I've been the first VP of Sales at 3 different companies. I've had some great runs at those companies and some failures. What was in place when I joined played a big part in my success.
In today's issue, I'm going to teach you when to hire your first VP of Sales.
Hiring the right VP of Sales at the right time can be the biggest catalyst to growth in your early-stage startup.
On the flip side, the cost of a VP of Sales mis-hire is extremely high. Founders often hire this position too early and pay a significant price.
When you hire the right VP of Sales at the right time, you'll get:
Here's what needs to be in place:
The #1 most important thing that you want to have in place before bringing on a VP of Sales is product-market Fit. Without it, it's the equivalent of trying to race a Ferrari in the mud. It's expensive, and they will spin their wheels.
Nobody is better to take in market feedback in the earliest stages than the founder. You can make immediate decisions that significantly impact the company's direction. As a result, you will achieve product-market fit faster.
Make sure you have product-market fit within a customer segment. Let's use the standard $1MM in Annual Recurring Revenue (ARR) definition of product-market fit as an example.
On the surface, it looks like we are doing great. Diving deeper, there is a good chance that we haven't hit product-market Fit in any segment. The biggest issue here is bringing on a VP of Sales and scaling too soon.
Be confident you have product-market fit before hiring a VP of Sales.
A great first VP of Sales is a catalyst and not a savior. They will take a solid foundation and throw gas on the fire.
Customers without a previous connection to the founders must be coming in. You need new sales from outside the founder's network, investor referrals, or company friends. This signals a basic foundation for marketing, sales, and customer success.
If you don't know your Go-to-Market motion, it's tough to hire a VP of Sales whose skillset will match it. You need a VP with relevant experience to turn the foundation into a machine.
Two benchmarks to consider:
Remember, the VP of Sales's job is to be a catalyst. To be a catalyst, they need resources to build you a machine. It's unlikely you'll hit hockey stick growth if you expect the VP of Sales to come in and carry their own quota.
Growth will primarily come in 3 areas:
The VP of Sales will be recruiting, onboarding, coaching, and implementing their strategy. While they are focused on the sales reps, RevOps will build the supporting machine. The system upgrades will remove friction in the sales process and provide actionable data.
Combined, you have your roadmap to exponential growth.
Even the best VPs of Sales need support. Every company is unique, and your support during the first 90 days is critical to their success.
Some examples of what they need to know include:
Most importantly, make sure you're available to answer their questions. As they dive in and learn more, questions will arise. Your early support will go a long way to the future success of the sales org.
"By gluing yourselves together you will transfer a huge amount of critical knowledge to the sales VP. That, or you’ll drive each other crazy and discover you can’t work together. Either way, it’s good to succeed or fail fast. And the goal is total alignment." - Dave Kellogg
Hiring a VP of Sales with these items in place dramatically increases the odds of success. When they succeed in the role, it will serve as the #1 catalyst for the company's early growth.