Founder-led sales can be a powerful approach for startups (and some small businesses) to achieve early traction, validate their product or service market fit, and build strong customer relationships. While it comes with challenges, the benefits often outweigh the drawbacks, making it a critical phase in a new company's growth journey. As the business grows, transitioning to a dedicated sales team will be necessary to scale operations and sustain growth.
How do you implement a founder-led sales strategy, and when should you move to start building a sales team? Read on to find out how to know when its the right time for your business,
Key Takeaways
- Founders have unique advantages as the first sales rep for an early-stage startup or a new small business
- Founders excel as middlers, as in handling the middle of the sales conversation
- Once a founder has closed at least ten customers and is spending about 20% of their time on sales, it is time to hire sales reps
- The first sales rep hires should be people you would want to buy your product from
- Founders should avoid hiring a sales leader or VP until two reps they've hired are meeting their quota
What is founder-led sales? A short definition
Founder-led sales is a sales methodology that leverages the unique experience, skills, and insights of a company's founder to sell its products or services. This methodology is most commonly used in early-stage startups, both before a sales team is formed and during the early days of working with the sales team.
If the company has a small sales force, the founder may still lead sales conversations at multiple stages of the buyer journey.
Why adopt a founder-led sales approach?
There are a number of reasons why a founder-led sales approach might be the right fit for your organization. The founder is usually the person who sees a problem for the potential customer base and sets out to solve it. This makes them uniquely positioned to go out and connect with prospects. But it's really much deeper than that.
It’s critical to finding your product market fit
While it's great to have a product or service that solves a problem for a group of people, the beginning of a startup journey is really about finding that product market fit. This allows the founder to connect directly with potential and early customers to confirm that the product or solution they're selling actually solves the problem correctly.
For example, a product may solve the right problem but not in the right way, so the founder may be able to glean insights from these early conversations and course correct the product roadmap, thus growing their total addressable market instead of flopping.
Founders have a unique advantage when it comes to selling
As a founder, even if you're not an experienced salesperson and a lot of sellers aren't, there are a lot of valuable insights you bring to sales conversations. Jason Lemkin, an experienced founder and the CEO of Saastr, speaks about this on an episode of Lenny's Podcast. He says, "So what's important is even if you don't know how to do outbound, even if you don't know how to send a cold email, even if you don't how to do any of this stuff, and even if you don't know how to ask for a check, even if you don't know how to open or close, almost all founders are A+ middlers."
And to be clear about what a 'middler" is for those unfamiliar with the term, Lemkin defines it as the middle of the (sales) conversation. He confirms that it means that you're not initiating or closing but you can have a good conversation in the middle. He even doubles down to confirm that he feels that most sales reps are terrible middlers.
He goes on to say, "You can be 10 times better in the middle than any sales rep at your bigger competitor. If you're running, I am just making up CRM, but if you're running a new CRM startup, you can run circles around 98% of the sales reps at Salesforce or HubSpot."
Proximity to the customer is crucial
Another case for founder led sales is that it gets you, as the founder (or your founder if you're working in a startup) closer to your customer. By spending time in their world, hearing how the offer is landing, and making adjustments based on what is working and what isn't you can speed up your sales growth when you are ready to start hiring some sales reps.
To quantify this, later in his interview with Lenny Rachitsy, Jason Lemkin advises that 20% of a founder's time should be spent speaking to customers at a minimum. If you're not at product-market fit yet, he advises that the percentage should be even higher.
How to get started with a founder-led sales playbook
Build a target customer list
You've got to start somewhere! Do some research to round up a list of prospective customers and start picking up the phone or reaching out to get a meeting with each of them. If you're not quite right about whether a prospect is a fit or not, keep learning and adjust your prospect list as you go.
Start meeting with prospects
You can't adjust your strategy until you meet and build relationships with your prospects. Now, you're getting to know them and learning more about their needs and goals. In the next step, you'll discuss how your solution can help solve their business challenges.
Craft a compelling offer
After spending some time getting to know your prospects, it's showtime. You'll want to start putting offers in front of them for feedback. If you're getting too many easy yesses, your pricing may be too low. If you're getting crickets, you'll want to dig deep to understand why. Maybe your offer is too expensive, maybe your product is still lacking critical features and you need to go back and re-prioritize your roadmap. However, understanding why something is or isn't working at this point could be more important than the actual results. If you know why something works, it's easier to repeat; if you know why something doesn't work, it's easier to adjust or pivot.
Ask for feedback regularly
I know I already said this but it's so important at the early stages I am going to say it again. Get as much feedback through your sales process as you can. Ask questions, send follow-ups, and dig deep to get as much feedback as you can as quickly as you can. At this early stage, feedback is the most valuable gift anyone can give you.
Lean on mentors or ask for help if you feel stuck
Friendly reminder: it's called founder-led sales, not founder-alone sales. Even if you're leading this charge (and you should be), you do not have to go through it alone. Sales can be really challenging, with rejection coming at you fast and furious. People won't call you back; you'll hear no more than yes. It can feel like a lonely slog some days. But, when you hear those yesses, you will be on top of the world.
All of that to say, that on the days where it feels like nothing is landing well and if you don't hear something positive soon, you're going to toss it all away and run off to Bora Bora to sell fishing lines, lean on your network for support. Call a fellow founder. Reach out to a mentor or a friend. People will be here to help you through the journey. So, while it's important that you lead sales at this point, no one expects you to do everything without any support.
Learn from your successes and failures
In the early stages, it's all about learning. So, debrief after every deal. Think about what worked well and what you want to try in the next round. This is how you get better and pick up sales velocity.
When is it time to hire a sales team?
The answer to this question may vary from startup to startup, but Jason Lemkin advises that founders should wait to hire their first salesperson when they have closed the first ten customers and spend more than 20% of their time on sales.
And when it comes to hiring, he doesn't advise starting with a sales leader or VP. He says to start with two sales reps. When interviewing for these critical first sales hires, he says, "Don’t be swayed solely by impressive resumes or acronyms; instead, seek out those individuals who you would personally buy your product from."
Why two sales reps instead of just one or a sales lead? Having two sales reps gives you the ability to A/B test. You can see what is working and what isn't. Then, once you get to a place where you have two sales reps who are both hitting quota and closing deals before you hire a manager for them.
Example of founder-led sales in action
Don't just take our word for it (or Jason Lemkin's, but I would listen to everything he says). There are some great examples of founder-led sales happening right before your eyes. These founders are out selling and actively sharing their experiences on platforms like LinkedIn and X.
Lattice
According to Business Insider Senior Correspondent Melia Russell, "Jack (Altman) has built Lattice into one of the most valuable startups in the human resources space. The pandemic spurred a surge in demand as employers grappled with a changing workplace, catapulting Lattice from a luxury to a service seen by some people leaders as essential. In the heady days of 2021, Lattice tripled its valuation to $3 billion in a $175 million funding round."
At the end of 2023, Altman stepped back from the CEO role and handed the reins over to Sarah Franklin.
Champify
Another great example of founder-led sales is Champify. Their CEO Todd Busler is a great example of a founder leveraging LinkedIn to promote and sell their solution. On the founder-led marketing podcast, he shared that a lot of their sales come from inbound referrals, but there is an outbound motion he is conducting through LinkedIn. He posts content like the post below to share knowledge and connect with prospects:
Final Thoughts
Whether you're an early-stage founder or starting to build a sales team, a founder-led growth strategy might be appropriate for your business. Remember to seek feedback early and often and consider playing the 'middler' role and helping your sellers in the middle of the sales cycle.
If you need to free up some of the time you or your sales team members are spending creating or editing sales documents, Qwilr is here to help you get your message out faster. We offer the ability to create and share templates for many types of sales content that are easy to customize and share, even if you've never officially sold before. Want to see it in action? Book a demo to see how Qwilr can help you scale your startup or raise much-needed capital.
About the author
Marissa Taffer|Founder & President of M. Taffer Consulting
Marissa Taffer is the Founder & President of M. Taffer Consulting. She brings over 15 years of sales and marketing experience across various industries to a broad range of clients.
Frequently asked questions
Founder-led growth is a methodology where the founder of a company leads the sales or growth strategy. This is critical in the early days of the business to find or confirm product market fit and allow the founder to continue to have proximity and exposure to early customers.
The benefits of founder-led companies are finding product market fit and being able to get feedback from early customers in order to scale more effectively. The founder may still be involved in sales after some of the early sales team hires are in place.
