I have a sales problem. Or do I?

Here @smedvigcapital we spend a lot of time thinking about how we can help our portfolio companies grow quicker and better. And I mean a lot of time. It dominates the discussion internally; shapes the way we interact with our teams and affects how we think about organising our own team.

Over the last decade many interesting topics have been debated, but without doubt the one that has come up most frequently has been sales. “What a great business we just need to get the right sales team” or “If only we could get 3 people who can sell as well as the founder” have echoed around the building many a time…

Now sales is a difficult discipline. It is difficult and costly for early stage businesses to recruit great sales talent and even more difficult to manage that talent effectively. Mistakes will be made. The costs of those mistakes (in both cash and opportunity) will be high at a time when the business can least afford it, and everything should be done to optimise — There is much to say here, but that isn’t what I wanted to write about…

As I reflected over the Bank Holiday weekend (and with the new twins vying for attention alongside a toddler this reflection was less the classic deep / removed and more snatched / frenetic — but maybe that was helpful!) I realised that for the small cluster of businesses we had spent many many hours talking about the complexity of building a salesforce and bemoaning the lack of scalability of founder sales there was a common trait which wasn’t sales.

It was in fact with the lack of clearly articulated product. Yes, founders could successfully sell it, but could the hired help? Not a chance. Did we have a really compelling elevator pitch for any of them? NO. Did we have a well scoped product strategy that was an integral part of the business planning cycle? NO. Did we waste many years hiring and firing sales people rather than fixing the root cause — absolutely.

Interestingly the product sets at these companies never felt like a major weakness and in fact often we invested behind them solving a critical problem; but they were always complex. The sales people never coherently pointed to the product being the problem > They were trying to copy the founder doing complex solutions sales. Sales had become complex culturally. In all those cases marketing was weak — as it almost always is without a clear and coherent product to work with.

So, my challenge to all my current and prospective portfolio companies is now this: Does you product sell itself? Genuinely? If the answer starts with “well its complicated” then take a long hard look at product before investing in sales, it might save you a lot of time money and heartache.