How to Build a Sales Team for Your SaaS startup

How to Build a Sales Team for Your SaaS startup

SaaS unicorns like team message app Slack are so successful partly because they’ve been building a SaaS sales team that kicks ass. Slack captured 3 million paying subscribers and grew to become worth $7 billion in just five years. That makes Slack the fastest growing SaaS company ever!

But how did Slack go from zero to three million paying customers? Like many SaaS companies, Slack has a great product, which enables it to attract and retain a broad user base. But Slack also knows how to reach customers in the right place, at the right time.

There is no mysterious secret to selling. It takes hard work, persistence, more hard work, and an incredible strategy. And rather than aggressive outbound sales tactics, companies like Slack are masters of the inbound sale and word-of-mouth methodology. It’s selling that’s so subtle, it doesn’t even look like sales—which makes sense, as sales is often a subset of marketing anyway.

“When only 2.5% of companies will even take your call or consider using your product, you realize what a numbers game this becomes,” says Tyler Bosmeny, of Y Combinator. That’s why you need a rock solid sales game plan to close those deals.

Investigate a sales strategy

Just in case you’re not in quite the same position as Slack, it helps to investigate a sales strategy for your startup to begin with. Either you’re at the earliest possible stage as the CEO or founder, or you’re at the point in your SaaS company where you’re ready to invest in your first sales hire.

First, be sure you understand the sales cycle and where you should be investing your time, effort, and money. A typical sales cycle looks like this:

  • Prospect: find people who might be a good fit for your product
  • Connect: contact those prospects initially
  • Research: educate your prospects more about your product
  • Present: pitch to your customers in person or as a demo
  • Close: iron out the details before making the sale

Decide on if you are selling high-touch or low-touch SaaS, because this influences how you sell your product and what a typical cycle looks like. Low-touch SaaS will have fewer touchpoints, and end up being more or less self-service. Customers will sign up for your product themselves using your web form. High-touch SaaS will require account management for new prospects, and of course more salespeople.

Pricing should reflect your product’s value, so aim high—high-touch SaaS should be far more expensive than low-touch. Consider how much you’re willing to invest in courting enterprise customers. They will be more costly to acquire, but potentially provide an excellent return on investment for your business. You can of course have different pricing for different product tiers and customer type.  

Consider if you will have a freemium model to reach more users. Ask yourself, how many features should be available in freemium? Will it include ads? Slack rocks at the freemium model because it means many (non-paid) users are already familiar with its software, and can recommend it to others.

“If you can offer a free tier that provides a lot of value, it will naturally help your product to spread much more rapidly,” says Melanie Perkins, co-founder of Canva. Canva is an excellent example of using the freemium model.

And as Tyler Bosmeny has said so eloquently, it really is a numbers game. Consider investing in a referral program for your happiest customers, and building your email list. You can sell to an engaged list when the time is right.

Target your customers

This brings us back to our initial point that selling is actually all about your customers and what you can do for them. Selling therefore requires knowledge of your customers and empathy. “Great salespeople are relationship builders who provide value and help their customers win,” says Jeffrey Gitomer, entrepreneur and Sales influencer.

You should already be aware of things like product-market fit, and have a desirable product on your hands. Now it’s the stage where you need to find physical customers, or at the very least find them in much larger numbers.

Access market research on the best customer base for your SaaS and how to reach them, or conduct some research of your own. Even showing your product to people you know who fit into your buyer personas is better than nothing.

Identify the main platforms where you’ll be finding your leads—and remember that in B2B SaaS the user may not always be the ultimate buyer. Choose the best methods of reaching your potential users, whether that’s an inbound content strategy, direct marketing (PPC, email marketing), referral/word-of-mouth marketing, influencer marketing, or anything else. You will be feeding these leads into your sales funnel.

Learn how to qualify your prospects (turn them into SQLs – Sales Qualified Leads) before you sell to them, as this will reduce the likelihood of churn. Define what a qualified prospect looks like for your product.

Allocate your SaaS sales budget

Decide how you’re going to allocate your budget for sales and marketing. For example, invest in your operational infrastructure with tools like sales software and Customer Relationship Management software. Allocate PPC (Pay Per Click) budget for advertising platforms like Google and Facebook. Decide if you want to hire new staff, or outsource some of the work to a marketing company to keep things more flexible.

Hiring a SaaS Sales Team

Software automation can be kinder to your budget than hiring too many new people in the early days, but there’s only so far that technology can take you. You need at least one person with a broad overview of the whole sales process to skyrocket your customer acquisition strategy.

Find at least partially technically-oriented sales professionals who can answer questions from your customers and follow up on qualified leads. These should also be people who can deal with the intense pressure of driving customer growth. Remember you may be looking for a growth marketer rather than a salesperson, because growth marketing also focuses on customer retention as well as sales.

Investing in at least one highly skilled salesperson or growth marketer to complement your own skillset is the best way forward. Remember that the title of your new role influences the kinds of candidates you attract.

If your startup is still in the very early stages, you might not be able to convince a sales director to join your team. Instead, look for someone with solid sales experience who can potentially progress to management. Working at a startup, they might need need to be comfortable with generating leads, following up, as well as with building a new sales process for your business.

Decide on the role of sales and set objectives

Educate your team members on the importance of sales. Is sales going to be part of marketing? Sales should not be a silo, but should fit seamlessly into the rest of your business.

Articulate where you are in your startup journey and communicate that to anyone involved in sales. Depending on product Lifetime Value, new customers may be self-service or require face-to-face sales. Customers parting with a lot of cash require dedicated salespeople to manage their account, and this makes any sales role your hire for completely different.

Coach your sales staff to represent your brand and its values. They will potentially be in the field representing your company on the front lines, and making a strong impression on your customers.

Salespeople will also be feeding information back to the rest of your team about how potential customers have received the product, and can even advise engineers on recommended changes. Do you need to involve them in any Sprint Planning or Standups if you’re an Agile team? Make sure you find salespeople who will feel confident working in this way.

Set goals for your target revenue growth, lead generation, or new sign ups by a certain stage and decide on a way of measuring your success. Don’t leave your salespeople to flounder with vague objectives.

Your turn to crush it

This post is only a very broad overview of sales for your startup, which is a complex and deep topic. There is so much more to learn about sales for your SaaS product that it can’t possibly all be covered here.

In fact, the Sales process will look different for every startup depending on your industry, product, and customers. There is unfortunately—and happily—no one-size-fits-all. It’s great to take inspiration from companies like Slack, but you should tailor their approach to fit your own needs.

What remains the same across the board is that selling is all about connecting with your customers, and giving them what they need. Find the right methods to communicate with customers in the way will resonate the most.

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