Founder Log · HP Lessons 1
The Sales Funnel: Which one actually generates revenue?
Amice - The Junior Salesperson
My first role in B2B sales started in Hong Kong at a startup selling security solutions to government departments and FBI clients (financial institutions, banks, and insurers).
Our competitors were giants like IBM, PCCW, and a few other US technology companies.
Wonder why government departments and FBI would consider solutions from a startup like my company? We did have our unique selling point (USP) - a strong technology incubator supported by university professors.
Anyway, being a new and much smaller player, our actual chances of winning deals relied heavily on our sales team - how we managed the selling cycle.
The CEO - A Senior Enterprise Sales Manager from US
I was the most junior salesperson, and the whole sales team was onboarded on the same day. Our CEO was not the founder. He joined the company a few months before we did. Before joining the company, he was a senior sales manager at HP in the United States. His key roles as a CEO were very clear - sales team management and building a revenue generation engine.
Honeymoon - Sales Onboarding & Product Training
The sales team enjoyed a roughly 2-week “honeymoon” onboarding period — team lunches, product briefings, strategy planning sessions, etc.
The CEO tested our product knowledge by having each sales rep present our security solutions, which was a whiteboard presentation in front of our developers and engineers. Coming from an engineering education background, I articulated our technical solutions with confidence. Our CEO was satisfied. I felt ready to enter the battlefield - sales outreach.
Entering the Battlefield - Outreach
The security solutions market at that time was not as saturated as it is today. Most companies were curious about solutions in security (remember: “curious”). The company received phone and email inquiries pretty often.
I was assigned several sales leads from local financial institutions.
BTW, I felt lucky that I did not have to do the cold calling, which I believe most salespeople hate. However, later in my career, cold calling and even “catching” my target clients onsite can be crucial for increasing your win rate dramatically in the sales cycle. I will share my experience in coming articles.
Alright! Back to my assigned leads: I did my “homework” - prepared for my meetings by checking clients’ websites and news - then picked up the phone, made the call, and arranged meetings with the clients.
My FIRST Most Important Sales Lesson
Everything seemed smooth until one day - I returned to the office after my client meeting. I felt like I was a diligent and effective salesperson. However, my CEO was surprised that I met the client. He was obviously annoyed.
“Amice, how can you meet the client without any preparation?!”
“Well...I have done some digging online before going out,” I replied, puzzled.
I was thinking, what kind of 'preparation' does he mean?
“You have a lot of spare time?” he snapped.
“Ar.....sorry, what do you mean? What is the issue?” I was still puzzled.
“Let me tell you. You are wasting your time!
Your time is an expensive company resource.”
I thought: “Isn’t meeting clients the job of a salesperson?” | ‘_’ |||
The Math of the Selling Cycle
He sat me down and explained the math of a typical B2B Sales Funnel:
pitch → needs discovery → proposal → objection/negotiation → deal
— The “Selling Cycle”.
He said, “If you want 10 clients to give us business, and assumed 50% chance to proceed to each next step, you will need to pitch : 10 x 2 x 2 x 2 x 2 = 160 clients.
Don’t forget we assume optimistically 50% each stage!
What about the chance to move to each next step of the selling cycle drops to 33%?
You will need to pitch : 10 x 3 x 3 x 3 x 3 = 810 clients."
He continued, "Today, you are starting with such an approach.
You will never succeed, Amice.”
I was totally speechless. I suddenly felt I had picked the wrong role in my career. | ‘_’ |||
The Skinny Funnel Strategy
He comforted me, “We are not targeting this.
You don’t need to do 810 sales pitches."
He started drawing a second funnel on the whiteboard (see my sketch below) and explained,
“The first and most important step in the selling cycle is to disqualify leads as early as possible.
By drastically narrowing the top part of your sales funnel (Lead Qualification), you save your most important resource as a salesperson: Time.
But the time saved is not for you to relax, Amice. Instead, it is to be invested in high-value sales pipelines to enhance the chance of closing the deal.”
Amice's Key Takeaways
His way of selling
selling me on his methodology
- I felt I was a “great” salesperson.
- But he analyzed my situation scientifically.
- “810 clients” — a concrete number.
- It pushed me to think: “I need a solution,”
- then he showed the path.
It is SPIN Selling as I learnt later in my career — will share more in upcoming articles.
Qualification and Disqualification
in the early stage of the sales cycle
When we "sell harder" (the wide funnel), we burn out.
When we "sell smarter" (the skinny funnel), we focus our energy on the deals that have a real chance to close.
Follow My Journey
I am going to share more from my 20 years of enterprise sales experience, as well as the sales methodologies - the science of selling.
Please follow my journey here at Closmore.com, and my LinkedIn/Amice Wong.