Founder's blog

I Just Fired a Sales Guy [Mistakes I made #2]

Dec 22 2010 :: by Alex
This is the second post in the "Mistakes I made" series, where I share the "donts" of my startup experience.
I'm a software developer. I knew nothing about sales when I started. I knew a lot about frameworks, object-oriented-stuff, databases, even about web-design. But nothing about sales. So I hired a guy - a very distant acquaintance from the university - to do some part-time consulting for me. Hoping to offer him a fulltime job one day and, who knows, may be even a share.

He studied finance, marketing and all that "business stuff" developers have no clue about. And he seemed like a nice guy. So I thought - I needed someone like him...

Well, to put a long story short - this was a mistake. You don't need that kind of guy.

Why?


Basically, his work haven't brought any sales for years. Sales & marketing basics lectured at most colleges these days just don't fit Internet companies & startups. Especially the small ones. I should have done this long time ago. But you know, firing someone is tough, especially if he's a friend of yours, even a distant one...

Finally, the last straw that broke my back was when he proposed to charge our web-apps customers on a "per user" basis like most of our competitors do.

As you might know, one of the key benefits of our helpdesk software and small-business CRM software is that it's not priced "per user". This is what makes us different from the competition. This is what its like today and this is how it stays forever. And it's not just the sales point, it just seems fair. Let's admit it, development costs are the same - no matter how many users work within the app. This might make some sense when providing a SaaS-solution, but even if our servers run out of space - we may start charging for storage space, not for the number of users. That's what makes us different and that's what I stand for.

The guy proposed to eliminate that - you know, "price differentiation", "maximizing marginal revenue"... Yeah, I get the point. But "same price for any number of users" is our key feature, its what we stand for and what makes us stand out from the crowd.

By the way, what are we supposed to tell our existing customers? "Sorry guys, change of plans"? So I made the decision.

It's different now


Basically, you don't need a guy to call your customers and invite them to dinner or a golf club. You don't need sales meetings and presentations with canap├ęs - leave that to "Mad Men" and the 60's. You don't need fancy printouts and brochures. You don't need fair booths. Even the "big guys" are starting to realize that, just look at JetBlue & South-Western airlines. The sales function is getting different.

'I Just Fired a Sales Guy [Mistakes I made #2]' was written by Alex by Alex. CEO, founder


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