Building Out Your Sales Team – Hiring, Commission, Training & More

Bruce: Hello, everybody. This is Bruce from Printavo, simple shop management software. We’ve got a very special guest with us today, Kevin Baumgart from ‎Hireology. He is the VP of biz dev over there. Kevin, welcome to the show.

Kevin: Yeah. Thanks for having me, Bruce. I appreciate it.

Bruce: Yeah. Absolutely. So Kevin, I brought on as a lot of shops are starting to bring on salespeople or wanna try to focus or understand how sales can affect their business and Kevin’s got a ton of experience in that area. So I just wanted to really, you know, focus bringing on that so that everyone can learn from that, and he’s not in the printing space actually. So he’s working on a startup and you could tell us a little bit about that first.

Kevin: Yeah, happy to. So I work and run business development for a company called Hireology. We’re a web-based software service based recruiting and hiring platform that’s helping small businesses to better manage the what way that they structure, source, acquire, and then select the right talent. So I’ve had a really interesting experience of starting at this organization early. There was three of us in a small hallway. We’re now up to 120 employees, went through some rounds of venture capital financing. So I’ve been able to get a really, really close glimpse of our business growing from just a few of us to what we’re at today.

Bruce: Very cool. And what did you start off there as? Was it on the sales side, too?

Kevin: Yeah. So I was hired to really build out and structure the entire sales organization, everything from defining our messaging and our pitch to hiring salespeople, to creating compensation plans, to figuring out our target market. Really everything that on the sales end I was tasked with doing which early on that included me cold-calling, right? And supporting our customers, closing deals, running demos. So really, all of the specific sales stuff which it’s obviously changed a lot as time has gone on and as our business has matured.

Bruce: Sure, got it. Very cool. And how long ago was that when you started?

Kevin: So my five-year anniversary was this month.

Bruce: Okay. Very cool. So yeah, you know, 3 to 150 is definitely a huge leap. Talk about a little bit on the messaging. So when you first started, your goal is to really build out that whole process. I mean, you have a complete blank slate, a lot of these shops are very similar, and they wanna ramp up the sales side. And so you’ve mentioned the messaging and the pitch side which it seems pretty foundational.

Kevin: Yeah. I think that is as foundational as developing and building your sales process. So, I think for us and one thing that we did right was document the successes and the failures that we had. So defining the steps in the sales process that worked to then acquire customers and those steps that didn’t work. And in part of that was messaging and the pitch. So through voicemail scripts, email scripts, demo scripts as we’re running meetings with potential clients, what are the things that we say that resonate and that work well, and then how do we integrate that into the whole sales process to make sure that we’re doing the right things to bring those customers on.

So it’s a pretty critical part upfront. We also had had some help on that. So we hired a consulting company that did some appointment and lead generation for us, and part of their services was to get a really good understanding of our business and how we help our clients. So, they actually did do some of their own messaging creation, so that the folks on their team that were calling on our behalf schedule meetings had a good understanding and talk track that they could follow as well. So it was a combination of us creating ourselves and then as an appointment setting service that we needed helping to create that as well.

Bruce: So is that more of allegiance, sending you potential leads or it’s actually helping you develop the scripts, you know, the messaging and what you wanted to say to customers?

Kevin: Yes. So they called themselves a door opening service. So they were actually setting the meetings for us. So at that time, I probably had a sales organization of eight or nine people, and we realized that speed to market was really important for us. So we found a specific niche on the market that we wanted to target, and we felt that adding a appointment setting service to the structure that we had created will help us get there faster. And part of their service on the front end was to help us create that more structured messaging and pitch them what we had already had defined.

Bruce: Yeah. So that’s interesting, picking the niche and really going as fast as possible into the niche and using them to help expand that pretty quickly. So those first few people…So you skipped to eight people. What about the first hire? Walk me through where did you look to find that person, you know, obviously them setting it up. What type of person would even be interested in something where it’s like, it’s just them or you and him?

Kevin: Yeah, yeah. So, I realized pretty quickly as I started in all of the roles of the sales process, cold-callings, scheduling meetings, running meetings, supporting our customers that were on the platform. I was [inaudible 00:05:44] pretty quickly. So, and I found myself really just working on the easy stuff, right? Running meetings and supporting customers, that’s way easier than pick up the phone cold-calling, right? So I realized that we needed to have some support on that front end.

So the first sales hire that we made outside of myself was someone doing just that, you know, making 80 to 100 phone calls a day and scheduling additional meetings for me to run. That person had a couple years of sales experience, and I think the reason why they joined our organization is, you know, we had a pretty interesting story to tell, high potential, you know, high growth start up even the short time that I was there. They had an opportunity to get into the ground floor and help us really grow and expand the business. That person is still there today, the first hire that I made. He runs our franchise business team, our franchise sales team.

So yeah, those early hires were really critical and I think we’ve realized really quickly where there was gaps, like, we didn’t have so much focus on supporting the customers that were on the platform, we needed to hire someone and really build up a structure and the process on that end. Same thing with me with that first hire figuring out that we needed someone that could really focus on cold-calling and that inside business development and scheduling meetings for us.

Bruce: Gotcha. Where did you really specifically find them? Was it a friend recommendation or…

Kevin: So, I mean, since we’re a recruiting and hiring platform I have a little bit of a luxury of better managing that because it’s our business, right?

Bruce: Yeah.

Kevin: But we utilized a number of sources. Job words are still a necessary evil. So sites like Indeed. Indeed is the largest job word aggregator in the U.S. They have over 110 million unique visitors a month. So Indeed helped our internal social media. So, having all of us post our internal social media channels that we’re hiring for specific role. We also structured an employee referral program so that if any of us get help to find a candidate, we would be compensated in some way for that. And then really building out our career brand.

So even though we’re a small business and didn’t have a lot of experience with helping employees to grow, we’re able to tell a story on our company website and showcase why we’re an employer of choice and why people should wanna work there. Again, the selling opportunity for us early on and still kind of that is get in early at a high growth startup, opportunity to grow and advance that that was really our message in the way that we hope to attract people into the business.

Bruce: Got it, and the…So, finding the person usually salespeople are commission-based, it’s kind of hard to figure out how commission works for different types of businesses. But what types…A lot of these shops are…they might bring in a sale of, you know, a couple thousand dollars, a couple hundred dollars up to $10,000, you know, $20,000 or more and it could be one time or over and over. What tips do you have for helping to create a sort of plan that’s beneficial for them to help them and motivate them, but also helps the business to grow, too?

Kevin: Sure. So I think what we…Commission and comp plans can get really difficult and it’s hard to structure. A couple things that I did, I just…I leveraged my network and talk to as many people as I could as to how they structure comp plans. So I talked to a lot of people even our vendors. So like, our CRM provide which was salesforce.com, I talk to their compensation expert to really understand how they pay their salespeople and how they compensated them overall. I think the biggest thing that I learned was that you wanna really compensate for the behaviors that you wanna see.

So if I want someone cold-calling and setting meetings, I wanna compensate them for getting those meetings set and held, right? If I wanted an account executive that’s actually gonna close the business and bring [inaudible 00:10:01] that compensate them and condition them on getting that revenue in the door, and then you just have to make sure that it’s structured and then it fits to your business. So, what portion of the sale can be providing commission that it still makes sense for our business, but that it’s still lucrative for that salesperson, and there’s a pretty easy model to work that out. But I think just underlying the most important thing is incentivize and motivate people according to the behaviors that you know that they need to do to be successful in their job.

Bruce: Got it. So really right out kind of the sales process that you’re looking for them to do and then maybe tackle those different pieces and create a structure.

Kevin: And the more that your businesses is metric, the easier that gets, right? So you’ve got your sales process set and defined, and you know the behaviors that are gonna drive and increase the business and drive revenue to the organization, the more that we can metric each of those steps in the process like the number of calls that are made equal to the number of appointments that are set, the number of new opportunity employments that are held, right now all the once that get set hold, so those that hold. Our closing ratio is x% typically, our average deal size is x. The more that we can metric all those pieces in the business, the better off we’re gonna be and be able to focus on here’s how we should compensate and commission those folks based on what they do.

Bruce: Got it. So really getting as analytical as possible around the whole flow, the sales flow that they’re going through.

Kevin: And early on that’s difficult because there’s not a lot of tools and technology…

Bruce: Right. I was about to say. Yeah.

Kevin: …in place. A business like ours now, we have such a structured organization behind our CRM which is salesforce.com. It’s really like in our ERP. It runs our business from the back end perspective. We have a ton of reporting and data analytics out of that now. Early on, we didn’t have any of that. So early on we relied on really, you know, Google Sheets. Right?

Bruce: Yeah, yeah.

Kevin: We just shared Google Docs where we would…

Bruce: Which is great way to start it.

Kevin: Yeah. We would organize everything in one place. It was incredibly monotonous and time-consuming, but it was still a necessity to be able to metric the behaviors and the impact that our team members are having and making sure that we’re aligning compensation and everything else to that.

Bruce: Did you iterate on it relatively often or did you kind of said it, “Wait a couple months and see how that worked?”

Kevin: Like comp plans and commission structures and all that?

Bruce: Yeah.

Kevin: All, we iterated it nonstop. So, our business shifted and changed so much that we had to. And I think my CEO instilled this in me that, you know, there’s a lot of unknowns here. And in a business like ours, we have to all be able to thrive in ambiguity and be able to work on our feet and it’s always gonna change. So he made me a promise when I started that, “The only thing that I’ll promise to you from a comp plan perspective is that we’re gonna screw this up, but we’ll make it right.”

Bruce: Sure.

Kevin: So, about once a quarter we would reiterate and look at comp plans and just make sure that it made the most sense for our employees and for the business overall.

Bruce: Okay.

Kevin: And our employees knew that that comp plan was gonna be looked at on a quarterly basis and it still is today, quotas, compensation [inaudible 00:13:26] and they’re always changing and updating just based on the business.

Bruce: Got it.

Kevin: And if you’re open and you’ve got that transparency upfront, it makes it that much easier. And anything commission comp perspective, the more you can communicate it the better. So if there is gonna be comp changes, let them know that it’s coming up, have the conversation around why they’re changing, reiterate again, “A week after here’s why it changed. Do you have any questions?” The more that we can communicate that, the better. There’s nothing that would upset an employee more than getting comp plans change without really giving them insight as to why.

Bruce: Yeah. So keeping that as transparent as you can.

Kevin: For sure.

Bruce: I skipped over one big one which is how to hire them and going through the interview process. I’m sure everyone has worked to hire their first couple people and beyond, you know, there’s a lot of different candidates that may be out there, but it might be hard to find the right one or the good fit or someone that you can really depend on. What are some tips or things that you’ve gone through or maybe some more so your methodology of knowing when this is the right person, keep pushing him through in that whole flow?

Kevin: Okay. Yes. So I think with most parts of our business, the more process driven and structured it is, the easier it is. So I found that most small businesses don’t have a prescriptive approach that they follow when they’re recruiting and hiring the right talent. So I think for us the reason why our turnover is so low and why we’ve been able to grow the business as fast as we have and how we’re able to make good hires is that we’ve always followed a really structured approach. So that starts with sourcing, right? Getting the word out there about the job as many places as possible. We do a really simple prescreen on the front end. So we ask each of the candidates just a number of true and false questions about their past work experience. They’re obvious, automated through our technology, through Hireology.

So, we make that really easy to not have to look at every single candidate’s resume and application because were prescreening them on the front end and only looking at those candidates that score highest. From there then, we run a really, really structured and systematized interview process that starts with a phone interview, and then goes through in-person interviews. All of the scripts for the interview guides, the questions that we’re asking as well as the answers that we should be looking for are documented. So, as the hiring manager, I don’t have to guess what I should be asking and what I should wanna hear, all of that’s structured out, and there’s a scoring component behind that.

Bruce: Really. Okay.

Kevin: So, and it’s really not that difficult to do. Just think about the behaviors that you want that person to have. So for salespeople you want them to be persistent, you want them to be able to build trust, you want them to be competitive, and then think about questions that align to those behaviors. “So, tell me about a time when you needed to be persistent. Why did you need to be persistent? What was the outcome? What happened?” So now, I’m really instead of just having a high level conversation asking them about what they did, I’m now really learning about do they exude the behaviors that are critical for success in the role that I’m hiring for. So, in the beginning maybe profiling each of the jobs that we’re looking for and really understanding and listing out the behaviors that are needed for success in the job is pretty critical, too.

But then from the interview process, we then do some personality-based profiling and skill-based assessments, and then the obvious, verification services, background checks, drug screens, those things. So, we know when we have a good fit because they’ve outperformed all of the other candidates and all these steps. I wouldn’t say there’s one silver bullet that we can look at to say, “All right, I’ve hired the right person because they scored x on this assessment or because they did well in this interview.” For us it’s, “Let’s look at the whole process holistically and make the best decision based on the person that achieves the most in the whole entire process not just one step.”

Bruce: So early on, though, I mean, did you have that, you know, that some of those tools? Because, you know, especially a tool that to maybe…I guess I don’t know of different tools that a small or medium sized business can use to help analyze their personality and things. Are there simple questions or things that you guys use early on to help gauge that?

Kevin: Again, we haven’t had the luxury being a recruiting and hiring platform that’s built in the Hireology.

Bruce: Gotcha. So, you have this tool you built?

Kevin: We had it, we had it. That said small businesses, there is a lot of technologies out there that can help them profile jobs and help them create interview questions around that. A lot of even personality or behavioral-based assessments, based on a job description can that help you create behavioral-based interview questions on it as well. So there is a number of resources out there that can help even small businesses to organize that part of the hiring process.

Bruce: Okay. Cool. And so, you know, going through, so you essentially score them and create like a varied distance. So it’s not like, “Oh, I really like this person.” Someone else like, “Oh, I don’t really like that.” It’s very, you know, numerical.

Kevin: Yeah. It’s objective, right?

Bruce: Right.

Kevin: And you brought up a good point, Bruce. Before I started that Hireology when I haven’t hired salespeople, I’d hire people that I liked or people that were like me, or people that I would have a beer with, you know.

Bruce: Sure.

Kevin: That was my hiring criteria.

Bruce: Yeah.

Kevin: That has 100% shifted now away from that subjective decision to now a very objective data-driven decision on hiring the people that have the behaviors needed for success in that job.

Bruce: And have you seen…I’m assuming you’ve seen better success with less turnover and better quality candidates doing that versus trying to mimic you?

Kevin: Way more, way more. So, I get it right about half the time. You know, I’d hire a guy or gal and think that they’d be great, and then three months later they left or we had to let them go. And I will be like, “Why didn’t they fit?” And I think being that Hireology is optimized, we really need a prescriptive way to recruit and hire talent aligned to the behaviors that are needed for the job. So yeah, our hit rate, our turnover rate is way better now for salespeople than it’s ever been earlier on in my career.

Bruce: Got it. Very interesting. So, what about mistakes? Whether using your process, what are some gotchas that you found out that didn’t worked out very well that you’ve kind of [inaudible 00:20:32]?

Kevin: Regards to recruiting and hiring?

Bruce: Yeah. And more currently now too with the more subjective process. Were there some things…because I remember reading an article too about Google and how they would ask these crazy questions. And I remember too years ago when I was chatting with them as well, it was a lot more questions driven around like the ping pong balls in the airplane, like, how many could fill it up to see, you know, where you’re at and how you think through the problem. But they didn’t find any sort of actual data that showed that that was bringing on a better candidate, going through those types of questions.

Kevin: Yeah. No correlation to on the job success and performance.

Bruce: Right.

Kevin: Yeah. So, I think some of the mistakes that we made even with this more structured or rigorous approach, one was if we were in a hurry maybe skipping steps and not following the process holistically, it happened and typically the result wasn’t what we wanted. So, I think it helped us to understand and open our eyes to even if we were in a hurry and wanted someone in quickly, we still needed to follow the process. And what I just described is typically takes us about two to three weeks. That said, if we need to compress it into a week, we can. We just gotta make sure schedule is aligned and we’re a little bit more on top of getting the process completed.

So, I also think that especially when you’re hiring salespeople, you have to act fast. In a startup where I’m at, we can’t do anything slow, we were always moving quickly. And I think, you know, for the print shop folks that are listening, good salespeople are on the job market long. So if you find someone that could be a right fit, you gotta be willing to make a decision pretty quickly, but my recommendation would be to not sacrifice steps in the process and make sure that we’re following the right approach. We’re just doing it efficiently.

Bruce: Got it. I’m actually just writing some of those down because I wanna put it on…I mean, that’s a really good point. I actually listen to another speaker talking, he was saying, you know, especially very good salespeople, they’re not just gonna come walking through the door either.

Kevin: Right.

Bruce: He’s like, you know, “The top people you really have to seek after or find or, you know, they’re not gonna be a snatched up pretty quickly.”

Kevin: Yeah. So, salespeople are really hard to hire overall. Two things to keep in mind, one, even mediocre salespeople are really, really good at selling themselves. Right?

Bruce: Right.

Kevin: So, I’m not a stellar salesperson, but I don’t mean more than anyone. I can sell me pretty easily. So, that’s why it’s even more important to have a really structured interview process that ask behavioral-based questions about what they’ve done in the past. And the other thing to keep in mind, too, salespeople are a product of their environment. And what I mean by that is if I was a successful salesperson at let’s say Microsoft, Google, LinkedIn, Salesforce, name a large organization that has a lot of support and structure, I’ve got a lot of marketing collateral, I’ve got a lot of backing support, sales engineers. I’ve got a lot of support in most big organizations. If I was a successful salesperson at one of those organizations, that doesn’t mean that I’m gonna be successful at a small print shop with not a lot of direction and marketing background, and all those things that would make me successful. So, we gotta think about where, what the environment was and the support that they had in those roles.

Bruce: Is there certain characteristics that you can see that help people know that they’re gonna be more successful and one like a smaller less organized type of business versus a large one?

Kevin: I don’t know if there’s anything specific. I think that individual should be able to tell you that and their resume, and their past experience should prove that as well.

Bruce: Okay.

Kevin: So I would just…I would ask them and be really transparent, “We don’t have a ton of marketing support, we don’t have a huge name in the market, not a lot of people are gonna know you when you’re reaching out. Have you worked in other organizations where that was the case, and did you perform and excel well in those areas?” So just really trying to get a feel for what they’ve done in the past and what they’re looking for too, that’s something that they wanna take on.

Bruce: Yeah. We actually, we do the same. We literally just ask and say, you know, “We’re a growing business, very unstructured, but we depend on you to own your area. Is that something you’re comfortable?” And some people do that that’s a big thing and will just be like, you know, “I’m looking for something with more structure.”

Kevin: Sure.

Bruce: And it’s like, “Well, great.” You know, and I’m glad I asked that now versus figuring that out later. All that, you know, that skipping, but…Yeah. So let’s talk about now in training. So you pick the person, you brought them on. How do you get them acquainted? And what it applies to is especially in these print shops, there’s a lot of things going on. If you bring in some from outside the industry, there’s maybe 15-20 steps like that goes through just to, you know, create a promotional product or a shirt or a sign or anything like that. What do you put them through? What are the expectations that you have with bringing someone on time wise and setting goals, and things like that?

Kevin: So, every business is obviously different and the ramp time is gonna be different based on the technicality of the sales process and ramping up, and learning about the business. My recommendation here is create what we call 30, 60, and 90-day plans. So this starts in the interview process with the candidate. So, we together collaboratively, the onus is on the candidate, but we help them with it, is to create a plan to show what success looks like 30, 60, and 90 days in. And they typically will then present that plan on the completion of the interview process.

And then it’s tweaked again collaborative between us and the candidate before they’re hired. And then so, as they’re brought on and were ready through orientation and onboarding, we’re reiterating that plan. They’re making tweaks and changes to it and if we see fit. And then we’re checking in at least once a week on where they’re at the plan. After 30 days, to be check off all the…within 30 days to see how we wanna achieved, the goals, objectives. Same thing with 60, same thing with 90. We found that following a structured approach like that can really help them and help us to make sure that we’re all on the same page and expectations are met.

Bruce: Sure.

Kevin: One funny thing that we’ll also find is that as candidates are starting to create that plan, at times, they’ll self-select themselves out of the process. You know, they’re thinking, “Well, this is a lot of work. I don’t know if I’m cut all for this. I’m gonna bow out. I’m done.” You know, and we wanna know that now versus once we start through the onboarding and training process, and then they realize like, this is too much and we’ve gotta go through the whole process again. We wanna learn that as early as possible. And by building and creating those plans in the interview process, we found that it’s the right timing and we’ll help them hit those goals earlier on.

Bruce: Got it. Yeah, very cool. So those are some good…This is a lot of very good lessons. I really appreciate helping me out and, you know, providing all this knowledge from your side. And even though they’re not, you know, a printing business and a startup, a software startup or different things, but there’s a lot of commonalities especially in the hiring side. Give me one last tip that anything that you’ve learned, some sales related that someone could take and then say, “Okay. This is perfect,” so they don’t make the same mistake.

Kevin: One thing I always bring up that came to mind as you asked that question was we early on in our business had less structure and organization as to who our target client was. So we didn’t have a lot of…We were targeting small and mid-sized businesses, that was our core target market which that’s not a target market. That’s like 95% of all businesses in the U.S.

Bruce: Right, right.

Kevin: And I think we really quickly realized that we needed to find the niche in the market, and we needed to find a specific type of company and a subset of that market where we could really focus our energy and efforts to. And what we found is that…So then we spread ourselves in and looked at a lot of different markets, and took a lot of research and data back in and said, “All right. Here’s the market that we think is the best fit for our business.” What we were able to do then once we had a really specific target market to focus on, is put all of our efforts to that market and all of our expertise, all of our case studies, testimonials, white papers were for that market. We’re now looked at as a subject matter experts for recruiting and hiring for that market. All of our marketing dollars go into those trade shows and conventions, those associations. It’s really, really changed our business. And the mistake that we made is just not figuring out that market earlier, and putting all that focus and emphasis on that market when we should have. It took us a little bit longer to figure that out.

Bruce: Got it. So, really give very specific as the type of people you’re trying to target and go after it.

Kevin: The type of businesses, the type of contacts. The more specialized you can get, the better your message is gonna be. The better the customer testimonials are, the easier it’s gonna be to get front of them and learn their business because you know their business. You’re already working with a ton of their competitors, etc.

Bruce: Perfect. Awesome. Well, I really appreciate it, Kevin. Is there any book or person you’re following right now or reading through?

Kevin: Early on at Hireology, I read a book called “Predictable Revenue.” It’s so, I read it five years ago, it’s a little dated now, but it still has a lot of really great knowledge and information on how to structure an inside sales team. So, if there’s folks out there are looking up to hire their salespeople and figure out how to attract and acquire more business, and really how to warm up that cold call that we all hate, have apprehension towards, a book called “Predictable Revenue.” The author is Aaron Ross. It was a great book and I’m really glad that I read early on that we put a lot of our sales team structure and a lot of our initial cold-calling and outreach structure around.

Bruce: Got it. Awesome. Well, Kevin, thank you again. I appreciate the time. I know you’re a busy guy, and well, let’s see, it’s almost Thursday. So yeah, I hope you have a great rest of the week.

Kevin: Yeah. Thanks, Bruce. I appreciate it. See you.

Bruce: All right. Bye.

Kevin: Bye-bye.