What are the biggest sales challenges for B2B SaaS startup Companies?
1. Poor sales process
A poor sales process for B2B SaaS startups is one that fails to properly qualify prospects, triangulate the buying process or leverage backchannels for successful enterprise sales.
This can lead to long and costly sales cycles, as well as a waste of valuable resources on customers who are unlikely to sign a contract.
Common challenges associated with a poor sales process include adding territories too early, hiring a bunch of AEs when there is no pipeline, and hiring AE and SDR hybrids.
Additionally, founders are often reluctant to push hard enough for a “no”, leading to deals that don’t close. To overcome these challenges, it is important to employ best practices with sales and marketing processes, carefully utilize CRM and marketing automation tools, build a company culture for documenting customer communications, and master the softer, P2P skills that lead to successful triangulation and backchanneling.
2. Lack of sales skills
The sales challenges for B2B SaaS startups can be broadly divided into five categories:
- Lack of clarity in the hiring process
- Slow hiring process
- Searching for top talent in the wrong places
- Hiring B-players instead of A-players
- Spending thousands on ineffective training.
1. Lack of clarity in the hiring process refers to the challenge of ensuring alignment of people and tasks to accomplish a goal. This can be mitigated by defining an ideal candidate and setting up a clear job description.
2. Slow hiring process can kill the organization and the SHRM reports an average of 42 days to fill an open position. This can be addressed by proactively identifying passive candidates and using AI and ML-based recruiting tools.
3. Searching for top talent in the wrong places could be an issue as the cream sales talent is rarely looking for a job. Companies should headhunt senior sales recruiters specializing in the IT or Software industry.
4. Hiring B-players instead of A-players is a mistake as cheaper is not always better. Companies should invest in hiring the best to ensure they outperform the competition.
5. Spending thousands on ineffective training is another challenge as generic sales training cannot cater to the specialized requirements of the software industry. The best solution would be to invest in specialized software sales training to maximize the ROI.
3. Poor sales automation
Poor sales automation can have serious consequences for B2B SaaS startups.
Without the right tools and processes in place, they will miss out on beneficial insights to help them find their product-market fit faster, leading to slower growth.
Furthermore, they won’t be able to leverage technology at every stage of the customer journey, such as capturing prospect information or nurturing and retaining customers. Without the right automation, sales teams will also struggle to track the right metrics, resulting in wrong decisions and low conversions.
Lastly, poor sales automation can also result in a content-thin website, leading to fewer leads, as well as inadequate customer support, resulting in lower satisfaction and more churn.
4. Lack of clarity
The lack of clarity challenge for B2B SaaS startups is one of the most important factors when it comes to the success of their business.
Without the proper clarity, it is impossible to ensure that the right people are hired for the right roles and that the hiring process is conducted efficiently.
Without clarity, there is a higher chance of hiring the wrong person, or of spending too much time trying to find the right person, resulting in a slow hiring process.
Furthermore, without clarity, startups may end up searching in the wrong places for top talent, or worse, end up hiring B-players instead of A-players, leading to a waste of resources and ineffective training.
To overcome the lack of clarity in the hiring process, startups should start by defining an ideal candidate. This means that they should be crystal clear about why they want to hire for a role and the timing of that hire.
They should ensure that the job description is accurate and describes the role’s overall purpose and key responsibilities. Additionally, startups should always stay ahead of their game by identifying passive candidates with data aggregation and using AI and ML-based recruiting tools.
Lastly, they should avoid searching for top talent in the wrong places and instead focus on hiring A-players by investing in specialized software sales training rather than generic sales training.
5. Unrealistic goals
For B2B SaaS startups, setting unrealistic goals can be a common mistake. These goals can quickly lead to sales staff burnout and can be difficult to reach.
Examples of unrealistic goals for B2B SaaS startups include setting quotas that are too high and not based on past performance, not providing transparency about how quotas are determined, making changes to quotas without giving staff adequate notice, hiding product prices, and copying competitors’ pricing models.
Additionally, tracking the wrong metrics, having a content-thin website, providing poor customer support, and failing to push hard enough for a “no” when qualifying leads can all be missteps that lead to unrealistic expectations.
To avoid these mistakes, startups should prioritize forming a team from the moment they launch, set reasonable quotas that motivate staff, and be open and transparent with employees about their goals.
6. Lack of sustained sales efforts
The problem with sustained sales efforts for B2B SaaS startups is that they often make mistakes such as:
- Hiding their product prices
- Copying their competitors’ pricing
- Tracking the wrong metrics
- Having a content-thin website
- Providing poor customer support
- Not relying on direct feedback
- Creating marketing materials for the wrong product/people
These mistakes result in a waste of resources on customers who are unlikely to sign a contract, a lack of understanding of what’s working and what’s not, and inefficient utilization of distribution channels.
Furthermore, without a solid baseline of understanding, it is difficult to start doing digital marketing and to understand why one is being rejected, leading to frustration and eventually, giving up on the business.