:16:27] and you know, there would say you, depending on the [00:16:30] product that you sell and so forth, right. But my reference would be [00:16:33] smart person, ~uh, ~willing to do the grind and I believe [00:16:36] it.

Toni: ~Um, ~and I would buy from that person myself. Right? Some of the [00:16:39] other pieces, like industry and so forth, fits. [00:16:42] And the reason that why I said, Oh, this is less is so important. What ~do ~you probably do want to look [00:16:45] for is have they sold in the same ACV before? ~Right? Kind of, ~[00:16:48] that's probably what you want to check.

Toni: If you have someone that has been [00:16:51] selling $2000 tickets, and now you want to put them into an enterprise [00:16:54] position, you know, they need to go out and buy a suit first before they can. I [00:16:57] mean, you don't want to do that, right? ~Kind of, ~you want to kind of find [00:17:00] the right, ~um, the ~match there, but ~um, that's, ~that would be ~my, ~my [00:17:03] preference.

Toni: ~Uh, ~takeaway and kind of finding the right person. ~Uh, ~another [00:17:06] takeaway could be, should it be one or two, like, do you [00:17:09] maybe want to start with two instead of one? So you want to really [00:17:12] avoid the, ~um, ~Hey, is it a person problem or is a [00:17:15] product market fit problem? ~Right. Kind of, ~that helps you with that.

Toni: Depends on your [00:17:18] cash, depends on your pipeline and so forth. ~Um, ~and then the third [00:17:21] one is, which was pretty much my first one that I wanted to start [00:17:24] with was, , making sure you're over investing on the ramp [00:17:27] up. and not having the expectation or kind of gave that person a [00:17:30] month and I taught them stuff and, and now I can do some [00:17:33] other things, you will overlap with them for a [00:17:36] really long time.

Toni: Like it will take [00:17:39] quite some time before it can really let loose. And maybe you [00:17:42] give this to a director or promote someone from them ~to, ~to this [00:17:45] role. ~Um, ~there's a lot of, ~uh, uh, ~work and handover that [00:17:48] is not just a documentation piece and a teaching piece. [00:17:51] It's way more implicit knowledge that's going to happen over the [00:17:54] next three to six months.

Toni: ~Yeah, yeah,~

Raul: What you just said with the, I would [00:17:57] say the ramp up time, but also kind of implicitly [00:18:00] the effort required from a founder. ~Uh, ~[00:18:03] let's call it onboarding. Let's call it, I don't know, you just have them tag along [00:18:06] and there's different ways that founders kind of try to cheat themselves [00:18:09] out of the work that is required to be done.

Raul: But that is part [00:18:12] of the reason why, and I've been a little, I've been criticized by [00:18:15] some founders because of that, ~um, ~that I sometimes tend to [00:18:18] err on the side of, Let's just hire two or three people. And, ~uh, ~[00:18:21] it's yes, maybe it is a bit early and in theory [00:18:24] it is. And, ~uh, ~if I just look at the numbers, it probably is too [00:18:27] early for the second hire right now.

Raul: I agree with that. And the VC would probably agree with [00:18:30] that, but I also know that if you don't get [00:18:33] the second person now, first of all, there's a good [00:18:36] reason. One of them is not going to make it. ~Uh, ~because you're not kind [00:18:39] of the perfect on border yet, and you're still kind of [00:18:42] growing into this role of a manager as [00:18:45] well.

Raul: ~Um, ~but also because you don't want to make that effort three months [00:18:48] later again. Because the thing is that early stage [00:18:51] founders, It's, it's kind of a blessing and a [00:18:54] curse. ~Uh, ~they, they think month to month, day to [00:18:57] day, which is a good thing, kind of like, let's just focus on [00:19:00] tomorrow.

Raul: But if we know already, and we even have it [00:19:03] in a plan and there's even maybe budget for it, that you are [00:19:06] going to hire two people with the next six months. And you just want to stagger [00:19:09] them and just take one person now. And then another one, two [00:19:12] or three months from now, maybe just take both. Right now, [00:19:15] because of the specific, precisely the thing that Toni said.

Raul: [00:19:18] Now, this is not true for everyone. Some people have a very [00:19:21] easy time naturally onboarding people. Some people are more [00:19:24] experienced in it and they maybe have a higher shot. Those are all [00:19:27] contributing factors to increasing the odds that that person will [00:19:30] work out. And I will also add to that, which is [00:19:33] the, the biggest mistake I see when hiring the [00:19:36] first person in sales is just.

Raul: [00:19:39] Kind of similar to the onboarding thing and kind of similar to ramp up thing, but it's [00:19:42] just the wrong expectations for what they will bring. [00:19:45] And that goes a little bit back to kind of extrapolating [00:19:48] from you as a founder, which not every founder is a commercial [00:19:51] person. And many times I've seen this thought exercise where people [00:19:54] are just not happy with the first hire because they're like, [00:19:57] well, but I'm not a salesperson by training.

Raul: I'm just [00:20:00] like some random dude from Berlin. And [00:20:03] how can it be that I'm doing like three deals a month and they're [00:20:06] not even managing one well, because you're a founder, [00:20:09] it could be that the person sucks, but it could also be that they [00:20:12] don't suck, ~uh, ~or somewhere in between, ~um, ~but they're not a founder. So [00:20:15] let's figure out how to actually build a company here.

Toni: ~one, ~one other [00:20:18] advice I would give, ~um, ~and it's a bit mixed advice.~ Um, ~[00:20:21] have some thoughts around the, ~uh, ~the compensation [00:20:24] model you want to give and have it before you hire them. ~Um, ~[00:20:27] because once someone is in their job and works there, it's [00:20:30] much more difficult to change compensation around and [00:20:33] compliance and all of that stuff.

Toni: You want to do that before they start. [00:20:36] And there's some flexibility, you just mentioned it. You don't really [00:20:39] know how much they will be able to earn. You maybe want to have a bit [00:20:42] of a softer approach, still like linear and give them [00:20:45] money for, you know, creating more work. And maybe it's not kind [00:20:48] of a massive cliff to hitting target or something like this.

Toni: ~Um, ~[00:20:51] but you want to put some expectations either in the hiring [00:20:54] process or early on, or kind of before they [00:20:57] [00:21:00] start.

Toni: And really kind of have some thoughts around this instead of [00:21:03] making the say, yeah, yeah, we will get there because the thing is. [00:21:06] These guys don't, I mean, they care and stuff, but they don't [00:21:09] give as much of a shit as you as a founder do [00:21:12] about just, you know, closing as much as possible. ~Um, ~they [00:21:15] have a life, they have other things, they have other priorities.

Toni: They're totally dialed in [00:21:18] with the team. Don't get me wrong, but the drive is completely [00:21:21] different. And the way you can help manage the drive is through a [00:21:24] compensation plan. And if you want to change [00:21:27] that later on and kind of move things around, because maybe you [00:21:30] overshot, or maybe it's kind of too rich, ~you know, You know, ~the drive of the person will [00:21:33] take a hit.

Toni: So ~kind of ~think a little bit, ~you know, ~before you hire these folks, ~kind of ~how [00:21:36] you want to set this up.

Raul: I think some founders wouldn't [00:21:39] be. Would be quite adamantly [00:21:42] disagreeing with you here. ~Um, ~by saying, well, okay, [00:21:45] Toni, that's fine at all. I'm just hiring [00:21:48] passionate people who are into this company as [00:21:51] much as I do. They don't really care about that. Like I'll just give [00:21:54] them a nice package, ~uh, and, and, ~and pay them like, I don't know, whatever [00:21:57] they think they can pay them for an intern or whatever.

Raul: ~Uh, ~but typically they're [00:22:00] underpaid. ~Um, ~and give them some shares because they have to believe in the same thing [00:22:03] as me. I won't even let them through the door unless they're [00:22:06] kind of a, ~uh, ~the same profile as me. ~And, um, ~I find that this [00:22:09] happens actually quite a lot. And as part of the reason that early stage [00:22:12] founders are trying to steer away from compensation, not even [00:22:15] because they wouldn't know how to do it, but because they just [00:22:18] are kind of like, Ethically morally [00:22:21] against hiring someone who would be motivated by money.

Raul: Have you seen that [00:22:24] as well?

Toni: I have, and I might have, and sometimes, uh, made [00:22:27] the same mistake, but I just [00:22:30] don't think it's correct. I just think it's, ~um, ~especially if [00:22:33] you're going for a specific profession, this profession is [00:22:36] sales. You know, you're hiring a sales professional. This [00:22:39] professional expects, you know, a specific thing as a comp [00:22:42] plan.

Toni: ~Um, ~and it is not only, you know, important part [00:22:45] of creating competitive offer for like good talent, because they [00:22:48] could maybe go somewhere else as well. But it's also [00:22:51] part of, ~um, you know, ~aligning what the salesperson does with what [00:22:54] the company does. ~Right. And, um, ~we can have a whole other conversation about are comp [00:22:57] plans, a good thing. At the end of the day, when we get to [00:23:00] the end of that whole conversation, We will all [00:23:03] agree that Compline is a good thing ~and ~and therefore kind of [00:23:06] Really, really think about it and try and implement it very [00:23:09] soon.

Toni: And the only obstacle that I kind of totally [00:23:12] understand and agree with is like, well, I don't know what the [00:23:15] target is. That's okay. You can design your way out of [00:23:18] this. ~Um, ~but you need to at least create an expectation that [00:23:21] once, once I'm going to set this target for you, which will be in three [00:23:24] months from now or whatever, ~um, ~then this is the comp plan we're going [00:23:27] with.

Toni: ~Right. ~And you don't want to have this conversation. ~Uh, ~out [00:23:30] of the blue after three months where someone maybe had a good [00:23:33] quarter, maybe made a lot of money. And now you're saying, Oh, new comp [00:23:36] plan. You know, we're going to cut your compensation basic and half of that [00:23:39] new comp plan, unless you kind of crazy overhead.

Toni: And that [00:23:42] is just a shit conversation to have. So try and have that a little bit earlier [00:23:45] and kind of do the expectation management around this.

Raul: ~Just a quick one here ~Wh

Balancing Founder and Sales Team Roles
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Raul: at do you [00:23:48] think is a bigger mistake hiring the first [00:23:51] person or moving out of founder led sales too early [00:23:54] or doing that too late?

Toni: ~Uh, ~I would say too early. [00:23:57] Moving out of it too early is the problem. ~Um, ~and we can debate this back and [00:24:00] forth, but, I think it's [00:24:03] extremely healthy to do founder led sales. I think it's extremely [00:24:06] important for product market fit. And yes, you're right. Product market fit is about [00:24:09] many other things than just the ability to sell stuff.

Toni: Totally [00:24:12] agree with this, but it's still, it's still an important [00:24:15] piece. It's really, really important. And [00:24:18] letting this go too early, I think that's a problem. ~The, the, the flips are ~[00:24:21] letting this go too late. Really what you have is [00:24:24] like, ~um, Hey, my, ~my sales team isn't set up in the right way. And it's still in chaos.

Toni: [00:24:27] And you know, those are okay problems. ~Um, someone, ~someone [00:24:30] told me at some point was like, ~um, ~Hey, ~uh, ~[00:24:33] technical debt ~is, um, ~is the reward for [00:24:36] surviving. ~That's, ~and I was like, wow, this [00:24:39] is so fucking true. It's like, this is absolutely true. ~Uh, ~[00:24:42] basically only the teams that make it far [00:24:45] enough. To start complaining about technical debt, they, you [00:24:48] know, this is, this is a sign of success actually.

Toni: And [00:24:51] it's the same thing with the organization. You can have organizational debt as [00:24:54] well, ~um, ~but you will only suffer on it if you actually [00:24:57] make it that far. So if you have to take on some debt in order [00:25:00] to build a bridge in order to get to that point, then maybe [00:25:03] this is better than playing it perfectly, [00:25:06] not having the bridge, not getting there and not getting into the position of, [00:25:09] of needing that, Organizational debt, technical debt, [00:25:12] whatever it might be.

Toni: I think we have, ~um, ~time for one more [00:25:15] comment, Mr. Raul. ~Uh, ~otherwise I think we're coming up on time here.

Raul: The reason [00:25:18] I asked that question is, ~uh, ~I would also probably agree with you. [00:25:21] Like, if I had to choose between one mistake, I would probably [00:25:24] choose to rather make the mistake of hiring too late. But I [00:25:27] think that this has been so widespread and so [00:25:30] vehemently argued by maybe people like us or like VCs [00:25:33] that, ~uh, ~there's kind of, people are steering [00:25:36] almost too strongly into the hiring very late ~Uh, ~[00:25:39] direction and there has maybe been an overcorrection and this is what [00:25:42] I've seen in the last year or two, ~not so much four or five years ago, um, ~where people have maybe drank the [00:25:45] Kool Aid too much.

Raul: And, ~uh, ~maybe there's actually a healthy ground in [00:25:48] the middle ~and, uh, ~and people are a bit ~too, ~too cautious of that. ~Uh, ~but yeah, like [00:25:51] I'm, this is just something I think about a lot and also something I've seen with one or [00:25:54] two ventures recently.

Conclusion
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Toni: Yeah, but I guess ~that's, ~that wraps it up for [00:25:57] today. ~Right. ~Founder led sales, a founder sales kind of ~that, that, ~[00:26:00] that classification was new to me, kind of really cool to hear this, ~uh, ~[00:26:03] when to do it, how to do it, which ~must make ~mistakes to avoid. ~Um, ~[00:26:06] I hope this was helpful folks. ~Um, and, uh, you know, ~hit the subscribe button if you can, [00:26:09] and ~then ~see you next time.

Raul: See you.