So we asked a few top practitioners from companies such as Shopify, Terminus, Close and many more to talk about how they\u2019ve built sales teams from the ground up. Taken together, their advice is a blueprint for how to build a modern sales team.<\/p>\n
12 expert tips to build a world-class sales team<\/h2>\n1. Decide on top-down vs. bottom-up<\/h3>\n
Peter Levine, General Partner, Andreessen Horowitz<\/em><\/p>\n I\u2019m often asked the question of \u201cWhy sales?\u201d by entrepreneurs and technical founders.<\/p>\n The \u201cWhy sales?\u201d question becomes even more pressing given the trend toward \u201cbottom-up\u201d product adoption<\/a> \u2013 i.e., offering a given product for free<\/a> or without a formal top-down sales motion, as is common with SaaS. Why not simply invest in hiring more engineers and let the targeted end-user virally adopt the product of their choice?<\/p>\n “A formal sales function promotes the value of a product to an organization in ways that individual adoption and usage can\u2019t”<\/p><\/blockquote>\n The answer is that unstructured, bottom-up, user-generated sales do not unlock the full value of a given product. If you build it, they may come \u2026 but they probably won\u2019t discover \u2013 or take advantage of \u2013 every feature you want them to. Most users view a product only through the lens of their own use, not through the needs and habits of all the users in their enterprise (which is a view someone at the top, such as a Chief Information Officer, is more likely to have). For example, a security or audit feature that is crucial to a CIO might be completely irrelevant to an individual user.<\/p>\n A formal sales function promotes the value of a product to an organization in ways that individual adoption and usage can\u2019t. Sales people can demonstrate the importance of features across the board, including criteria-setting, pricing, and packaging that unlocks more of the value the product is materially creating for an organization. The result is greater penetration into the enterprise, higher product appreciation, and more revenue from a given customer.<\/p>\n This is not to say that bottom-up adoption is bad strategy; quite the opposite. Many great products see exciting initial revenue traction. The number of customers increases, and the dollars per customer correspondingly grow. However, as a product achieves broader adoption, the dollar per customer tends to flatten. This reflects an individual user\u2019s ascribing a fixed value to a given product:<\/p>\n That\u2019s why combining a top-down and bottom-up approach by layering a formal sales function yields the best results. Although a sales organization might seem too expensive, the revenue it will add can far exceed the cost (you want your sales organization to generate 3x its loaded cost). Creating a formal sales organization will help accelerate revenue and product adoption, as well as result in more satisfied customers.<\/p>\n Excerpt from \u201c<\/i>Hire a Head of Sales<\/i><\/a>.\u201d<\/i><\/p>\n Jason Lemkin, CEO, Saastr<\/em><\/p>\n The optimal sales team structure is one that is accretive, where, roughly speaking, each sales rep brings in at least 5x his or her total compensation.<\/p>\n If the average sales rep produces more than 5x the comp she takes home, then:<\/p>\n The sales-driven SaaS companies that are very capital-efficient generally end up at 5x or greater as a ratio of average quota attainment \/ average on-target earnings.<\/p>\n “Sales doesn\u2019t need to be a cost center. It can be, and for at least most of the life of your company should be, a profit center”<\/p><\/blockquote>\n Where you burn a ton of cash is \u201cbuying\u201d sales. Shoving sales representatives into segments where you don\u2019t have enough leads or enough demand. \u201cStarving\u201d reps with too few opportunities. Brutal head-to-head competition in areas you might not otherwise compete.<\/p>\n Buying sales isn\u2019t bad. It works. If you can raise a ton of capital, it\u2019s one strategy for winning and crushing the competition. But whatever you do, make sure you know the game you are playing.<\/p>\n Sales doesn\u2019t need to be a cost center. It can be, and for at least most of the life of your company should<\/i> be, a profit center.<\/p>\n Excerpt from \u201c<\/i>What is the optimal structure of a startup SaaS B2B sales team?<\/i><\/a>\u201d<\/i><\/p>\n Steli Efti, CEO, Close<\/em><\/p>\n A pod model for your sales team creates focused tight-knit groups, or \u201cpods\u201d that comprise team members playing different roles. A pod-based organization is customer centric.<\/p>\n For example, a six-person sales pod would be composed of three SDRs, two AEs, and one customer success rep. Rather than having large teams, you create little pods of specialized roles, and each pod is responsible for the entire journey of specific customers.<\/p>\n Dave Gray, author of The Connected Company<\/i><\/a>, provides this diagram of the pod model: You still utilize the specialist roles of SDRs, AEs, and customer success reps. But instead of having all of your SDRs or AEs compete against one another, pods compete with other pods. Each pod works together to win the customer, and keep the customer happy afterward. They\u2019re more fluid, and come up with ideas independently.<\/p>\n Pods are more modular and flexible than traditional sales teams. Because success is measured by pod, each member of the sales force has a larger, more holistic view of the entire company. Pods build more meaningful connections between people who are working together. It\u2019s perfect for mature startups trying to optimize existing sales resources<\/a> to tap into new markets and verticals.<\/p>\n If you\u2019ve established your market and have significant traction, organizing your teams into pods creates a highly flexible, agile salesforce that\u2019s ready to meet a variety of challenges and pounce on new opportunities.<\/p>\n Excerpt from \u201c<\/i>3 models of effective sales team organization<\/i><\/a>.\u201d<\/i><\/p>\n Tomasz Tunguz, Managing Director, Redpoint Ventures<\/em><\/p>\n If you want to understand how to build a great SaaS sales<\/a> organization, you should read Mark Roberge\u2019s The Sales Acceleration Formula<\/i>. It\u2019s the single best book on the topic.<\/p>\n Mark is the Chief Revenue Officer at Hubspot, a company that has created tremendous success by perfecting the inbound marketing plus sales model. The book is invaluable for every founder, CEO and sales manager because it not only explains how the Hubspot sales team is structured, but why the structure came to be.<\/p>\n The first employee at Hubspot and tasked with building the sales team, Mark developed a structured interview to qualify candidates and correlated the attributes of the best sales candidates. His list surprised me: Is are the five characteristics of people most likely to succeed in Hubspot\u2019s sales teams.<\/p>\n With this knowledge in hand, Mark created a quantitative candidate assessment. Based on the linear regression mentioned above, the scorecard established hiring consistency and enabled the team to grow predictably.<\/p>\n Excerpt from \u201c<\/i>The Best Book on Building a SaaS Sales Team<\/i><\/a>.\u201d<\/i><\/p>\n LB Harvey, VP of Sales, Intercom<\/em><\/p>\n In sports, stacking your team with all-star players doesn\u2019t always lead to a championship. Similarly in sales, hiring prima donna sales people rarely leads to a great sales quarter. Successful sales people care deeply about reaching and exceeding their own personal quota goals, but they care about the company too. How can you tell?<\/p>\n While it\u2019s hard to directly attribute those things to helping hit quota goals, they\u2019ll lead to a better customer experience and a better product \u2013 which, ultimately, are easier to sell. It\u2019s a win-win.<\/p>\n Excerpt from \u201cHiring for sales in a product-led world<\/i><\/a>.\u201d<\/p>\n John Barrows, Sales Trainer<\/em><\/p>\n Passion is the one thing you cannot train. I worked with Jack Welch of GE for a couple of months to get his online MBA program off the ground, and when I started my first company way back in the day, Jack came to Boston to do one of his conferences. At that time, my company had 50 employees.<\/p>\n I stood up and I said, \u201cJack, look. You talk a lot about passion and all this other stuff. When we were five people starting this company, we were all super passionate. Everybody was on the same page. We got to 20 people and everybody was still super passionate. Now at about the 51st person we\u2019re bringing in, it just doesn\u2019t seem that they have the same passion that we do for the business. How do you instill your passion on somebody else?\u201d In front of 1,000 people, he basically told me I was an idiot. He said, \u201cYou\u2019re looking at it all wrong. You can\u2019t instill your passion in somebody else. You have to hire passion.\u201d<\/p>\n “I can teach skill, I can teach technique, I can teach product knowledge, but I can\u2019t teach drive. I can\u2019t teach passion. I can\u2019t teach grit.”<\/p><\/blockquote>\n That flipped my hiring persona upside down. I can teach skill, I can teach technique, I can teach product knowledge \u2013 I can teach all that stuff to somebody who\u2019s willing to learn, but I can\u2019t teach drive. I can\u2019t teach passion. I can\u2019t teach grit. Sales is a brutal profession. You literally get told \u201cno\u201d 99 times, and you have to keep coming back and asking for more so you can get that one \u201cyes\u201d in 100. That\u2019s why one of my favorite interview questions is, \u201cWhat are you passionate about?\u201d I don\u2019t care what you\u2019re passionate about; I care how you describe what you\u2019re passionate about.<\/p>\n For instance, if I asked you that question, you could say, \u201cI really like customers and I really want to do right by them and make sure our product\u2019s a good fit.\u201d Or you could say, \u201cHoly crap. Did you see what happened on Thursday night with the Patriots? They got absolutely smoked. I\u2019m rip roaring pissed-off, but I think it\u2019s a good thing, because you know what? They needed to get knocked down a notch. I still think they\u2019re going 17\u20131 this year!\u201d I don\u2019t care if football has nothing to do with what you and I were talking about; if you describe it in a passionate way, that means you have some sort of fire in you. My job as a leader is to take that passion and connect it to my business so that you can bring a fraction of that to the table when you come work for me.<\/p>\n John Barrows, as heard on the <\/i>Inside Intercom<\/i><\/a> podcast.<\/i><\/p>\n Stan Massueras, Director of EMEA Sales, Intercom<\/em><\/p>\n What it means to be a good salesperson is changing all the time. Ten years ago, being a good salesperson was treated as an art. You had to influence and persuade and be extremely well-spoken. Over the past five years, sales has become more and more about science. It\u2019s all about looking at data and predicting buyer behaviors and patterns.<\/p>\n I think right now a successful salesperson is someone who can do both. Someone who is very articulate, who can create content, can command an audience but who also has a fundamental understanding of modern communication tools like SalesLoft and Intercom. Even though more and more the sales process happens online, and more of the buying process happens before a salesperson is engaged, complex deals<\/a> still don\u2019t happen without people getting involved \u2013 managing the relationships, navigating the buyer\u2019s ecosystem and successfully merging decision makers\u2019 objectives with desired outcomes (not to mention individual career aspirations, personalities, personal ambitions and so forth).<\/p>\n Devon McDonald, Partner, OpenView Venture Partners<\/em><\/p>\n The short answer to that question is that at the expansion stage, the more you can leverage compensation for results, the better off you (and your sales team) will be in the long term.<\/p>\n Commission or bonus-focused compensation plans provide tremendous upside for growth and allow CEOs to truly leverage their people \u2013 all while those people are given ample opportunity to make significantly more money than if their income was largely dictated by a fixed salary figure.<\/p>\n “The idea is to create an environment that rewards urgency and provides upside for over-performers”<\/p><\/blockquote>\n Simply put, if your compensation plan is largely tied to your sales organization\u2019s ability to achieve specific objectives and targets, then everyone will be incentivized to perform the kinds of revenue-driving activities that yield those results. The value that you place on certain performance measures will vary, but the idea is to create an environment that rewards urgency and provides upside for over-performers.<\/p>\n Ultimately, that model won\u2019t just help you appeal to (and retain) A-level sales talent, it will also make it easier to scale because your up-front investment in additional sales headcount will be less expensive.<\/p>\n Excerpt from \u201c<\/i>Creating a scalable sales compensation plan<\/i><\/a>.\u201d<\/i><\/p>\n Elizabeth Cain, Partner, OpenView Venture Partners<\/em><\/p>\n This is my #1 rule in sales compensation. If you don\u2019t take anything else away from this article, take the time to inspect your data and understand the natural buying process of your customer. Do your most successful customers start with a point of contact, land and expand, and add modules\/users\/etc. over time, or do you have one shot to maximize your sale? If you do have a land and expand model, what drives that expansion \u2013 buyer, user or product? Between your data and your team you should be able to come up with a few hypotheses. From there, we recommend talking to your customers and lost prospects to validate.<\/p>\n If the most natural path to a successful customer is to land with one area of your product and grow the account over time, you need to ensure your sales team is incentivized to do that \u2013 do not pay them less for an upsell than you would for a new sale, or tell them they can only upsell for the first 3 months after purchase if you know that will put undue pressure on the buyer. You have to consider the customer experience when writing your sales incentive plan.<\/p>\n Excerpt from \u201c<\/i>Designing Effective Sales Comp Plans: The Dos and Don\u2019ts for Every Sales Leader<\/i><\/a>.\u201d<\/i><\/p>\n Michael Hanna, Revenue Ops Lead, Shopify<\/em><\/p>\n I recommend that you begin laying out your compensation plans by ironing out the base salary and variable compensation for each role.<\/p>\n First, determine the role\u2019s base salary by assessing the following:<\/p>\n The higher for each, the greater the base salary will typically be.<\/p>\n Next, determine the variable comp based on your answers to the following questions:<\/p>\n Here\u2019s an example of where certain sales roles may fit on the base salary \/ variable comp spectrum in the graph below:<\/p>\n Once you have an idea of the total target compensation for the role, you can start determining the base elements that will drive your comp model.<\/p>\n Excerpt from \u201c<\/i>Choosing the Best Sales Compensation Plan for Your Business<\/i><\/a>.\u201d<\/i><\/p>\n Tonni Bennett, VP of Sales, Terminus<\/em><\/p>\n When I was new to sales leadership and onboarding reps, I did a lot of classroom style training and thought that once I shared a concept, my team would be able to absorb it and put it into practice immediately. I mistakenly trained people the way that met my<\/i> learning style and capability, and expected them to know the material intimately right away. But I learned that taking into account different learning styles and preferences is incredibly important in helping sales professionals to retain the information long term, and that repetition of key concepts is vital for long term retention.<\/p>\n “Taking into account different learning styles and preferences is incredibly important in helping sales professionals to retain the information long term”<\/p><\/blockquote>\n I now try to incorporate auditory, visual and tactile elements into my team\u2019s onboarding to meet all three learning styles, and ask new reps how they prefer to process information. Does role-play help them absorb a concept, or is sitting in a room alone reading over notes or talking out loud to the wall more effective?<\/p>\n Every time we onboard, we adjust parts of the onboarding based on feedback from our new hires about how they best retain information, giving them space to absorb the material and to practice in their own way. On top of that, we slowed down our onboarding program, stretching it across a longer period of time to make sure that at least the biggest topics and talk tracks are not taught once, but repeated or recapped several times.Hearing, seeing and taking action on a concept over several days improves new hires\u2019 retention and long term understanding of the material, instead of simply facilitating regurgitation of the concept.<\/p>\n To further reinforce the training, our follow-up materials include a written version of a concept, a video or audio recording of a talk track by a leader, a couple of live examples from the field and then a requirement to execute a role-play or presentation of what the new hire has learned.<\/p>\n Richard Harris, Founder, The Harris Consulting Group<\/em><\/p>\n Efficiency has been the \u201csales du jour\u201d topic of the month for the past 18 months. While efficiency matters and the sales stack is becoming more robust, what was thought of as nice-to-have has become a must-have (data, dialers, email, etc.) Now that we have made ourselves more efficient, people are finally realizing that efficiency is only 30% of the battle. The other 70% of the battle happens in the conversations.<\/p>\n![\"\"](\"https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2019\/01\/inline05.png\")
<\/p>\n2. Find your optimal structure<\/h3>\n
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\nit all \u201cworks\u201d.<\/li>\n<\/ul>\n3. Structure your sales organization for maximum efficiency<\/h3>\n
![\"\"](\"https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2019\/01\/inline02.png\")
<\/p>\n4. Use the sales acceleration formula to build your sales team<\/h3>\n
![\"\"](\"https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2019\/01\/inline01.png\")
<\/p>\n5. Create a sales culture that\u2019s about more than quota<\/h3>\n
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6. Look for sales people who are passionate<\/h3>\n
7. Hire sales people who can blend art and science<\/h3>\n
8. Choose a compensation model – salary or bonus-heavy compensation?<\/h3>\n
9. Align compensation to how your buyer buys<\/h3>\n
10. Determine the base salary \/ variable split<\/h3>\n
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![\"\"](\"https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2019\/01\/inline04.png\")
<\/p>\n11. Design an onboarding process that will make sales reps stay<\/h3>\n
12. Train reps for effectiveness, not just efficiency<\/h3>\n