In my years of working alongside founders and helping them get to market, I’ve noticed a familiar set of common pitfalls that continue to persist.
Here are four of the most common (and how to avoid making them):
Pitfall #1: Channel Partnerships
All too often, founders rely too heavily and too early on channel partnerships as a cornerstone of their go-to-market strategy. While the idea of leveraging a partner’s established customer base is appealing, it often fails to deliver the expected results for early-stage companies.
Channel partners are not obligated to prioritize your product, sales people prefer to sell proven products with a track record to show, and relying on a channel can add complexity to your operations without guaranteeing sales. Most problematically, channel sales disintermediate the founder from the customer.
Early sales is as much about learning as it is about the revenue results. Direct engagement with the market is crucial, especially in the early stages, to gather first-hand feedback on aspects like the reason to buy, value and selling propositions, market messaging, and pricing.
Pitfall #2: Hiring to Solve Sales
A common scenario among founders is the lack of sales background, leading to uncertainty in their own sales abilities. Instead of diving into the unknown, founders often seek to hire sales experts or employ outsourced lead generation firms.
While hiring experienced sales resources might seem like a smart idea, it often proves counterproductive. Founders need to be intimately involved in the initial sales process to understand their customers and tailor their strategies effectively. These critical learnings enable founders to successfully hire and onboard additional sales resources when the time is right.
To understand more about the pitfall of hiring senior sales hires too early, I encourage you to read Mark Leslie’s seminal article, The Sales Learning Curve. What Mark refers to as the Renaissance Rep, we at GrowthX call the Market Developer.
Pitfall #3: Assuming the Sales Team Structure
There’s a growing trend of adopting a more complex sales team structure, namely having separate roles for SDRs/BDRs for prospecting and Account Executives for closing. However, this model may not suit all types of sales processes, especially in the early stages of a startup.
Instead of assuming everyone should have the same sales team composition, entrepreneurs need to assess the complexity of their sales process before determining the best-suited sales structure.
In the earliest stages of sales, a simpler model is almost always more effective and cost-efficient. (See, Pitfall #2 above.)
Pitfall #4: Overemphasis on Scaling
A premature focus on optimizing and scaling the sales process leads to wasted time and money. While efficiency is important, it’s essential to first establish a sales process that works.
Then ensure it works consistently and effectively for the ideal customer audience. Founders should prioritize finding a repeatable and successful sales model before delving into optimizations for scale.
Ignore the generic advice to “move fast and break things.” Instead, adopt a mindset that “slow is smooth, and smooth is fast.”
The key to avoiding these common pitfalls lies with the founders engaging directly with the market, being directly involved in the sales process, choosing the right sales team structure, and focusing on establishing a successful sales model before scaling.
Remember, in the world of early-stage startups, slow and steady often leads to faster and more sustainable growth.