Sales Learning Curve

I love this often overlooked paper by Mark Leslie on the Sales Learning Curve.  Mark was the founding CEO of Veritas and as Ross Mayfield so eloquently wrote, "turned a $6 million investment into the 5th largest software company in the world."  Since then he as been teaching and investing, both well I'd bet.

In his work he compares a startup's go-to-market strategy to the manufacturing learning curve, which, in a nutshell, states that unit cost dramatically decreases as volume increases.  Similar to how manufacturing companies prepare for and anticipate this learning curve, he stipulates that start-ups must follow a sales learning curve as they bring their product or service to market.

Most early stage start-ups have a slick Excel spreadsheet showing how they plan to add sales staff, ramp smoothly up to quota over 6 to 12 months and reach break-even in 18, 24 or some other amount of months.  In reality, sales during the initial market introduction phase is mostly uncorrelated with sales headcount.

Folks who get the sales learning curve staff lean in those early days.  They orient and focus the entire organization around learning what and how the customer buys their product (not how they sell it).  Product, engineering, sales, marketing, accounting, HR--the whole company--need to participate in this process.

Mark also gets really practical in his work in providing specific metrics to determine where a company is at on the sales learning curve.  I think this is truly seminal work that will one day be viewed in the same way Deming is revered in the manufacturing world.