Jason Lemkin has an awesome guest post on his blog by Nick Mehta, CEO of Gainsight, titled The Second-Timers: Nick Mehta, CEO of Gainsight – “Never Stop Hiring Reps”. Nick’s learning #6 is that once the repeatable customer acquisition model is working, Software-as-a-Service (SaaS) startups shouldn’t stop hiring sales reps.
At Pardot, we made this exact mistake. We’d ramp up sales rep hiring, hire a few reps (always hire reps in pairs, if possible), and then six months later we’d be ready to hire more reps. Only, now it’d take a couple months to ramp up hiring again, so it would be several more months before we had our newly desired number of sales reps. Instead, the better approach is to always be hiring sales reps, even if you have to say that the start date is a few months out.
Here are a few thoughts on always hiring sales reps:
- Just like sales reps have a pipeline of prospects, recruiters and hiring managers should have a pipeline of sales candidates
- If the hiring plan calls for hiring a certain number of sales reps per quarter, try and have all the sales reps already signed well in advance to start the following quarter
- Depending on the annual contract value and lifetime value of the customer, if a sales rep can bring in enough revenue, there’s an argument to hire as many sales reps as possible until diminishing marginal returns set in
- Sales reps often have friends that are sales reps, so include referral bonuses for employees to refer potential employees
After product-market fit has been achieved, and the unit economics are proven, SaaS startups should always be hiring sales reps.
What else? What are some other thoughts on always hiring sales reps?