When to hire your first VP of sales?

Pankaj Mishra


It’s amazing how just this one question can make or break a
company. What makes it even more frustrating is that there’s
already too much noise and clutter of answers on this question.
From founders, investors, to startup mentors, media and so on,
almost everyone has their perfect answer to this question. 


And still, many founders hire VP sales too early, or too late. A
rare few, Google for instance, get it right. Many others
including GitHub, which got acquired by Microsoft eventually,
didn’t get it right. 


So how to separate noise from signals that matter?


Enter Elad Gil, a serial entrepreneur and the author of “High
Growth Handbook”, a book that combines practical insights from
practitioners with some of the most visionary playbooks around
the world. Over the years, Elad has been an entrepreneur,
investor and advisor to companies such as Airbnb, Coinbase,
Checkr, Gusto, Instacart, Pinterest, Square, Stripe,  and
many others. 


In this podcast, the first in a series of deep conversations with
him on organisational building blocks, Elad offers practical
insights into some of the most common mistakes founders
make. 


When to hire your first vice president of sales, is among just
one such existential questions. 


“Some companies hire a vice president of sales too early because
they see that the market exists already. In other circumstances
when there is uncertainty, you start doing founder-driven sales,”
Elad says. “Many founders today, particularly product and
technical founders, end up adding sales and a VP sales much too
late in the life of a company.”


“What you’re increasingly seeing is that people are getting “pre
product market fit” advice to “post product market fit” their
companies. If you go back 5 or 10 years, it was the
opposite--people were given very bad advice. There was post
product market fit advice to a company that just didn’t have any
traction yet,” he adds. 

As you will discover after listening to this conversation with
Elad, there’s so much to learn from the playbooks of Google,
Stripe, Github and others. Elad also warns against learning from
the playbooks without understanding the contextual setting for
each of them. One size doesn’t fit all, indeed. 


So why do companies fail?


“The number one reason companies fail is because of the
“co-founder complex.”There’s always this advice that you need an
equal co-founder. I think people need to divorce equality in
terms of equity, from equality in terms of decision making,” Elad
tells me in this podcast. 


“For late stage companies, the common mistakes are very
different. Not building an executive team early enough, is the
first such mistake. That’s why when you see second time founders
start a company, among the first 15 people 3-4 of them are VPs
and CXOs.”