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How to Build & Scale an Inside Sales Team
Inside sales at a startup, Lenses.io acquisition, grocery delivery wars and buyouts, 1130 jobs, Facebook outage aftermath, events, and more
👋 Happy Friday! Welcome to Hunting Greek Unicorns #39. I’m Alex, a product guy turned VC, and every two weeks I send out a newsletter with everything you need to know about the Greek startup industry.
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How to build and scale an inside sales team at a startup with Georgios Gatos, Chief Revenue Officer at Toggl
When is the right time to build an inside sales team at a startup? How do you build a repeatable and scalable sales process? How do sales fit in a product led company?
These are questions many teams face during their journey, so I’m really excited to have Georgios Gatos on Hunting Greek Unicorns to deep dive into creating and scaling an inside sales process (i.e. the way most software companies do sales nowadays; selling remotely via phone, email, and other digital channels, instead of face-to-face) and grow revenues. Georgios is one of the most knowledgeable people I know when it comes to sales, growth and revenue in startups. He’s currently the Chief Revenue Officer at Toggl and previously the VP Growth at Workable. He has been in the Greek startup industry for quite some time; part of the first startup communities in Thessaloniki, co-founder of Incrediblue, an online marketplace for boat rentals launched in 2012 and acquired in 2018, and mentor of several teams.
Let’s get to it!
At what point in their journey do you think startups should consider building an inside sales team? What are the traits that hiring managers need to look for in early hires?
If you are running a SaaS startup targeting small and medium-sized enterprises (50-500 employees), I would suggest that before building an inside sales team, you first need to tick the following boxes:
You have reached product/market fit
Marketing is generating enough qualified leads per week to keep 2-4 sales representatives busy
Current revenue ACV (annual contract value) is minimum around $3,000 and might need well above $5,000, depending on LTV and where your team is based.
Sales teams need to operate under a scalable and repeatable model. If there is no product/market fit, then your team will have a hard time identifying targeted prospects. Even when they do, the close rate will be very low. At the same time, a pool of (ideally) inbound leads that are qualified for sales is key to help your new sales team validate the value proposition, train themselves with “warmer” leads, and ensure some early wins. Lack of leads will limit you to outbound only outreach and this requires significantly more time before it bears fruit. Finally, as sales department costs are significant, if the ACV of your product isn’t high enough, you will lose money with every sale.
When it comes to hiring and building a sales team, there are some traits that are preferable. For instance, look for an entrepreneurial mindset. Make an effort to attract resourceful people who can think on their feet. In a lot of cases, someone with industry-specific expertise can add a lot of value too. Avoid at all costs the wandering salespeople, those with an average of 11 months tenure over the past 2-3 companies. Furthermore, those who come from big companies often struggle to adjust and perform.
The final advice is to hire for what you will need in 6 months and make an effort to hire in pairs, as onboarding will be more meaningful and less time-consuming.
When trying to build a repeatable and scalable sales process what are the different roles required at the team? How do all these fit together?
Zooming out, the three key roles that are included in an inside sales team are: Account Executives (AEs), Sales Development Representatives (SDRs), and Customer Success (CS).
Account Executives (AEs) are the ones whose focus is to close the deals with the customers. Their performance has dependencies. From who to talk to (leads) and how to engage with them (training and messaging), to enablement tools and motivation (compensation plans). In a new team, you will have fewer people, who wear multiple hats. A common mistake I have seen is when one of the founders becomes a part-time sales manager. I recommend that you skip this part and hire a sales manager to orchestrate most of what was mentioned. Someone to hire, onboard, coach, and enable the team in the early days. Down the road, a person to handle SalesOps will be needed to take a lot of the day-to-day burden of the sales manager.
Moreover, it is very likely that you will need a few Sales Development Representatives (SDRs). Their role is to source qualified leads for your AEs. This can provide multiple benefits if done right. As an entry-level role, SDRs cost less, are super ambitious, and focus on qualifying inbound and outbound leads, which AEs typically spend the least time possible. Successful SDRs will become your future AEs (it takes about 15 months). In most companies, SDRs report to sales, but it’s not unusual to be part of the marketing team.
In addition, Customer Success’ (CS) job often begins right after the sale is closed and their focus is to ensure a proper onboarding process for the customer. A lot of times, people in CS have previously held roles in the support team, as they have the most interactions with customers and deep product knowledge. A good handover between sales and CS is key. For an AE, the job is done the moment the customer has signed, but for the customer, their journey has just begun. A proper onboarding, where applicable, will increase tool adoption and offer multiple revenue expansion possibilities. Therefore, the role of CS should not be neglected even in the early days.
There's been a significant change in how software companies follow their go-to-market strategy in recent years, which is driven by product led growth i.e. relying on using product as the main vehicle to acquire, activate, and retain customers. Where do you think sales fit in a product led world?
Sales teams need leads. Under sales-driven growth, it’s the marketing team that generates leads for sales. They use a scoring system to determine the leads that should be passed to sales, and this takes into consideration firmographic, geographic and pre-signup user engagement. Under product led growth (PLG), the actions that the end-users (your users) take within your product are more important than the aforementioned, which still get into the mix, but with less weighting. The rest of the sales process is pretty much the same and the team enjoys working with a “warmer” and more educated user base.
Some common processes followed are: AEs look for free users coming from the ideal customer profile companies and use them to build a case to sell a paid plan to a team within that company. They also use the knowledge gained by a team on a paid plan to sell to other departments within the same company or sister companies in their effort to expand the account. Or they focus on upgrading a growing team from a basic plan to a more “enterprise” one.
In addition to product qualified leads (PQLs) i.e. leads qualified based on their product usage, two more things are needed to increase your success: A clear upgrade path between the different plans (free and paid) and compelling arguments for the managers of your end-users, and their bosses.
Regarding the clear upgrade path, it’s the heads of product, marketing, and sales that should work together and revisit the offered plans and pricing. If the differentiation is based only on features, your sales team will struggle to convince customers for an upgrade. It’s recommended to add a usage-based/seat-based element, which is something most companies do already, and it increases success as we have seen from successful SaaS companies e.g. Intercom’s “People Reached” metric or Chargify’s “revenue threshold”.
Moreover, a playbook that helps sales reps to raise enough interest to the decision-makers is key. Most of your end users aren’t the ones deciding. PLG allows them to convert easily, using the tool for free or with a low cost that goes under the radar of the typical procurement processes. As your end-users tend to be happy with the plan they use and they don’t need the “enterprise” features such as admin, security and reporting, they will be reluctant to upgrade under PLG. Sales teams will proactively engage with their end users’ managers and the managers’ managers to build a case for a department-wide adoption, enterprise-level features and higher prices. Hence the need for a good sales playbook.
Lastly, PLG isn’t helping when it comes to outbound sales efforts, which is how companies that are not aware of your product or are not in the market for a tool such as yours will learn about you and could end up paying customers.
You raised VC money for a startup back in 2013. In what ways do you think the current fundraising landscape in Greece has evolved since then?
It’s been a long time indeed. Nowadays, Greek VC firms can show a track record, write larger initial checks and follow ons, and a lot of the fund partners have experience participating in board meetings together with Tier1 global VCs. Furthermore, there are a few specialized funds that invest in pre-seed and focus on technology transfer. We also see more private LPs (those investing in the funds). None of these existed back then.
Today, I feel that there is more money available than teams to raise funds. Probably that’s why VCs also spend a lot of time scouting for Greek founders living abroad or founders with Greek roots. Rounds and valuations (especially post-Series A) have increased a lot, following the global trend, and the startups that stand out have traction, with business models and unit economics that make sense. Back then, that wasn’t always the case. At the same time, we also see great examples of bootstrapped startups.
Regardless of funding rounds and sizes, the early signs from a lot of founders are impressive. And it makes sense as we see second-time founders or key executives from already successful companies starting new businesses. Even first-time founders successfully attract advisors who “have been there before”. In addition, corporations are more active in supporting, partnering, and even investing in a lot of startups. We didn’t have that as much either. Overall, I am really optimistic and hopefully more large exits will happen in the coming years to further fuel this success.
If you want to learn more about building and scaling inside sales teams, you can reach out to Georgios on LinkedIn, here.
🦄 Startup Jobs
Looking for your next opportunity? Check out job postings from Greek startups in Greece, abroad, and remotely. Company information is also available.
Lenses.io was acquired by Celonis! The leading enterprise platform for real-time DataOps joined forces with one of the most successful European enterprise software companies and decacorn with over $11b valuation. That’s one of the most prominent acquisitions of a B2B tech startup in Greece. Congrats to the whole Lenses team 🙌
The race to become the dominant on-demand shopping service is on! Delivery Hero acquired Kiosky’s, with efood now establishing its own network of convenience stores. At the same time, Wolt launched its second dark store. One of the upcoming players (launching soon? in Athens) is the well-funded JOKR, with Greek co-founder and presence in other markets too. Here’s an interesting deep dive.
INTERAMERICAN acquired insurancemarket.gr, a comparison platform for insurance policies, financial products and energy tariffs.
Skroutz continues to grow fast, hitting an annual turnover of €38.8m in 2020; a 96% increase compared to the year before.
Vertoro, a startup offering a bio-based alternative to fossil resources, announced its Series A round.
More funding announcements from the Greek diaspora: BetterUp raised $300m, bringing the mental health startup's valuation to nearly $5b, and ScienceIO raised $8m Seed to help healthcare providers make patient-first decisions with data.
Avrio, the collaborative User Research platform, launched on Product Hunt.
Loctio, a team democratizing precise location capabilities for IoT devices, is the first startup to enter the new ESA BIC Greece incubator, here.
🤓 Interesting Reads
What were the root causes of Facebook’s global outage from the Code BGP team, here.
An interview with Andreas Stavropoulos, Partner at Threshold Ventures, on the Greek startup ecosystem, VC industry, connecting universities with the business world, and more.
A guide by Odysseas Lamtzidis, previously Developer Relations at Netdata, on learning Solidity, a programming language for writing smart contracts.
Christos Hadjiaslanis, founder & co-CEO at Synth, on building a startup with Rust, here.
Breaking a monolith and solving the problem with data replication by Nikos Voulgaris, Software Engineer at Blueground, here.
A post by Vassilis Tziokas, Global Industry GTM Lead, Data & AI at Microsoft, on going down the crypto rabbit hole.
Some great insights from Steven Galanis, co-founder & CEO of Cameo, talking about his journey, the chicken and egg problem in marketplaces, lessons learned on leadership and building a team, and much more.
Marco Veremis, Partner at Big Pi Ventures, discussing the early days of Upstream, investing in startups, and the Greek startup industry, here.
Roza Tapini and Nour Bantrentin from the HR team at Skroutz on the company’s culture, candidate experience, and more, here.
A podcast with Dean Pappas, co-founder of Grape Network, introducing Grape, discussing DAOs, Web3 gated communities, and social tokens.
A podcast with Kostis Gkiokas, Engineering Manager at Plum, on building a fintech app to facilitate millions of transactions daily.
Thanos Geramanis, Partner & COO of Blueground, on the company’s growth trajectory, challenges during the pandemic, and future plans, here.
Guy Krief, co-founder of Persado and Bryq, and Lakis Gavalas launched a new podcast series where Greek founders pitch their startup ideas and then Guy and Lakis decide whether to angel invest or not. First two episodes were with City Crop and Phasmatic.
Interesting events coming up from the Greek tech community:
“21th (Online) Thessaloniki UX Meetup” by Thessaloniki UX Meetup on October 17
“Vulnerabilities in Open Source Projects” by Athens Laravel Meetup on October 19
“#23 Code That Fits In Your Head and AMA with Mark Seemann” by Domain-Driven Design Greece on October 19
“MoT Athens Lean Coffee: How to improve your solo testing” by Ministry of Testing Athens on October 20
“GCC Social Meet-up in Thessaloniki” by Greek Cryptocurrency Community on October 23
“#5 Flutter Greek Community Meetup” by Flutter Greek Community on October 26
“The Agile Chronicle” by Agile Thessaloniki on October 27
How did you like this week’s Hunting Greek Unicorns? Your feedback helps me make this great.
If you want to get all the latest updates from the Greek startup scene as they happen, and enjoy reading about startups, product, and growth, you can also follow me on Twitter!
Thanks for reading and see you in two weeks,
Greek Startup Pirate 👋