February 3, 2021
The State of Security in 2021
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All early-stage founders experience a similar early stage challenge: they’ve worked their tails off to create a product that is ready for market, but it’s tough to know how to start selling it, especially when you’re selling to developers. Depending on personal prior experiences, sales as a function can feel uncomfortable, but if you ultimately want to increase your company’s value, you need revenue. In this series, 10-year, early-stage sales veteran Nick Beecroft arms founders with an understanding of which processes and tools to focus on first to make early revenue acquisition easier and scalable. In part three of our series on Early Stages Sales Processes, we’ll examine how rethinking how you approach your prospects can help unlock a stalled sales cycle.
Your marketing efforts are putting leads in the pipeline, and you’ve started to pull together a good picture of your buyer’s journey. But something’s still wrong — deals aren’t closing. What’s going on here? It might be time to reevaluate how you’re thinking about your market, and make sure that you’re focusing on the right prospects.
While we could go into far more depth explaining marketing and sales cycles, what approaches are more favorable than others, or even the psychology behind why people buy things, there are 3 questions you can ask yourself (or even the prospect) that will get you more than half the way to a sale.
Should you be going after big fish or little ones? This is a topic that deserves its own article, but let’s cover the logic. First, what is your average deal size: $100, $1,000, $100,000?
Let’s paint a picture for a couple of common scenarios:
Prospect #1: You’ve been talking to this one prospect for several weeks now. Your product seems like a great fit for what they need. Heck, you think you can answer the 3 whys without breaking a sweat. But, they’re still not paying you $. Worse, they’re continuing to drag out conversations with you, wasting your time.
Prospect #2: A prospect comes in, and he loves the product right off the bat. But they’re big — much bigger than your average deal size, and higher $ amounts means a more complex sales cycle. More complex (within a sales cycle) means that more people have to know about and agree to your solution being purchased. While the prospect is excited about your product, they’ve got to get buy-in from a whole range of stakeholders. This can take anywhere from 3-18 months on average.
In either of the above scenarios, it is probably appropriate to go spend your time elsewhere. Are you fishing in the right pond, with the right size fish? The more prospects you turn to customers, the quicker you’ll identify how serious someone is about buying and how quickly they can buy. If you suspect someone is not capable of buying now, you can politely say: “Without an understanding of milestones and timing for completion, I have to spend my time helping other clients.” The beauty is, you’re a top-level executive in a high-powered startup. If anyone has the ability to say stop wasting my time, it’s you!
Using historical metrics, begin to find where you think your sweet-spot is in terms of time vs money for a given deal. If you’re approached by someone too big for you to service, politely decline the request and get back to them when you can. One tactful and honest option is, “I’d like to table this until next quarter when we have the right resources to give you the attention you deserve”.
Once you begin to convert a few leads into customers, it’s time to start forecasting. Forecasting is extremely important. Not only does it help you understand how much revenue you expect to have at a given time, but it heavily influences your annual planning, financing, and valuation. A quick search for “Sales forecast template excel” yields fruitful results.
Use the information you uncover talking to your prospects, leads, and customers to help you make decisions on product direction, marketing decisions, and more. The biggest pitfall here is to not use what people are saying about your company or products to your advantage. Always close the feedback loop between yourself and your customers.
If your marketing activities aren’t driving a reasonable volume of leads to you each month, it’s time to explore outbound sales, where sales begin to fulfill some of the marketing responsibilities outlined earlier. There is a wide breadth of topics to cover when setting up an outbound sales process, which we’ll have to save for a later date.
I hope you’ve learned something new from this series on early-stage sales processes. Those first few sales are always challenging, but by iterating on your process and refining your strategy over time, you’ll quickly be able to hone your model to something that shows real results. To learn more about early sales, I recommend checking out the following resources:
Thanks for reading our 3-part series on Early-Stage Sales Processes! Don’t forget to check out Part 1: Balancing Sales and Marketing Initiatives and Part 2: Shaping Your Buyer’s Journey. Want more lessons in creating a strong sales process? Let us know what sales topics you’d like us to explore next on Twitter!
Nick Beecroft is a seasoned sales professional with 10 years of experience selling SaaS for early-stage-companies. Disruptive technologies and consultative field sales to enterprise-level companies are his specialty. Through proactive problem solving, he helps his clients implement revenue-impacting technology, people, and processes. Outside of the office, he loves scuba-diving and pairing wines to braised meats.