The biggest GTM mistake every founder makes at least once

You have a great product. You have great branding. You maybe even have a great pipeline. But you’re not closing sales. Why?

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You hired the wrong person

Your first sales hire needs to sell. Strategy is not required, and it might not even be nice to have. Because someone who joins your startup to have a big impact on strategy might not want to spend the time it takes to actually close sales. The first sales hire needs to take your direction (even if it’s only 50% right!) and go turn prospects into customers.

That salesperson is probably not going to have any support. Your designers are designing other stuff so they can’t build decks for the salesperson. Your fractional CFO can’t build a basic excel-based ROI calculator. If the salesperson feels like that is necessary, they need to either do it themselves or figure out how to phone a friend (or use Upwork).

There is no “sales engineer” so they have to be able to demo. “But my product is very technical!” you say. Is your actual buyer technical? Perhaps not. But perhaps they are–I’ve worked with companies where the first salesperson had to be hook up a driver (a power tool) to an IOT device and show off the software that controlled it–without ever having done any of those things before.

These are reasonable expectations. Some people thrive in this one-man-band environment. Hire them. Others don’t. Especially ones who are mid-career at big, established companies. Did you know that YouTube’s salesteam has a whole team of consultants people who build decks for them and plan out accounts? Don’t hire them as your first salesperson, even if they crushed their quota.

That salesperson is also probably going to have the whole gameboard flipped over on them multiple times. At YouTube (sticking with this example, but it could be any large company) you’re usually selling the same thing to the same people, over and over. In some cases–like the Up Fronts–there’s a whole, decades-old culture around it with nearly completely standardized contracts. Is that your environment? Or are you going to go from SaaS to services to both to annual contracts to pay-per-use to… you get the idea.

How long should I give someone to close deals?

The specific answer depends on your sales cycle and your business. There is almost no tech business in which 9 months should be allowed to pass without any sales from a new sales hire, and probably for most 3-6 would be enough time.

Every company I joined while I was an employee, I brought in revenue or made some other, obvious and major impact within 30 days. I’ve see much more senior people with (at the time) better pedigrees be in “learning mode” at the same company for 90 days… and never actually close a deal. Even though we had a lot more figured out at that point.

Again–even if it’s your fault, you can’t change you. But you can change the AE. So make the change. And if it is you, why are you paying an AE’s salary while you figure that out?

A list of excuses why not to fire underperforming salespeople

Let’s just get them all on the table.

1. We’ve invested a lot in him and he’ll be hard to replace because he really knows the product.

2. He has key relationships with customers, who might leave if we let him go.

3. He lives in a region we don’t have coverage for otherwise.

4. We didn’t support him enough.

5. We don’t have enough leads.

6. The leads aren’t the right leads.

7. He hasn’t had long enough to have an impact.

8. They might turn it around soon.

9. They’re working really hard / trying really hard.

10. We’re short staffed, so the team will be stretched.

11. They used to be a top performer (here or elsewhere)

12. They fit well with the company culture and would be missed.

13. Optics–it’ll look bad to the rest of the team to let that person go.

14. I don’t want to be a harsh CEO/founder/manager.

15. We need to figure out what went wrong first.

16. We need to hire someone for them to train up before we let them go.

17. The market is tough right now and it’s hard to sell.

18. They’re doing more than just sales (e.g., setting up the CRM, etc.)

19. (my fave) It’s right before the holidays, so it’s a bad time to fire people.

Not only are these all, 100% total and pure bullshit, but many of them are exactly WHY the person should be fired. A few examples:

16. We need to figure out what went wrong first - Most likely is the person, and if they’re around they’ll misdirect you or make it harder to figure out what happened. While they keep burning your cash

17. Hire someone before they go - Don’t contaminate your new, fresh and enthusiastic hire with the under performer who is probably jaded and upset.

18. Market is tough right now - so cut underperforming salespeople so the best people don’t leave and/or to preserve cash!

As for my favorite–it’s never a good time to fire someone! But it’s definitely a terrible idea to pay someone to not work for 2 weeks over the holidays if you are a startup and need to conserve cash. Or even if you’re a mature company.

Keeping under performers around lets other people know (not think–know) that underperformance is ok. I once literally had someone tell me that they weren’t coming in one afternoon because so-and-so hasn’t been fired yet, so it must be fine to not work. True story.

The immediate “You’re Fired”

Excuses, complaining and blaming should result in immediate termination. No PIP. No excuses. Nobody said early stage sales was going to be easy. But someone who is actively grousing–or, worse, insubordinate–should be immediately shown the door.

What if it’s the company’s fault that the product isn’t selling? Doesn’t matter.

It’s a team sport and you need team players. If you want to be LeBron, fine, but last time I checked he doesn’t need to make excuses because he wins.

The prototype early sales hire

My favorite SDR of all time is named David. He applied cold to the job we had posted, but it turned out one of my advisors had previously managed him. His only note was “he works too hard, sometimes. I had to tell him to go home late at night and on weekends, before he got burned out.” Turns out I had the same problem (and he didn’t go home).

David would not miss his quota. I’m not sure why–did he have a gambling problem? It seemed existential, hitting his quota. I remember one Monday, early in the month, he was in early (as always) and he came over to my desk, nervous. It was maybe the 6th or 7th and he confided that he felt way behind, and had canceled a trip that weekend so he could come in both days to send more cold emails.

At the time there were tons of problems with our GTM. But never did he make an excuse. He would sometimes point out why a prospect didn’t buy. But it was never a blame thing. It was never an excuse. Just a statement of fact. Can I go see if I can fix it myself? would sometimes follow.

He came up with crazy ideas. Every cold email was signed “sent from my iphone”. Even though none of them were. People opened those 2x more than they opened ones wtihout that signature.

Once he wrote to a prospect in a free trial–”Noticed you haven’t logged into your free trial yet. If you’re not going to use it, can I give it to someone else?” They wrote back 5 minutes later–right after logging in.

I think David is 1 in 1,000,000. And, unfortunately, no you can’t hire him–he’s now a PM at Microsoft. But that kind of attitude, not only. work eithic but also and perhaps more importantly, the willingness and hunger to just do the work cannot be beat.

Hunting v Gathering

Today, I would argue salespeople don’t need to find prospects. You should only make your first hire once you have enough prospects to occupy a salesperson’s time. Of course, each business is different and there may be good reason why sales people need to generate their own pipeline. I haven’t found that to be the case for SaaS in the current environment. Company generates the interest, the great salesperson can turn someone casually perusing into not only a customer but an evangelist.

But there is a major difference between making a prospect into a customer, and getting a customer to expand. The former is hunting. The latter is gathering. Do not mistake one for the other. They are very different people, and only unicorns are good for both. Unicorns do not, in fact, exist, so stop looking for them and just hire that which you need.

The distraction mistake

Up in that list of excuses is the classic distraction mistake. Your first sales hire who signs up for Hubspot and then watches videos to figure out how to set it up. And misses quota. Or gets Canva and starts designing ads. Or, worse, shows up to the marketing team’s meeting and starts rewriting their copy.

Keep your salespeople focused on selling. Your job as CEO/founder is to remove distractions–not encourage them. Hire someone if you need CRM set up. For anything over a 5-10 minute basic thing, get help. If your marketing team is doing a bad job at copywriting, don’t have your salesperson do their job for them–find new marketers who write good copy.

The micromanagement mistake

Many founders have not managed salespeople before. You need to give them enough rope to hang themselves with, but keep a close eye on them so when they do, eventually hang themselves–no mess gets on you.

Think about it like managing a baseball player–and this analogy works even better if you don’t know anything about baseball. There’s no way you know how to throw a particular pitch better than a pitcher who made the big leagues. Or the ninja-like footwork that separates a major league shortstop from a minor league shortstop. You don’t have to–you can just see their performance, and if they perform, they start. If they don’t, they don’t. If someone wakes up at 5am and works out all day, or sleeps in til noon, and shows up just an hour before the game–all you care about is if they performed.

You can absolutely manage inputs, as a leading indicator for sales success. If, for example, it usually takes 30 cold calls to get 1 deal, and that’s the daily expectation, when someone does 10, that’s not ok. But (to an extent) if that person did that 10 in a way that delivers 2-3 deals consistently–maybe, oly calls at breakfast and dinner time after heavily researching prospects–perhaps you change your expectations.

Leadership hires

Bad hires can also happen in leadership roles. This is devastating, and could cost you $500k. Maybe more, depending on your scale. I say “leadership” broadly, because a CFO or COO can also really hurt sales by, for example, changing pricing or how you service clients. But, obviously, sales and marketing hires leaders are the most dangerous–for three reasons.

First, it can take a long time before problems surface. If a sales leader joins, it might take a long time to see how their changes to your sales process impact your close rates. If you have a 6 month sales cycle, the impact of a change you make now that affects close rates won’t be clear for 6 months. That change could be as simple as what people say in that first sales meeting!

Second, these are humans–there’s no “roll back”. If a leader changes your whole sales (or marketing) process, repositions your product, etc. and is simply wrong about it, do your customers or prospects forget? Perhaps a bit, but not entirely. Moreover, your team doesn’t forget, and now even if you fire that leader–they have to unlearn things. Or you have to let them go also. Which brings up another point–sometimes sales leaders bring their people with them, so if one doesn’t work out you might be gutting an entire department.

Finally, your whole company can lose its confidence–including you. Before, you had just closed your Series A, NRR was growing at 150%, pipeline was full, deals were closing left and right. Then… something wasn’t working. Deals weren’t closing. Your board is yelling at you every month. TechCrunch isn’t asking for updates proactively. It just doesn’t feel good.

Eventually you’ll grow to the point where you need a leadership hire. Be very, very careful. Check references. Control for luck–there are plenty of rocket ship companies where the boosters were firing so well that no CRO could have crashed it. Also be careful of leaders who showed up after someone else set up the processes and infrastructure, and were in the right place at the right time to take the credit.

More resources

Many founders haven’t hired or managed sales roles before. Even people who hire and manage salespeople their whole careers have to fire a lot of salespeople! It’s the nature of the work. Like a great social media post, you can have some idea of what will perform–but you’ll be wrong sometimes. Unlike a social media post, an underperforming salesperson costs you real money, time, and morale.

We work with founders all the time to assess their sales teams and figure out what part of the process isn’t working–is it the salespeson? Or the lead quality? Or something else? If that sounds useful, welcome to find a time to talk. We also work with you on your interview process (even helping out) so you have more success.

Want to level up your GTM overall? Be more confident telling sales what to do? Check out my course coming up on Selling and Scaling Confidently. There are just a few spots left. If you don’t take me up on this invite, I may have to give it to someone else!