Over the next three days, DataFox will summarize the SaaStr 2016 panels. If you miss the tactical theater or strategy stage, are networking on the ground, or didn’t get a chance to attend this great conference, we’ve got you covered.
Special thanks to Jason Lemkin of SaaStr for putting on this conference and giving us the chance to publish these summaries.
Brandon Cassidy, Sam Blond and Emmanuelle Skala, VPs of sales at TalkDesk, Zenefits and Influitive respectively, give advice for founders about to hire their first VP of sales - when to pull the trigger, what characteristics to look for, and how to gauge the new hire’s success.
In a nutshell:
- A VP of sales should be able to recruit, as much as any other function.
- Given the long hiring cycle, start recruiting your VP of sales early.
- Unless the VP of Sales has been doubling down on (and succeeding in) recruiting, he or she should be able to deliver results in one quarter.
When should you hire a VP of sales?
The panelists agreed that you should have enough of a lead volume to make having a sales team worthwhile. It’s hard to entice a VP of sales to build out a team of 10 reps when you only have 20 leads to allocate between them. The consensus was that it’s best to hire once you already have 2-3 sales reps, but before you have 6; until the VP comes on board, the CEO is the de facto sales manager, which is a massive drain on bandwidth and can lead to a mismanaged team.
Though it’s important to make sure your VP of Sales has leads and reps to work with, you should also start the process well before you want to make an offer. Skala noted that the recruiting timeline for senior hires is long - think six months. Start leveraging your network early, says Cassidy, since so many hires are relationship-driven.
What should the VP of sales be doing?
All three panelists say that the VP of sales should be focused on recruiting. But be wary if she’s only bringing in people from a previous company - it’s not scalable, and being able to recruit fresh blood is an essential skill. She should also be able to optimize the current team and define a strong culture. Blond emphasized that a strong VP of sales should be a manager of managers - someone who can manage, as well as recruit, a team.
The panelists had differing opinions on how she should deal with the existing team. Lemkin, who hosted the panel, said that if an underperforming SDR wasn’t gone within 30 days of her hire, she wasn’t qualified. Cassidy and Blond took a more lenient view, arguing that some companies have rigid hiring processes, and team cohesion must be taken into account.
All agreed, though, that she shouldn’t be judged on individual quota, or even quota at the expense of recruiting. Skala argued that she wouldn’t be able to teach her reps anything if she was worried about her own quota.
“I think every deal should be accredited to a rep, regardless of how much the VP of sales carried it." - Skala
In the end, she should be given the leeway to make her own decisions. This will not only give you enough information to decide whether she’s qualified, it will also open the company up to new insights that you (as a founder lacking, presumably, a sales background) would not have discovered.
By what metrics should a VP of sales be judged?
Not assigning the VP of sales a quota, however, doesn’t mean that he won’t be judged on performance. Blond argued that the new VP of sales should be evaluated based on his ability to set a sales strategy and train up his team. Skala, on the other hand, recommended that if he wasn’t able to increase sales by 10% in his first quarter, he wasn’t the right guy for the job - within a quarter or two, the needle should have moved.
“If a metric isn't going up and to the right in one quarter, you've hired the wrong VP Sales.” - Skala
Skala argued that a VP of sales should be held to some metric. Conversion rate, deal velocity, recruiting - whether or not it’s the right benchmark, he should be able to make a significant impact if he devotes his attention to it. If not, that’s a major red flag.
As the sales team grows, he should be able to keep building a great team. It’s possible to make 5-10 hires based solely on an existing network, but once he’s forced to move past that, you’ll get a solid look at his ability to recruit at scale.