Conversation Framework for Founder-Led Sales with Christopher Philipiak

The first million dollars in sales is a function of the product rather than the sales effort.

Whether you’re developing a service or software, the initial stage involves customer development interviews. These interviews play a crucial role as they aim to transform hypothetical customers into actual revenue-generating customers.

This transformation marks the completion of a successful customer development process. This process allows you to form and validate hypotheses by seeking payment for your product. Typically, beta users morph into paying users, who then refer you to other companies. This ripple effect leads to expanding your customer base, painting a picture of the early sales growth trajectory commonly seen by founders.

Identifying Your Market: The Founder’s Role

As a founder, ensuring that you have customer development conversations is paramount. These conversations are necessary to identify your market accurately. You need to establish who your ideal customer is, what problems they face, what solutions you can provide, and what results you can deliver. Furthermore, you must prototype the necessary systems and ensure a steady cash flow to make the required investments. In achieving this first million, the founder proves to be the most capable and impactful individual.

In the journey from zero to one, numerous elements are required, such as documentation, product changes, bug fixes, and new builds. As a founder, adding more layers or people to the process leads to an increasing degree of insulation from the actual customer. Yet, in these early stages, staying as close to the customer as possible is crucial for success.

The Early Selling Days: Market Research and Offer Crafting

The early selling days often involve more market research and offer to craft than actual sales efforts. This focus is particularly true for bootstrapped startups, which need to maintain a steady cash flow. For venture-funded startups, the approach might be slightly different.

Your conversations should primarily serve as marketing dialogues, even when you’re not explicitly aiming to sell. This approach ensures that your sales conversations, particularly in the early stages, serve a dual purpose of marketing your product and understanding your customer’s needs. Ultimately, viewing sales conversations through the founder’s lens reveals the profound role these interactions play in a startup’s journey to its first million in sales.

Founders Should Be Selling Up to One Million Dollars

Founders should take charge of sales until the business generates up to a million dollars in revenue. However, this approach can depend significantly on the nature of the business and its overall growth ambitions.

As a founder or CEO, you may find value in hiring staff to relieve you of low-value tasks and activities. This move should ideally occur before your business hits the million-dollar mark. A support team lets you focus on more strategic tasks and drive revenue growth.

Consequently, your second hire should ideally be someone who can handle client delivery and service. This team expansion allows you to focus more on strategy, team building, and high-level business development activities.

The question of when to onboard a sales team can be tricky. The decision isn’t as much about a revenue threshold as it is about the business’s foundation and growth aspirations. From Christopher’s experience and discussions with several founders and CEOs, he’s seen founder-led sales organizations scale up to $40 million. This scale proves a founder-led sales effort can generate significant momentum and revenue.

Personal Sales Journey: From AE to Building an SDR Team

My personal journey at Predictable Revenue began with holding onto sales until hitting a million in revenue, after which I hired an Account Executive (AE). I had previous experience as an AE and a sales manager, which made training and onboarding the sales development team a low-risk activity for me.

It might be beneficial for a founder to delegate lower-order tasks, allowing you to focus solely on the closing role. An SDR can book meetings, handle inbound and outbound activities, and become your next AE.

Timing and Profitability: When to Scale Up

The decision to scale up depends on the speed at which you want to grow and the nature of your business. There will be a point when you must decide when and where to allocate your time best for the business’s growth.

This investment might seem unprofitable in the short term, but if it allows you to elevate your role within the company, it’s worth considering. You might observe a small decrease in certain metrics initially. However, by focusing on other tasks that will move the needle, you can ensure a net benefit in the long run.

Balancing Revenue Growth, Customer Conversations, and Team Building

A founder always plays a pivotal role in driving business revenue. Stepping away from the sales component of a business doesn’t come without its set of challenges.

Christopher Philipiak identifies three main hurdles founders often face:

Market Fit: The Core of Sales Success

The first challenge lies in customer discussions. For a salesperson to be successful, there must be a clear understanding of the market, the problem at hand, the solution offered, and the expected results. Without these elements dialed in, no salesperson can achieve sustainable success. With their experience, knowledge, and status, the founder is best positioned to articulate these areas. This becomes particularly crucial when the product or service being sold isn’t fully packaged or built out.

Sales System: Enabling Effective Conversations

The second challenge is setting up systems that enable consistent and meaningful sales conversations. If a salesperson is brought into an environment without adequate support or enablement, they will likely struggle to meet expectations. This struggle is particularly true for those who don’t have a long history in sales. Having the right system can make or break a sales team’s success.

Business Growth: Making a Profitable Sales Team

The third aspect to consider is the company’s willingness and readiness to grow. Building a sales team requires substantial investment. Salespeople, especially good ones, can be expensive. To justify this expense, the business needs to be able to absorb the cost and still remain profitable. For many businesses, this means achieving significant growth – perhaps a couple of million dollars in revenue – before they consider building a full-fledged sales team.

One of the potential pitfalls during this transition is that the founder or CEO may ease off on their involvement in sales too soon while the new sales organization is still being established. Creating a successful sales team can be a multiple-year endeavor, despite the popular desire to achieve it in six months. This is a commitment that must be considered seriously.

The Art of Nurturing: Patience Pays Off

Sales are rarely an instantaneous process. Customers may reply to an email or take a meeting, but making a purchase can take time. Statistically, only a few potential buyers will be ready to commit immediately.

This slow burn is where the value of outbound efforts often shines, though it’s often overlooked due to the lack of a good nurturing process. A proper system to nurture potential clients over the long term can provide great value. Customers may return after 12 or 18 months, or even longer, ready to commit to a purchase.

“These things take time… You can get people to reply to an email, you can get them to pick up the phone, and you can get to take a meeting, but you can’t influence when they will be ready to make a purchase decision. And just statistically, there’s only a certain number of people that are going to be ready to buy right now.” – Collin Stewart

Understanding the importance of nurturing potential clients, investing in a support system for sales, defining your market fit, and being ready for business growth are all vital aspects for founders to consider in the sales process. Above all, remember that these processes take time, and patience can often be the key to unlocking long-term success.

Building a Sales Ready Organization: A Systematic Approach to Drive Revenue

Creating a business that can profitably generate and manage sales conversations requires a robust foundation. This foundation comprises two fundamental systems: sales-ready people and a sales-ready system. Together, they form what Christopher refers to as a “Sales Ready Organization.” This framework not only provides a clear and structured approach to driving revenue but also minimizes waste in the process.

The significance of a framework for revenue-generating activities cannot be overstated. It prevents the creation of components that do not contribute to revenue, thus eliminating waste from your process. Part of my work with clients is assessing their systems. I often find unused or ineffective systems that, once removed or improved, can lead to more revenue with less sales effort. The other aspect of my work involves performing some of the sales tasks for them.

Over the years, businesses tend to accumulate clutter – systems, processes, and practices that no longer support their growth and direction. Clearing this clutter and establishing the right foundation for their future is a critical part of becoming a sales-ready organization.

“It’s like a race car… If the race car doesn’t have a steering wheel or a gas tank, you’re going to have pretty bad day as a race car driver.” – Christopher Philipiak

Five Core Systems of a Sales-Ready Organization

When it comes to being a sales-ready organization, Christopher states there are five core systems to focus on:

Mindset: This element is often overlooked because of its seemingly intangible nature. However, in sales, having the right mindset is essential. Our preconceived notions about money and strangers can significantly influence sales effectiveness. Coaching to improve the sales mindset is paramount.
Leadership: This involves defining your goals and setting up a system to track and report on progress.
Marketing: Here, we focus on how to generate and manage conversations with potential customers.
Sales: This system encapsulates the strategies and processes involved in closing deals.
Project Management: While not directly tied to revenue generation, project management is vital. It ensures the smooth operation of all the other systems.

These systems are predominantly concerned with revenue generation and do not delve into client delivery.

Interestingly, businesses often overlook project management in the context of sales. Depending on the maturity of the business or entrepreneur, sales may not be viewed as an ongoing project. However, like any other system, your CRM or revenue operations require continuous improvement and active management.

Sales, as a whole, is a system of systems. If even one component is missing or not functioning well, it can severely impact the overall performance, much like a race car without a steering wheel or gas tank. Therefore, it’s vital to understand what’s working well in your organization, what needs improvement, and what’s missing altogether. A sales-ready organization framework provides this understanding, enabling businesses to set up and manage their sales effectively.

You need to have the right people to do the work, then you need the right process to enable the people, and then you need the right technology to enable the process. That’s how it stitches together. – Collin Stewart

Core Components of a Sales Conversation: Shifting the Focus from I-Centric to Buyer-Centric

As a founder, understanding the key components of a sales conversation can be a daunting task, especially if you don’t come from a sales background. In their excitement, most founders are eager to showcase the product they’ve built, much like a parent introducing their newborn baby. However, this perspective needs a significant shift.

There’s a common misconception around the purpose of a sales conversation, stemming from a deeply ingrained ‘pitch culture.’ We are taught to create something and then pitch it – but this isn’t how B2B businesses actually sell. It’s crucial to unlearn this mentality and acknowledge that being I-centric in sales conversations doesn’t lead to successful outcomes.

You’ve spent substantial time and effort ‘birthing’ your product and naturally, you find it exceptional. However, it’s essential to realize that not everyone will share your enthusiasm – and that’s okay. The key lies in understanding that sales is not about you as the seller.

Shifting the Focus in Sales Conversations

Sales should be you-centric, we-centric, or buyer-centric. In other words, your focus should be on the buyer. Think of your role in sales as showing up in service, not with a ‘get’ mentality. Yes, your ultimate goal is to make sales, but not necessarily with each individual you interact with.

Sales isn’t something that you do *to* someone. Sales is something that you do *for* someone. It’s a place of service.

Think of sales as synonymous with love – showing up with the intention to help the other person. A sales conversation, at its core, should be about aiding the person you’re conversing with. If you genuinely help people, they’re likely to buy your product or service. – Christopher Philipiak

Many sales conversations face two main issues:

Founder Infatuation: The founder is in love with their product and wants to talk about it incessantly.
Early Sales Focus: Early salespeople are often desperate to make a sale, focusing solely on the money they can earn.

These issues lead to ineffective sales conversations. By shifting the focus away from the product and the urge to sell, and instead towards serving the buyer, sales conversations can become more productive and successful. This buyer-centric approach fosters a genuine connection and understanding, resulting in higher sales and satisfied customers.

Reframing the Sales Conversation: Setting Intentions, Goals, and Key Moves

One of the first steps in shifting your perspective on sales is to reframe the sales conversation. Understanding and employing the right structure for your sales conversation is crucial.

Christopher’s framework is to set up your positive intention, goal, and key move.

Positive Intention

Before you start any conversation, be it a sales call, a podcast, or a speech, get clear on your positive intention. This intention should ideally align with the spirit of service and aid. In the context of sales, your positive intention needs to be to help the other person.

Goal

Next, identify your goal for the conversation. What outcome do you hope to achieve? In my case, the overarching goal of most of my sales conversations is to make sales. However, this goal should be specific to the conversation at hand and should revolve around you and your business needs.

Key Move

Finally, decide on your key move. This refers to one specific action or step you’re committed to executing during the conversation. For example, my key move in a sales conversation might be to tell a compelling story or schedule the next conversation.

Taking a few minutes before a call to get clear on these three elements can significantly impact the success of your conversation. Even if you don’t have a perfect script or the exact questions to ask, by showing up with a clear intention, a specific goal, and a key move in mind, you’re setting the stage for a fruitful conversation.

The beauty of this approach lies in its flexibility and adaptability. Whether you’re making a sales call, delivering a speech, or even participating in a podcast, this framework can enhance the effectiveness of your communication and help align your thoughts and actions towards achieving your desired outcomes. Ultimately, it allows you to bring your best self to every interaction, and when coupled with a spirit of service, it can lead to successful and satisfying sales conversations.

Facilitating Clarity and Urgency

Sales conversations can be seen as an art. Their core essence lies in facilitating clarity for the buyer. This clarity revolves around what the buyer desires or the outcome they are aiming for. But how do you achieve this clarity, and why is it so crucial in sales?

Creating Clarity

As the seller, your role in a sales conversation is to be a guiding light. By asking strategic questions, you help potential buyer gain clarity about their goals and the obstacles that prevent them from achieving them. Can your company provide a solution to their problem or help them attain their aspiration? This is the question you need to answer. If the challenges they’re experiencing align with your company’s capabilities, there is a match.

Building Urgency

Once there’s a fit, the next step is to gauge the buyer’s commitment level. Do they urgently want to solve their problem or achieve their aspiration? It’s essential to tap into their sense of urgency because without it, the sale will likely not transpire. If a potential buyer lacks urgency, they are probably not ready to embrace change or go through the growth process. Hence, if you sense a lack of urgency, it’s better to end the call and move on.

After gaining clarity on the buyer’s needs and urgency level, the final piece of the puzzle is to determine whether the potential buyer is a ‘yes’ or a ‘no’ to purchasing from you. At this stage, your sales conversation should be simple and direct. You’ve helped them realize their needs and the potential solutions you offer. Now, it’s their turn to decide.

Delivering Value Through Conversation

A critical aspect to keep in mind is that your positive intention should not be to sell them something that helps them. Instead, your intention should be to help them through the conversation. The true gift of a sales conversation lies in the discussion itself.

When you demonstrate expertise and help the potential buyer understand their needs better, you build trust and rapport. You deliver value not by handing out informational material but by skillfully facilitating a conversation that allows them to reflect on their desires and the problems they face.

The ability to hold such a sales conversation is a skill that requires development. If you can master this art, you can have enriching, helpful conversations that naturally guide potential buyers toward making a purchasing decision.

Crafting the Perfect Sales Conversation

Working with a client to establish a constructive sales conversation boils down to two main elements: Understanding what they want and identifying their issues. However, how you approach these conversations can greatly influence their outcome.

Asking the Right Questions

In larger B2B deals, you might find yourself asking more logistical questions like, “Who else is involved in this decision?” or “What are the success criteria for this project?”. These questions can help you get a clearer picture of the decision-making process and the parameters of the project.

However, in most sales conversations, such questions are not as critical. In fact, they can sometimes clutter the dialogue. What’s more important is asking the person what they want, what outcome they’re hoping to achieve, and what issues they’re facing. With these two simple questions, you can have an insightful conversation. It’s crucial to stay engaged with these questions, unpacking them and allowing them to breathe, leading to a more profound understanding of the client’s needs.

Unpacking the Urgency and Commitment

From there, you aim to understand if the problem at hand is important to the client and if they are urgent to solve it. Another critical question is, “Are they committed to solving this problem? Do they really want what they say they want?” If their desires, urgency, and commitment align and you can provide what they want, that’s when you can talk about solutions or products.

Avoid Leading with a Product

Leading a conversation with a product demo or pitch can diminish the value of the conversation. You risk pushing the buyer into a corner, where they’re left to evaluate whether your product can solve their problem. Instead, aim to guide them through the process, helping them understand what’s going on. Rather than throwing ‘stuff’ at them and expecting them to decipher its value, step into the role of a guide.

Showing Up as an Expert

You might have worked with many sales organizations, implemented numerous CRMs, and developed processes for large companies, but that doesn’t mean your buyers are inexperienced. They have a deep understanding of their business. However, when it comes to the problem space, potential solutions, market trends, and what works or doesn’t, you should step into the expert role.

Therefore, you must show up with your expertise, armed with the right questions. In doing so, you serve your client better by helping them clarify their goals, understand their problems, and evaluate potential solutions. This approach creates a more meaningful and productive sales conversation.

Conclusion

Successful sales conversations are rooted in understanding your client’s needs and offering solutions that genuinely align with those needs. It’s vital to prioritize dialogue around what the client wants and their associated challenges rather than leading with a product or service pitch.

Additionally, showcasing your expertise through insightful questions, showing understanding, and providing guidance, rather than just presenting a product, creates more valuable and effective sales conversations. Ultimately, the art of sales conversation lies in helping your client navigate their problems and goals, fostering a stronger connection, and leading to more successful outcomes.

If you want to learn more about Christopher’s founder-led sales framework, you can reach out on his email at christopher@christopherfilipiak.com.

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