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Why is Sales Outsourcing So Important for B2B Software Startups?

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In the past, many B2B software companies had internal teams responsible for business development and most start-ups begin selling without a sales team. 

These teams would be responsible for both strategic planning and tactical execution of lead generation, lead qualification, lead conversion and more. 

Today, however, more and more businesses are considering an outsourcing model, where one or both Marketing and Sales teams are outsourced to an agency with targeted industry expertise. 

For B2B software startups in particular, outsourcing sales can become even more important. With limited personnel, tighter budgets and rapid expansion plans, a startup business needs growth – fast – but may not have the people-power to drive it. 

In this article, we’ll cover:

  • The pros and cons of developing an in-house team vs. outsourcing
  • The value an outsourced sales model can bring to your B2B software business
  • How an outsourced team can ease some of the growing pains experienced by startups
  • How sales and digital marketing need to work together to deliver high-quality leads that enable your business to scale


The pros and cons of outsourcing vs. in-house teams


As a startup, you’re probably wondering which route is best for you: developing in-house marketing and sales departments or outsourcing. 

Here are the pros and cons of each:

 

Pros

Cons

  • You have direct oversight of the team and their activities
  • They are experts in your software and business
  • Devoted to your business only
  • Collegial atmosphere and team-centric model
  • High costs of recruitment, overhead, training, travel and compensation
  • High turnover rate in the SDR industry (read more about this topic here)
  • Many manual tasks take time away from sales – up to two thirds of an SDR’s workday
  • Longer ramp-up time – it takes months to see results for new marketing teams and sales onboarding is often slow
  • Might lack expertise to train new hires in certain areas

Pros

Cons

  • Access high-calibre professionals experienced in B2B software industry
  • Faster ramp-up from hiring to selling
  • Can receive dedicated reps
  • No overhead
  • Lower risk of turnover
  • Requires oversight from an internal team
  • Need to ensure data security
  • Requires budget


While it may appear attractive to keep Marketing and Sales teams in-house, building teams large enough to manage the volume of leads you require to establish and grow your business can be a challenge, especially in a short timeframe. 

Regardless of which option you choose, you’ll have to weigh the benefits against the cost. From overhead to training, compensation, and travel, internal employees are expensive. And in the competitive Sales Development Representative (SDR) industry, with up to 34% turnover every year, your costs to maintain a high-calibre team will increase each year.

That being said, it’s fun to work as a core team. Even if you decide to outsource, you’ll probably still maintain employees responsible for marketing and sales strategy and oversight. What outsourcing does is, it reduces the legwork and manual tasks required by your employees. Your team sets the strategy and establishes goals, and the outsourced team does the job of identifying, attracting and qualifying leads, passing them back to your team as Sales Qualified Leads (SQLs) to be converted into paying customers.


Side note: What is an SQL?
 

An SQL is a Sales Qualified Lead, which is different from an MQL (Marketing Qualified Lead). An MQL has seen your advertising material and possibly engaged with your brand, but an SQL has engaged with your brand, contacted your team and is looking to put budget and timelines behind their engagements. When you outsource sales, look for a partner who is prepared to deliver SQLs to your sales team, bringing you that much closer to conversion – stat. 

Read more about the difference between SQLs and MQLs here.


Why does outsourcing sales matter as a B2B software startup?

Attracting, qualifying and converting leads takes experience and industry know-how. As a startup, you don’t have a lot of money to invest in growing a team large enough to generate exponential growth, or the time it takes to bring them up to speed. You need to rapidly identify high-quality leads and quickly convert them into buyers, generating revenue and getting more companies using your software, spreading the word about your business. 

Outsourcing to an efficient, effective team reduces launch time for your product. Experienced, dedicated SDRs can drive fast growth at a time when you need it most, enabling your internal team to focus on higher-level tasks and strategies, closing the leads quickly when they arrive to you pre-qualified. 

An outsourced sales team can also be a temporary measure, used to generate fast growth while you build out an internal team. An experienced agency will help you build your sales infrastructure, supporting development of lead generation strategies, buyer personas, and contact databases to ensure you’re able to operate independently when your business is ready.


Is digital marketing enough to drive sales?


Digital marketing is a key element of your sales toolkit. It takes time to identify leads and begin a targeted lead-generation campaign, and is a big investment at the onset of a business. As you convert more leads and identify which activities help you acquire the type of leads that convert more frequently, you can strategically hone your audience targeting and your digital marketing will become more efficient. 

 A strategic marketing campaign is going to drive MQLs. MQLs need to be further qualified for sales readiness into SQLs that your sales team can convert with ease. When this qualification process doesn’t happen, your sales team will be spending their time on tasks typically done by marketing or chasing leads that aren’t ready for conversion. Not sure how to identify your MQLs vs. your SQLs? Read this article. 

When you choose to outsource sales, your sales team will receive SQLs that are ready to convert, giving your team the opportunity to do what they do best: close the deal. 

 
Can I have both an in-house team and an outsourced model for sales?
 

Yes! Your team are still the experts in your business and buying niche. 

Internal employees will lead the strategy, monitor and adjust KPIs, and close the sales, building those person-to-person relationships that you need to grow your business. The whole time, your outsourcing agency will implement your strategic marketing program, identifying and qualifying leads, and handing them off to sales when your team is ready to take over.  

When it comes to a shared in-house/outsourcing model, you’ll need to consider:

  1. Your budget – the cost of maintaining an in-house team vs. outsourcing, and how many employees you want to maintain in-house
  2. Your timeline – quick growth for your startup business might mean outsourcing, especially in the short-term, while you build your infrastructure and lay the groundwork for success 

 
Want to learn more about outsourcing sales for B2B software startups? 

 
At Hyperio.ai, we fuel your sales funnel with SQLs so that your team can close leads and drive scalable growth. Looking to learn more about how we put technology-driven campaigns to work for your B2B software business? Reach out to us – commitment free! We love talking about sales and are happy to have a no-obligation chat with you. 

 

Let’s talk about how we can help you grow your business.

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