Dear SaaStr: What Are The Best Ways to Transition From The Founder-Led Sales Stage?
Transitioning from founder-led sales to a commissioned sales team is a step almost all of us get at least partially wrong 😉
A few thoughts on how to approach it:
1. You Never Get to Leave Sales. No Matter Whom You Hire in Sales.
Founders are often the best salespeople early on because they know the product inside-out, they’re passionate, and customers love talking to the CEO. You need to close your first 10-20 customers yourself to deeply understand the sales process, objections, and what resonates with buyers. This is non-negotiable—even if you hate sales.
But after closing 10-20 customers yourself, it’s time to get help to scale and start hiring your first 2 sales execs. The transition typically happens when you hit ~$1M ARR or so or when you can no longer handle the volume of leads yourself. If you jump too early, you risk hiring sales reps who flounder because the process isn’t defined yet. You need to at least prove deals can be closed before you bring in anyone to close more of them. And them you need to prove a few reps can hit quota before you bring in a head of sales to manage them and scale it up from there.
2. Hire Two Sales Reps To Start, Not One. And Get Them Both Hitting a Basic, Sustainable Quota Before You Hire a Head of Sales.
This is a classic mistake. If you hire just one rep, you won’t learn nearly as much. You need to compare performance, identify what works, and iterate on your sales process. One rep might excel at outbound prospecting, while the other might be better at closing inbound leads. This gives you a baseline to refine your playbook and figure out what kind of salesperson thrives in your business.
And if you can get 2 reps hitting quota, then you’re ready to hire a head of sales to not just manage them for you, but to take those learnings and hire reps 3-300.
3. Document the Sales Process
Before you hand off sales, you need a repeatable process. This includes:
- Ideal Customer Profile (ICP): Who are you selling to? Be specific.
- At Least a Basic Playbook: What’s the step-by-step process for closing a deal? Include scripts, objection handling, a proven demo, and key metrics.
- CRM Setup: Use a CRM like Salesforce or HubSpot to track leads, deals, and pipeline. If it’s not in the CRM, it doesn’t exist.
Without this foundation, your sales reps will struggle to replicate your success. Or at least, if you aren’t going to invest here before your first reps start — work on these together their first week when they do start. You can’t just abandon them when they start 😉
4. Hire the Right First Sales Reps. Folks You’d Truly Buy From.
Early-stage sales reps need to be scrappy, self-sufficient, and comfortable comfortable working in an unstructured environment. They’re not just closers—they’re hunters who can generate their own leads and figure things out as they go. But that alone isn’t enough. They also have to be folks you’d honestly, truly buy your own product from. Otherwise, you’ll never trust them with the leads.
-> Look for people you’d personally buy from and who align with your company’s culture and values.
You can hire folks from all different backgrounds to work for you directly in sales. But they have to, have to be folks you’d honestly, truly buy your own product from. Otherwise they never work out.
5. Compensate Relatively Generously. Commission is Only Paid if Earned, After All. And Reps Have to Eat.
Early sales reps are taking a risk by joining a startup, so you need to make it worth their while. Offer a competitive base salary and a commission structure that rewards performance. A typical split is 50/50 (base/commission), but make sure the OTE (on-target earnings) is compelling enough to attract top talent. And no need to be too cheap here. If they don’t work out, they won’t earn much commission and they likely won’t stay long, anyway.
And the first reps may not care that much about equity, but care for them. Give them 2x-3x what you’d give a rep later. Maybe even more if then end up doing amazing things. So many B2B leaders started off with a magical sales rep. Get her more equity.
6. Empower Your First Sales Leader
Once you’ve hired a VP of Sales or Head of Sales AND they’ve proven they can level things up — then trust them to build the team and process. A great sales leader will hire a diverse team with complementary skills and let them play to their strengths. Your job is to support them, provide resources, and stay out of the way—unless something’s clearly broken. But they do have to put points on the board. If they can tilt the curve and increase sales quickly, then give them a lot of free space to do it their way. If they tilt the curve.
7. Give your sales leader, and your individual reps before you have one, a quota on your time and meetings per week.
Let them know you expect them to drag you into say at least 4 customer calls a week, and you expect them to use those 4 chips. This will empower them to bring their top deal aide into their top deals.
8. Give New Reps A Sales Cycle or So To Prove Themselves. But That’s About It.
The first version of your sales team won’t be perfect, and that’s okay. Use the early months to refine your process, adjust compensation plans, and learn what works. Pay close attention to metrics like conversion rates, deal size, and sales cycle length. If something’s off, dig into the root cause and fix it.
Note that reps do need to scale in start-ups, and often, mostly on their own. But not everyone will have a great first month or two. Give it a sales cycle before you make an initial assessment. At least if they are giving it 110%.
Some great reps will crush it the first week. Some will need a month or two. But in a start-up, they have to put points on the board in one sales cycle. Or they never really do.
9. Stay Deeply Involved
Even after transitioning day-to-day sales, founders have to stay close to the process. You never get out of sales. You need to continue to join key sales calls, review pipeline reports, and talk to customers. Your insights will help refine the strategy and keep the team aligned with your vision.
10. You Never Get the Time Back. Don’t Expect To.
Assume you spend just as much time in sales & with prospects and customers after you build a sales team as before. Your time will just change to more of a “middler” than an opener and a closer. You’ll get pulled into deals instead of leading them. But you won’t get any net time back as you scale. Because there will be more and more deals.
The transition from founder-led sales to a commissioned team is a pivotal moment in scaling your business. Done right to ensure alignment, check in regularly with your sales leader to review progress, challenges, and opportunities. If they’re hitting their numbers and building a strong team, give them room to run. If not, address issues quickly before they snowball.
