Hiring a salesperson for a startup

This article indicates when a startup may need a sales rep, an overview of the types of sales roles, reasons to hire, and provides tips on hiring.

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When to hire a sales team?

Identifying the right time to hire a sales team can be challenging. It may seem that hiring early on can help grow a startup, but it can be costly if it does not pay off. 

Generally the CEO or founder should be the first sales representative before they begin hiring. This ensures they are able to sell their vision and pitch it to the right people. Selling as a founder also confirms that the product they are building is “sellable” and scalable to businesses. It also enables them to create the sales process and lead generation strategy from scratch, including:

• Overview of the product
• Ideal client profile (ICP)
• Competitors
• Calling scripts when pitching
• Discovery questions about their current processes

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Once a founder has started to close deals, it may be the right time to start hiring. Jason Lemkin of SaaStr says that a startup should not hire a salesperson until they have closed 10 sales. Whereas, other experts in the industry suggest the number is much lower before a founder should start hiring. 

Overall, it is the founder who knows their product inside out, and once they have begun to understand the individual client pain points, have a full oversight of the industry, and why their solution solves their problems they will know when to start hiring and training up a salesperson.

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What are the different types of sales roles?

There are different sales roles depending on the needs of the startup:

• Sales development representative (SDR): An SDR is responsible for finding and qualifying potential leads through cold calling, emailing and other prospecting avenues. SDRs interact with prospective customers to understand their needs and determine if they are a good fit for the company’s product.
• Account executive (AE): AEs aim to close deals with leads that have been qualified by the SDRs. AEs will also generate outbound leads by prospecting within their ICP.

Most of these roles are hired in house, but some startups may consider outsourcing their sales representatives. By outsourcing sales representatives from an outside firm means they will usually have a sales process already in place.

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Benefits of hiring a sales team

There is a clear advantage to hiring a sales team at a startup, aside from having the potential to accelerate a startup’s growth there are additional reasons to hire: 

• Targeting and closing qualified leads
• Increasing revenue
• Keeping CRM up to date 
• Shortening sales cycle overtime as the process for identifying qualified customers will become much more efficient
• Improving business reputation 
• Building relationships with prospective and existing customers
• Growing network

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Tips on hiring

When hiring a sales team it is important that the responsibilities and role is defined, and clear expectations are outlined from the outset. 

SaaStr’s Jason Lemkin suggests hiring more than one salesperson to have better measures of success. Having two salespeople enables them to target different ICPs to broaden their reach, and they may also be able to trial different prospecting strategies to see which works better.

Where to hire 

• Recruitment agencies: recruitment agencies specific for sales hires and specific for the industry can match up candidates for the job opening. 
• Referrals: Employees that are already on the team may have someone from their network that they know are looking for a job in a related industry or role so can refer them.
• Job boards: Posting the job role across different job boards can maximise reach.
• Direct outreach and recruiting: Searching through profiles on LinkedIn can help founders find people with the exact background and skills they are looking for. 

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What to include in a salesperson’s contract

There will be certain clauses that an employer will need to include in a sales representative contract.  Possible clauses include:

• Non disclosure agreements to protect company assets and confidentiality 
• Non compete agreements to protect a company in case an employee moves to a competitor 
• Commission and other bonus related clauses in relation to sales benefits 

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Legislate

Legislate can help ensure businesses have clear, legally sound contracts in place. With Legislate, you can easily create contracts that are tailored to specific circumstances and employees such as sales representatives. Plus, our platform allows for easy electronic signing, making the contract process more efficient for your team. Book a demo or sign up today.

The opinions on this page are for general information purposes only and do not constitute legal advice on which you should rely.