How to become a sales-focused founder (and why it matters)

Remember Pebble?

Users loved the original “smartwatches” that could display texts and notifications on your wrist until 2013. But even though Pebble received rave reviews and was years ahead of its time, it fell far short in the one metric that really mattered to him: sales. In the end a great product came to a sad end, although he was sold to Fitbit for just $23 million.

For startups and their founders, this type of product and sales disconnect is surprisingly common. This trend will become even more pronounced in today’s uncertain economy, where customers are spoiled for choice and businesses are forced to live or die by the strength of their sales efforts.

As the founder of three software companies, I learned the hard way that having an effective sales strategy is just as important as creating a great product. When I started my first company, Software His Performance Monitoring Platform, I had an engineering background and was intensely product-focused. (Not surprising given that my total sales experience at the time was selling farm equipment at my father’s store in India.)

Is there a problem with that attitude? As a company begins to grow, sales, marketing, and distribution become as important as the product itself. Even if you make the best TV in the world, if it doesn’t end up on a Best Buy shelf, it won’t last long. Overall, approximately 40% of new product launches fail, so companies need to marshal all their sales power.

Looking back, there were some clear stepping stones on my journey to becoming a sales-focused founder. For other founders and entrepreneurs, especially those new to sales like me, here are his four steps to go from sales skeptic to expert.

Related: 5 tips to master the art of sales and move your business forward

Step 1: Accept that sales actually matter

As an engineer, I never thought that sales could be a competitive advantage. For me, this word conjured up the stereotypical (and inaccurate) image of a floppy-haired guy who’s good at teasing his customers. I know many founders who are in that boat. Sales take a backseat…until you realize your beautifully designed product isn’t selling.

In the early days of AppDynamics, we were all about sales, generating millions of dollars in revenue annually, primarily by winning some big accounts like Netflix. But one CEO pointed out the obvious. If he wants to cross the $100 million mark someday, he needs to get a science on sales.

For me, the important first step was education. If a software engineer can learn programming, so can sales. So I embarked on what amounted to a small degree.

I researched companies similar to mine three to five years down the line. How did the company run its sales process and what types of salespeople did it hire? Relying on experts also helped. For example, I hired John McMahon, a top authority on enterprise software sales, as an advisor for his weekly whiteboard sessions.

For busy founders, this education is a significant investment of time, but well worth it. In one study of 500 B2B companies, the top 25% generated 2.6 times more ROI from sales costs than companies in the bottom quartile. }

Step 2: Build the sales machine

So many companies use great technology to make products, but how often do they stop to answer the important question, “How does our product actually improve the lives of our customers?” there is no.

For us, this became immediately obvious. We tried not to move our heads. Using our software, companies can now monitor and quickly troubleshoot performance degradation—the kind of failures that cause downtime, lost customers, and frustrated CTOs. Once the relationship between product and value became clear, my team and I began to approach the science of building a sales machine.

The first step here was pure mathematics. Let’s say your annual revenue goal is $10 million and the average value of each deal is $100,000. By taking into account your average close rate (for example, 30%) and average closing time (6 months), you can accurately determine how many leads you need in your funnel and how many sales reps you need to get there. I was able to calculate it.

Hiring, training and incentives are equally important. We’ve learned to be quick to part ways with people who aren’t the right fit for the job, and to promote good people just as quickly. Coordination with other members of the company and timing are also important. Are your product and go-to-market teams ready to step up? How much cash do you have while you wait to get the machine running?

If done correctly, the flywheel will start spinning. In one study of B2B companies, companies with rigorous sales processes had an average of 28% higher revenue growth than their peers without them. In contrast, another study found that half of underperforming organizations had a non-existent or informal sales process.

Related: Want to sell more? Don’t start with your product or service, start with yourself.

Step 3: Focus intensely on people (and advocates)

Numbers aside, the essence of sales is people. That’s why I still spend at least a third of my workday chatting with prospects and customers, either in person or via Zoom. This is a powerful way to get product feedback and an even better way to find supporters.

Your advocate is someone inside your company who will fight for you. Promote your product to bosses and decision makers and gain an edge over your competitors. In the beginning, I had a hard time understanding how important it was to have a champion. But without the right relationships with the right people, our proposal had no chance.

It’s not easy for small businesses to find supporters for their products. There are so many decision-makers in large companies that a sale is like passing a bill through Congress. It’s important to develop multiple champions, not just one.

Please choose the appropriate one.

Step 4: Eliminate surprises from the sales process

B2B sales is a long-term game. For large customers, the courtship period typically lasts 6 to 9 months. No one wants to find out that she’s been talking to the wrong person for four months because her contact wasn’t planning on buying or couldn’t greenlight the purchase.

What are some tips for avoiding bombshell statements like this? Don’t take shortcuts. Take the time to identify the true decision makers. Understand their problems (not just yours). Make sure your product meets the buying criteria (even better, help create the criteria, which is the not-so-secret trick to getting most deals). Predict what your competitors are saying to your customers (including what your competitors are saying about you) you.

It may seem like a lot to remember, and you’re right. But online training tools like MEDDPICC and SalesHood break down the sales process into manageable parts. After all, sales consume a lot of resources, and B2B SaaS companies typically spend 35% of their revenue on sales and marketing. Eliminating surprises can lead to big savings.

I’ve built and improved sales machines for three companies, and I’ve found that process improvement never ends. We also learned the importance of hiring a VP of Sales and her CRO experts. Whether my annual sales reach his $1 million, $100 million, or $1 billion, from achieving my goals to finding traps set by my competitors, I was initially distracted and I struggle with the same question. I’m the founder and CEO, and I’m still finishing my sales degree.

Related: 8 ways your startup can master sales and growth