The Five Sales Mistakes Most Startups Make

Updated: March 15, 2011

Mistake #1: Hiring a VP of Sales first. If you're the founder or CEO of a start-up, the first head of sales is you. The first salesperson is you. You need to lead the charge to determine 1) what the customer is looking for, 2) what they're interested in spending money on, and 3) what the sales process will look like.

Your next hire should be salespeople who hit the phones and have a quota. You need people that will sell first. Only then, when you've established market demand and the start of a successful sales process, should you think about hiring someone to lead. A good VP of Sales will want to build a team. And when you're in start-up mode, just starting to sell and learn, you're not quite there yet.

Mistake #2: Spending money on marketing too early. When you first go to market, you may have educated guesses (based on your customer insight, smarts or past experience) on what sales & marketing channels will work to efficiently drive qualified prospects and closed business. But your first few months will include a lot of learning, a lot of failures, and a lot of improvements if you're carefully executing and measuring everything.

Despite your aggressive early sales goals, don't throw excessive marketing dollars against channels that are unproven. Don't scale spending in any direction until you have measurable proof that your message, offer, channel and/or overall approach is working. Instead, test frequently, quickly and then invest in channels with far greater success rates.


Mistake #3: Building a sales process that doesn't map to how your customers want to buy.
The sales process you used at your last job is interesting, but may not apply to this market, this product, this customer. You can't build an effective sales process in a vacuum.

Successful sales processes mirror the way your customer wants to buy. It takes into account the stages they go through to develop the need, understand and prioritize outcomes, and then research solutions before a decision is made. Each customer navigates this process differently.

And if you create a sales process that conflicts with that, you're introducing friction to the decision-making process that will distract or annoy your prospects, and impact your conversion rates. Even worse, you'll likely blame results on the wrong factors and further delay sales process improvement.

Mistake #4: Selling beyond the early adopters. In every market, there's a different between the early adopters and the early majority. They think different, work different, and buy different. Long-term, you have your eyes past the chasm to the bigger market opportunities. But you won't get there until you address the most ready-to-buy prospects.

Your sales process for early adopters may be very different than what it will look like two years from now, when you're selling to a more mainstream audience. The marketing channels and messages you use may be different as well. But in the early days of selling, stay focused on your most-likely-to-buy audience. They're the key to growth.

Mistake #5: Building a large sales team too quickly. This lesson should be obvious by now, based on the mistakes above. Your forecast spreadsheet may show that you need 10 inside sales reps in three months, but unless you're clear on what they'll be doing, clear on the process they'll follow, where they'll get leads, and what characteristics you need from them to succeed, you shouldn't be hiring to scale. Not yet.

You may not even know if they should be an inside sales team, or field/territory-based. Or maybe it's best to sell purely via channels. It's time-consuming and expensive to unravel a sales organization you built too quickly without understanding the proven dynamics of growth in your market.

Featured Research
  • 2017 Business Intelligence Trends

    It's long been thought that business intelligence (BI) could only be utilized by highly trained analysts and was therefore unattainable for most businesses. However, advancements in BI have made it so that everyone can utilize BI solutions to help shape business decisions and drive companies bottom lines. more

  • Your Phone System and Your Bottom Line

    Businesses have been using phones to drive increases to their bottom lines for almost a century now. Telephony, much like the rest of the business world, has seen drastic changes with the increase in technological advancement. Voice Over Internet Protocol (VoIP), has enabled companies to connect with consumers at levels that have been seen as unheard of before. And trust us when we say this, it is doing wonders for the bottom line. more

  • How to Scale a Contact Center in 2017

    Are you on the fence about scaling your contact center and not sure how or whether or not now is the time? Studies have shown that 93% of executives expect that contact volume will remain constant or increase within the next two years. This means that now more than ever is the time to begin scaling and we are here to help. more

  • Making the Case for a New CRM

    Did you know that having an outdated CRM is just as bad as not having one at all? Do you find yourself working even just a little too hard to make your current CRM work to maintain your contacts and relationships? While it is increasingly more difficult to reduce customer churn, modern CRM tools are much more powerful and provide much more opportunity to develop stronger relationships with your clients that can provide more stability and revenue to your company and bottom line. more

  • 2017 Phone Systems Checklist

    As you are well aware, we are living in an age of extreme technological growth. With this, an understatement might be that phone systems have changed a bit over the last decade. If you are in the market for a new phone system, it is absolutely essential for you to have knowledge of this vast sector and just what exactly you need in order to have your business succeed. more