If you hire your first VP of sales based solely off their charisma, or ability to sell you a fake pen, you’re going to regret your decision.
Today, there are many specific details your VP of sales should understand in order to put together a team of sales reps, a strong sales strategy, and the proper set of sales tools to get your next million dollars of revenue.
There are 30 questions you should ask your potential VP of sales. These questions should cover hard numbers, the character of the person, and how your potential hire would manage of team.
When Should You Hire Your First VP Of Sales?
When you, the founders, sell at least $1m of product yourself.
This means you have some product market fit, and you have a good idea of what the sales motion looks like. Your VP of Sales should be able to come in and operationalize what you’ve done so far and then hire your first few quota carrying reps.
Before we get into the good stuff, remember that its very hard to scale an inside sales team or a field sales team if your price point is anywhere below $5,000 per year. This chart will help you understand why.
Ok, so you need a VP of sales and are not sure where to find one and what to ask.
These are the 30 questions you should ask any sales leader, sales candidate, or your first VP of sales.
1-10: The Math Every Good VP of Sales Will Know Behind Running a Sales Organization
1. What should quota per sales rep be?
Answer: At a SaaS company, when a rep hits quota, they should earn about 1/5th in total compensation. If quota is $500,000, that rep should make $100,000 in annual salary (base + commission).
2. Should the sales process be demo driven or partner channel driven?
3. As a sales department, what is the new annual recurring revenue (ARR) bookings target for next quarter?
Answer: If your VC backed with under $10m in revenue, you should be growing a minimum of 15% per quarter. Meaning, if you have $100k/mo in revenue today, 3 months from now you should have at least $115k/mo in revenue ($15k/mo in new revenue, or new annual recurring revenue of $15,000*12 = $180,000)
4. What commission should you pay per rep?
Answer: 15-30% of first year contract value is typical at a growing SaaS company.
5. How fast should new hires ramp up?
Answer: Generally reps should hit quota by the 6 month. If you set an annual quota of $500,000, that means the reps needs to get $42k in new annual contracts closed each month. By the 6 month if they haven’t had a single month where they hit that mark, consider letting them go or analyzing if your quota target is too aggressive.
6. How and when will you decide when to let a rep go due to low performance?
7. Are sales reps missing quota because the company isn’t giving them enough leads or because they’re a bad sales person?
8. Will the company do lead generation or should each sales rep be responsible for getting their own leads?
9. What red flags should you look for in a potential sales rep hire?
10. What does the full compensation plan look like for a sales person?
These questions are all heavy numbers and tactics driven. When you interview a new VP of Sales or any sales hire, you have to ask about character as well.
11-20: Interview Questions to Learn About A Sales Person’s Character
11. How did you feel the last time a customer yelled at you and hung up?
12. Why did you get into sales in the first place? What was the first thing you sold?
13. What was the last sales strategy you tested?
14. When did you lose your last deal and why?
15. Do you think you’d enjoy hanging out with our customers? Why?
16. What’s your best tactic for dealing with objections on a sales call?
17. What’s your least favorite part of selling?
18. Describe a time when you were an underdog and won.
19. How do you balance work and life?
20. Have you ever had a boss you didn’t like, why?
21-30: Interview Questions To Test Your VP of Sales On How They Would Lead and Manage Your Sales Team
21. How would you motivate a rep that usually hits quota but missed the last 2 months in a row?
22. Should their be a team incentive for hitting the company’s overall revenue goal in a quarter?
23. Would you put a public leaderboard in the office showing how much each rep has closed?
24. If a rep always hits quota but rarely comes to the office, would that be a problem?
25. If a rep closes 80% of their quota in the last 5 days of the month, is that ok?
26. If sales are down, whats the first thing you’d do?
27. Describe your favorite boss and why you liked them.
28. When you’re not feeling motivated, how do you motivate yourself?
29. What’s the most exciting sale you’ve ever closed?
30. When is the right time to fire a sales rep?
These are the 30 great questions you or your hiring manager should focus on during the job interview. It’s best to have your recruiter try and gather some answers if you can.
Many times a VP of Sales will have a sales management style that they probably learned from their past sales manager. The best candidates understand that each industry and market is unique and that they’ll have to adapt. Look out for candidates that only know one playbook and one “right answer”. True sales professionals know how to lead their team members through many changes and tests.
Top performers and Sales Teams are always testing these 4 things:
1. Is sales quota too high or low?
2. Are quota carrying reps getting enough leads? What is the ratio of Sales Development Rep to Account Executive to Customer Success Manager?
3. Should all 3 sales roles participate in commissions and quota?
4. Is there a team quota we should use to incentivize everyone to work together to get to the next level?
These tests are critical to any sales job but are hard to test for in the interview process.
If you’re curious about how many sales reps you should have as a percentage of your entire team, check out this data. You’ll also see how many reps certain SaaS companies currently have relative to their prices points.
Good luck with your next hire!