As you start scaling up a business, and are looking for repeated sales — or retainers, big deals, whatever play you are after — one of the main questions is always: Do you start hiring salespeople full-time, in-house … or do you outsource at first and then maybe bring some of the outsourced team in-house or start hiring after the outsourced team has had success? What’s the most logical idea? We endorse outsourcing, especially for new markets, new product-market fits, attempts at scaling a business, etc. It makes more sense initially, largely because there are a lot of flaws and biases to hiring someone full-time, in-house. What are those? Glad you asked.
Some of the biggest flaws of hiring in-house
- The candidate may be lying: Candidates have been lying on resumes probably since the Neanderthals, and we are not very good at vetting resumes because we often have an immediate need and want to get someone working. So if a candidate says he did $20M in SaaS sales for {place you’ve never heard of ever}, that might not be true. You might be bringing in someone with no real skills — or relationships.
- The system won’t be in place yet: With early-stage or new product sales hires, a system needs to be in place involving SDRs, BDRs, lead generation, content, funnels, social media, templates, etc. If you are just hiring sales principals but they have always worked in places with process and structure in place already, they will fail in a new product-market fit situation — because the system won’t be there, and their previous success is probably largely tied to operating within an already-efficient system. Don’t expect a seasoned sales executive (age 50+) to do cold calling.
- Beware the “big network” sales guys: This is going to lead to relationship-driven selling. That works for a while, and you will feel good about initial results. But what happens when the relationships are tapped out? Can the person sell beyond their network? If they can’t, you will hit a ceiling. Soon.
- Hiring people like you: Your total addressable market is likely not entirely like you, so you need sales positions that look, act, sound, and are different than you are. This gives you greater coverage into multiple accounts and deals. We all prefer things similar to us, which is a bias that creeps into hiring for any position. It won’t set your sales function up well, though.
- Beware the “big swinging dick” hire: You get a chance to go after a big name in your geographic area for a big compensation package + commission. You do it. Here is the dirty little secret of many who do consultative, high-ticket B2B sales: they do not work 40 hours/week. They work on relationships and scripts/templates that have served them well. You may get a few big deals out of it, but you are not getting value for your money with these hires, even though many executives just look at deal size and think “This is a steal!” It’s not, because that consultative, high-ticket guy might have worked 10 hours on that deal. You could be giving away less in terms of compensation.
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So why would outsourcing be better?
Typically with outsourcing you get a pre-established system, and you get people on the outsourced team that know the market and can follow the system with real KPIs. And, for a retainer cost, it’s much cheaper than hiring someone full-time. Basically you get a built-in system + people that can work the system and close the deals, but you pay less. Who wouldn’t want to try that? Here’s what we offer, for example.
