Feature

Is the Maritimes Struggling with Sales?

It seems like the Maritimes is bustling with entrepreneurs these days.

There’s no shortage of creative people with brilliant ideas and the drive to make those products and services a reality.

But some in the business community say there’s a shortage of people who can sell them on an international scale.

Emmanuel Elmajian is the CEO of Spinzo, a New Brunswick-based group platform for sports teams and venues. Though there are benefits to basing his company in Atlantic Canada, he says finding qualified salespeople in the region has been close to impossible.

“I would say in building up Spinzo we’ve had a hard time finding salespeople within the region to meet our needs … In order to sell our solution to the sports teams and venues, we must firmly understand their own sales process … so I found it very difficult around here to find people that have that specific experience,” he says.

“There’s sales, but sales is very domain specific. In this case it’s ticket sales, entertainment sales and promotional sales, so I found it difficult to recruit the sales talent.”

Elmajian says he was left with no other choice but to look elsewhere.

“I recently brought on someone in the United States who’s quite familiar with the sales process for sports teams and venues,” he says. “We did this because quite literally we can’t find a equivalent of this person in the Maritimes.”

Going outside of the region to find sales talent meant Spinzo had to give up some incentives, including a grant that would have helped pay for an employee from New Brunswick.

“The grant pays for a moderate amount of someone’s salary and it’s a incentive to hire locally,” Elmajian says. “I’d love to use that incentive, but if we can’t find the talent locally, then we have to let go of that incentive.”

Though the optimal choice would be to hire salespeople from the region, Elmajian says despite the financial incentives, he isn’t going to take a gamble with such an important part of his business.

“I have a duty for my company to chase the ultimate talent required for us to succeed and if that talent is not here, then I have to look elsewhere,” he says.

“If there is better talent elsewhere, but here there is a grant associated with it, some companies will opt for that approach. But do you run the short game or the long game? In the long game, you want to have the best talent to help sell your technology.”

Elmajian isn’t the only who sees lack of sales talent in the Maritimes as an issue. Gerry Pond, co-founder of East Valley Ventures and Mariner Partners Inc., notices it as well and has been leading conversation on the issue.

Gerry Pond

Gerry Pond

“We’re (East Valley Ventures) on about our 45th startup and the common pattern with some of those is the inability to sell internationally,” Pond says.

Though the problem may seem particularly pertinent in the Maritimes, he’s says it’s also a Canada-wide issue.

“In measuring that with other experiences others have across our land in the accelerator world, whether it’s at Waterloo or B.C … everyone agrees that sales, particularly international sales is a weakness in our sector (startup ICT) but it’s also a weakness in other businesses as well,” Pond says.

Though there are good sales people in the Maritimes, most of them are already working for more established companies. This makes the issue of sales particularly difficult for newer companies.

Al Sturgeon, entrepreneur in residence at Propel ICT, has worked in both engineering and sales for over 20 years. He also sees sales as an issue for the the startups he works with.

“What I find in Canada compared to the U.S. is what we want to do is perfect the product, the company, the offering and the stories. So not only is it legitimate but it’s so awesome that we don’t have to sell, which is interesting,” Sturgeon says. “But by not selling and marketing, you end up losing the market, because people in other areas are a little more aggressive and they get the sales and marketing early which they feed their pipeline way before they got the product done. Or they sell on the promise versus what they’ve done.”

“Specific with Atlantic Canada, I think it’s even more so because we never really had a lot of support outside (the region),” he says. “The interesting thing is from an entrepreneurial mindset, we are awesome and incredible, but that doesn’t always translate into sales and marketing.”

What are the solutions? 

Pond says many salespeople in Canada get their training through American-based companies like Sandler or in-house by their employer. But he says in-house training is a luxury many Canadian companies don’t have.

“In Mariner for example, our sales people were all trained in the United States by large American Companies like Cisco, for example, and trained in-house. Most Canadian companies don’t have that capacity to train-in house and don’t do it,” Pond says. “Even if they are trained by large companies, they’re not certified. They’re certified in that they have a piece of paper saying they went through their courses, but they’re not in a professional category like all the other professionals.”

Pond believes one solution to help create and grow sales talent in the Maritimes is to establish a proper program at a post-secondary institution in the region.Business-heavy

“I thought based on the size and deepness of the problem, that we should go for a more professional approach and take a page from other professions, whether it be lawyers, accountants … and establish an undergraduate degree or masters degree and some level of internship to grow more of our own quality sales people.”

Pond says he presented this idea to the Association of Atlantic Universities in February 2015. He also offered to help fund such a program.

“I said ‘I think our solution to growing our economy in Atlantic Canada is selling more of our products and services from the new company standpoint, from technology companies that I’m involved with, but also from all the other types of businesses that are here. I propose we establish a degree program at an Atlantic Canadian University, and I’m prepared to donate $500,000 to do that,’” Pond says.

“I still have my money.”

There’s research to support the importance of sales in helping businesses succeed. One study has shown that “business-heavy” founding teams (as opposed to tech-heavy teams) are 6.2 times more likely to successfully scale with sales-driven startups. A 2009 study of 18 Canadian tech company failures found “no urgency to achieve sales,” but all said companies had a significant number of employees working in research and development. R&D is great, but doesn’t help sell the things you research and develop.

Pond says he has spoken to most of the universities and most cite reasons like lack of funding or teaching staff for not being able to establish such a program.

“Most of them said they would do it through an institute. Which is code for they would have a certificate program” he says. “The private sector colleges said they would do it if I would fund them, and we haven’t got anybody that meets my criteria yet.”

But that’s not to say Atlantic post-secondary institutions don’t pay any attention to sales at all. For instance, the University of New Brunswick’s Saint John Campus just added a sales course to its MBA program. Moncton’s Oulton College provides a business marketing program that also has a sales component. Both UNB and St. Mary’s University have Technology Management and Entrepreneurship masters program, but based on the program course descriptions online, there doesn’t appear to be a designated course for sales.

Though the lack of action from the universities may seem discouraging, Pond says he thinks the idea of a professional sales program will catch on, just as the idea of an entrepreneurship program did.

“I think it’s going to take two or three more years at the minimum.”

For Sturgeon, some of the problem also lies in misconceptions about sales.

“People see sales and marketing as a bit of a black magic or just greasy and dirty.” he says. “And it can be if you think of traditional sales from years and years ago.”

There’s also the fact that entrepreneurs are often so focused on problem solving that sales and marketing are the last things on their mind. Sturgeon says a lot of tech startups don’t realize they can sell the value they’re creating.

no-urgency“I think technical people or people who build their businesses are always thinking ‘I’m not the sales guy” when in fact they are, but they aren’t trying to sell,” he says.

It really boils down to confidence.

“That’s where I think the challenge is, people think ‘I’m not a salesperson, so I need to hire a salesperson.’ And what they end up doing and they may have hired somebody who has done sales, but doesn’t do the type of sales they need. There is such an education element of people understanding,” Sturgeon says.

“Don’t just say ‘sales,’ understand what you mean. Are you selling a new product in a new market, Or a new product in an existing market? You need to understand what you’re selling to whom, and then you need to get that right sales process.”

Startups in the region can also get stuck in the cushy comfort zone of Atlantic Canada and the local market. Though the Maritimes is good in the fact we “support our own,” that give companies a false sense of security.

“What happens though in New York, Boston or California, they don’t give a shit about helping people. What they want to do is make money,” Sturgeon says.

Atlantic Canadian Companies need to be aggressive when it comes to breaking into the international market. If you want to be with the big players, you need to act like one.

“The people who are successful actually go into those markets and they don’t play the local card . . . You’ve got to go in like you’re big. You need to be confident,” says Sturgeon. “I tell everybody who goes through Propel ‘You need to be your biggest cheerleader and you need to ensure the passion that’s always provided you to wake up and do what you do is conveyed to your clients.’”

Like Pond, Sturgeon also thinks a proper sales program could be beneficial and something post-secondary institutions need to focus on.

“It can’t just be business. It needs to break down the silos of business specialties. Are you taking a sales path? If so, are you looking to go into lead generation, which is early level sales, or business to business, which is very different?” he says.

“There’s all of these different levels of what people need to know, expect and how to navigate it and it needs to drawn on experience from people who have actually done it and then provide it to these students going through.”

Startups are working with what they have

Though it’s no walk in the park, some Maritime startups are getting by and growing without local sales talent.

Fredericton-based Welltrack discovered the secret to nailing down sales was finding the confidence and learning how to do it themselves. COO and co-founder Natasha O’Brien says she was, and still is, WellTrack’s primary sales person

“We have in the past tried to hire sales talent and I think the biggest issue was that we were too early. We were trying to hire sales talent because we didn’t have the confidence and we didn’t believe we could actually get the job done ourselves,” she says.

“I think as founders, you really have to focus on trying to sell your product and get to that product market fit as quickly as you can. I think you have to do it yourself before you can bring someone in.”

Last year O’Brien says the company was closing about 10 per cent of the leads they were generating. Today that number is at 30 per cent.

“Now that we have a sales process we know that works, we need to figure out how to automate certain aspects of that so we can do more with using as few resources as possible,” she says.

This means taking another crack at hiring some salespeople.

“We are now looking at hiring salespeople in the near future. We have been able to identify some talent locally that we believe will fit our needs,” O’Brien says. “We will have to train this person or people on how to sell our product, but believe that we are in a better position now to be able to do that successfully.”

For Saint John-based Siteflo, leveraging their mentor and support networks has been key is securing good sales talent, talent that’s willing to work for a startup where the compensation offerings can differ from more established companies.

“The package you might deliver to a talented sales resource in another market might be dramatically different than the offer and the compensation they could receive from somebody else … You’re sometimes disadvantaged,” says Siteflo CEO Brent MacDonald. “You’ve got a certain type of offer you can make and there are a limited group of people you’ve got to make that offer to, who might be attracted to what a startup has to offer.”

MacDonald says most startup founders have zero experience in international sales, so when it comes to hiring someone who can do that, relying on investors and mentors can be extremely helpful.

“Today our vice-president of sales is somebody I was introduced through an investor who I really trust. I didn’t have to rely on my sole ability to evaluate whether or not they were going to be a good fit. Ultimately it has worked out really well,” he says.

“I think it gets at the core of the problem particularly for startup founders who don’t have experience with international sales. We’re often relied on to make a good decision about who’s going to be a talented salesperson or executive without having the pedigree to make that decision.”

Like Emaljian at Spinzo, MadDonald says looking outside the region for sales talent is necessary.

“We should be looking elsewhere for sales talent in Atlantic Canada. We should be looking not just within our borders to source sales talent, because the talent pool is bigger, the depth of experience is there and the reality is a lot of companies who’ve scaled have done that well,” he says.

“I think we need to look outside our of our boarder for sales talent to complement the skills we have here to grow the teams that we have here.”

So … what do we do now?

It looks likes it will be a while before we see a professional sales program in Atlantic Canada.

Sturgeon says in the meantime, organizations who help startups and entrepreneurs need to offer programs for people interested in learning sales. Propel ICT does this already with their participants, but it needs to go beyond that.

“You’ve got the ability to start to offer augmented programming,” he says. “It’s up to the community to lead that, to say ‘here’s an offering, it may not be perfect, but here’s where we’re starting.’”

Sales might seem uncomfortable and out of your element, but the bottom line is that if you don’t have good sales, your company won’t succeed or scale.

“Everybody should be accustomed to knowing why sales is so crucial. You can have what appears to be the most successful marketing campaign, but if your sales team can’t close the business, it doesn’t work. No matter how good the product, or the customer service,” Sturgeon says.

“All of this doesn’t matter if you can’t close business.”