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Understand the Startup's Business (Part 2 of 3) with handout
Navigating the Decision to Lead Sales at a Startup
When interviewing for a Head of Sales position, it's crucial to ask the right questions to gain insights into the business and lay the groundwork for your first 90 days. While public companies provide extensive information, startups require more digging. This blog post provides a list of important questions to ask during the interview process, helping you understand the company's needs, goals, market position, and more. By asking these questions, you can demonstrate your strategic thinking and assess the fit between you and the company.
When interviewing for a Head of Sales position, utilize interview questions to understand the business while beginning to create a plan for your first 90 days in the role.
People interviewing for a public company have the luxury of reading the company’s 10-K (detailed financial performance report) and listening to quarterly earnings calls with Wall Street. It’s like listening to a podcast with countless golden nuggets about the business.
Public companies are required by law to provide regular updates to shareholders. Startups are not required to do this, so we have to dig in to figure out what’s going on under the hood.
To avoid coming off like you’re grilling the founders or other executives, first ask for permission:
“I have a list of questions that would help me identify my focus areas for the first 90 days of the role while learning more about your business. Would you mind if I asked you some detailed questions about the business?”
Great founders won’t be shy to share information. If they are hesitant to share then they either don’t trust you, don’t consider the Head of Sales a true executive partner, or are embarrassed to share bad numbers. No matter the case, if they’re not willing to share information during the interview process it’s probably not a good fit.
Not all the questions below have to be answered in one call. Spread it out, and don’t rush to get through things. Ultimately these are the people you’ll be spending a lot time with - get to know them!
Questions to ask and understand during the interview process
What do you believe the ideal candidate profile looks like for your next Head of Sales? Listen to what they believe they need from the next Head of Sales and find out if their team actually has alignment around the ideal candidate profile.
What’s the north star of the business for the next 6-12 months? You need to understand what the focus is and why it’s the focus.
What’s the current burn rate of the business? Relatedly, how much time does the business have until it must raise more capital? Remember the Head of Sales is one of the most expensive employees from a cash perspective.
What milestones must be achieved to be able to raise the next round of funding? This is not an easy question to answer in the current macro environment, but try to understand how the founders came up with their revenue and product goals.
What’s the ideal customer profile? Dive into the process of how they discovered their ideal customer profile, what objections are commonly heard, and how many happy customers have been leveraged for testimonials.
What has been the most useful channel in generating leads to your ideal customer profile? This will help you understand the current alignment between marketing and sales, as well as start clarifying the sales motion for the business.
What is the net revenue retention? This dives into expectation setting for sales, customer success teams, and how both departments are aligned.
What is the average sales cycle and annual contract value? This will help you begin creating a framework of the type of sales reps you’ll need to hire as well as dive deeper into how you can speed up sales cycles and increase the contract size.
What percentage of reps hit quota in the last 6 months? Dig into how quotas were set along with current onboarding and training provided to new hires.
How would I get a change to compensation plans or other sales initiatives approved in the org today? It’s critical to understand what the internal decision making process looks like to be able to move the needle as a leader. Many early stage startups don’t have one outside of going straight to the co-founders for approval. Work with founders to begin building this process together.
How was the product roadmap built and what are the goals for the next 6 months? A startup can focus on building a lot of different things for their business. Work to understand the thought process around why they chose to build what they’re building now and with what kind of speed they ship new products.
What’s the moat and competitive dynamic? Many startups don’t yet have a moat, but should have an idea of how their business becomes defensible in the future, and should be able to share the logic behind their target position in the market.
What’s the total addressable market (TAM) and the entry point for sales? Overall you want to be working with a large TAM with a clear entry point that sales can focus on. It’s possible the startup is building an entirely new category and the TAM isn’t yet clear, that’s ok just be aware of that fact.
Many founders won’t have the answers to these questions, and that’s ok! If the company/team satisfies your core requirements and have a few answers to the questions above, along with a vision to be able to answer the other questions, that’s a great start.
As a future Head of Sales, remember: you’re not a passenger on a large ship, you drive progress.
👉 Here’s a link to a spreadsheet (make a copy) with all the questions from the last post about core priorities (Tab 1) and the questions above (Tab 2) so you can take notes as you interview with startups.
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