When companies, startups in particular, are growing fast, they are often referred to as a ‘hyper growth company,’ or as ‘growing exponentially,’ and as having gone ‘viral.’ Companies like Facebook, Slack, Dropbox, Zoom, or Google come to mind.
Growth comes in many facets and sometimes seems confined, at least in the SAAS world, to growth of users, downloads, or searches, while other verticals look at growth in terms of ROI or EBITDA. All of these are important; they are lead-in or bottom-line metrics, though. However, no matter how defined, all will pay attention to topline revenue growth.
It’s typical for many startups to grow fast in the early stage, with revenue growth well above 100%. As the company matures, though, the growth rates tend to slow down, and 15% to 50% year-over-year growth is typically considered a great performance, still much to the envy of more established companies.
But what needs to happen to achieve this kind of growth?
Some products self-propel based on a mechanism. When users on peer-to-peer platforms invite other users who, in turn, do the same, growth is viral. All products have a word-of-mouth component, but for some growth is primarily driven this way.
Then there are hot trends, products that everyone in a defined market is going to buy, where the ubiquity and inevitability of the trend lead to creating new categories or words like ‘to google’ or ‘to zoom.’ And then there are those products or services supported by government regulations prescribing their use.
While it is every founder’s dream to launch a product that grows simply because of a mechanism, one that practically sells itself, the reality is that most require dedicated focus and investment in marketing and sales activity.
For most products, growth occurs proportionally with investment in marketing and sales.
A few years back, I was part of a startup that had more than 40% of its headcount working in Sales. Add Marketing and Customer Service, and more than half the company was directly customer-facing. This centricity was necessary because of the product, the market, and the growth ambition.
With that in mind, the growth and, ultimately the success of most businesses is dependent on undertaking the right sales efforts. Labels used in this context are ‘best in class,’ ‘high performing,’ ‘rock stars,’ ‘world-class,’ or ‘rain-makers.’ The role of sales in this situation can be viewed without those subjective superlatives, though. Sales simply becomes a competitive advantage, just like product performance or quality. Initially, the sales efforts just need to be
better than those of the competitors. And in the second step, to maximize results, they need to simply be the best.
A good way to get there is to break sales down into the elements of process, technology, and people and then review every part. For example, take a look at all the steps in the sales process and ask what changes or tools will deliver greater overall revenues. Or look at the skills of the people and determine what additional skills will enable them to perform better.
Sales Leadership is the sum of all those actions and qualities required to create the best sales organization to accomplish the growth goal.
Between process, technology, and people, the element often considered the hardest to improve are the people, the sales team. When Founders, Owners, or CEOs comment that they had to hire and fire salespeople because they didn’t perform, or when the average tenure of their first full-time sales leader is somewhere between 12 and 18 months, it often goes back to this very challenge.
The best sales teams are usually diverse, and the individuals have unique and complementary talents, skills, and expertise. The best teams also are a mix of specialists and generalists, hunters and farmers, outside and inside. There is no one-size-fits-all, no blueprint. The most successful sales leaders have the leadership DNA required to work with diverse individuals, build teams, and create sales velocity and growth.
A sales team with the right DNA is the key capital of every company. It is THE competitive advantage.
Capital is defined as wealth in the form of money or other assets owned by a person or organization that is available for a particular purpose, such as starting a company or investing. Capital is a broad term that can describe anything that confers value or benefit to its owners, such as a factory, its machinery, intellectual property like patents, financial assets, or the skill and ability of individuals.
Leadership Capital is the stored value or currency a leader has that enables them to influence the organization or market.
Capital is a finite resource that can be built up over time and stored. It can also be lost to your competitors or wasted if managed poorly. Poor leadership decisions or actions can result in the loss of leadership capital. Experienced leaders build up Leadership Capital and, as a result, are more effective at getting things done. Individuals that have invested in building up their own Leadership Capital are more efficient and effective.
The best, most experienced sales leaders build, retain, and leverage Sales Leadership Capital.
Sales Leadership Capital is the currency of influence based on the relationships, integrity, and trust built with customers and partners. It is necessary to inspire confidence, affect buying decisions, close deals faster, and drive revenue growth.
And it is investment that builds capital. The knowledge and skills that people obtain through education and experience are referred to as human capital by economists. People invest in human capital for similar reasons that businesses invest in physical capital and individuals invest in financial assets—they hope to earn income. And as such, the Return-on-Investment becomes the key metric.
This Investment in Sales Leadership Capital can be made in different ways: by adding experience from the outside, adding skills through training and coaching, or by providing great leadership. In each case, it can be clearly expressed monetarily; and likewise, can the return in topline revenue. Time plays a factor, as some investment vehicles provide a faster return. And so the decision where to invest can simply be calculated and expressed as the lowest investment to achieve the desired growth goal.
Is there an alternative scenario? Does wait-and-see result in growth? Does doing nothing deliver topline results? No.
Growth requires an investment in Sales Leadership Capital.
Our vision is the universal recognition among owners, founders, and CEOs of the need to invest not only in product, manufacturing, and marketing but also in Sales Leadership Capital. The investment will result in growth, and those who don’t do it will be left behind.
At Vendux, we help companies grow their sales leadership capital by matching a company with the sales leader and team necessary to transform the sales strategy, increase revenue and move the business to the next level. Our proprietary PerfectMatch™ system identifies the ideal sales leader matched to the business’s unique requirements with the highest level of precision and assurance to achieve the sales goals.
Our flexible process allows a client to choose a sales leadership model that meets their needs today, onboarding fractional CSOs and CROs, interim teams, or full-time sales resources to scale as the company grows. Ultimately, we help companies achieve sales velocity by identifying and onboarding a sales leader within days, not months, ensuring an efficient and effective path to new customers and revenue.