It’s so important to spend time focusing on the right opportunities. Time spent in the wrong areas as a founder comes with a huge opportunity cost. And that’s why founders need to have a clear framework for qualifying opportunities.
Bad qualification can result in bad product development
In addition to the wasteful use of time from inadequate qualification, there are product implications to think about. I often see early stage companies working with clients that are a poor fit, and that results in the company developing its product around those clients’ specific needs. This leads to building a very niche product for a small segment of customers that can’t be repeated or scaled up.
It’s crucial to take a big picture view and consider what you’re creating, who your target audience is, and what issues you’re addressing for the total market you’re aiming to reach. Focusing too narrowly can cause you to lose sight of the broader goals and customers. By zooming out and keeping the full context in mind, you can build things that truly solve key problems for the people you want to serve.
Qualification frameworks
Process creates repeatability in sales and using a qualification framework will help you ensure you’re spending time in the right places. They also help you determine whether the prospect will turn to a customer or not. The frameworks I have found most effective are:
- BANT – Budget, authority, need, and timeline. This framework is developed on a stakeholder-level lead qualification process and revolves around the buyer’s persona.
- CHAMP – Takes a customer-centric selling approach, helps reps ask relevant questions and allows them to tailer the sales pitch keeping customer requirements in the first place
- ANUM – This is similar to BANT and determines whether the SDR is talking to a decision-maker prospect or not.
- FAINT – Looks at companies that have the capacity to buy the product and services.
There’s loads out there, but it’s really important to build your own sales framework or methodology to help you qualify an opportunity so that when you get a lead in or when you’ve got someone in your pipeline, you can quickly determine whether they’re a good fit. And crucially, you can disqualify opportunities very easily because it doesn’t meet your qualification criteria.
As a result, you’ll be able to spend time in the right places, win the right customers, and also win more of the right customers because you end up with more case studies, more referrals from those other well aligned people.
Poor qualification doesn’t just impact the founder
It’s not only the founder that touches opportunities. It could also touch product or customer success. So everything that goes in the pipeline is sucking up company time. So you’ve got to be very careful about what goes in there. It’s much more efficient to have fewer well qualified opportunities than a big pipeline of opportunities that will just waste time across the business.
Determining budget and financial viability
One of the biggest skills when you’re selling is simply not talking. The best salespeople ask lots of questions and are naturally curious. So good qualification involves lots of questions, and even more listening.
Over the years I’ve found it’s actually easier to get the truth from prospects before they see the product. Don’t do demos to time-wasters. But how do you know who is and who isn’t a time waster? Questions.
- Who else needs to be in the buying process?
- Who would be the person signing the contract?
- Who would need to be involved in seeing the demo?
You need to be aware if your prospect can’t sign a contract. The account could be an opportunity, but that person that you’re speaking to is not qualified. And it’s your job as the founder to bring the right people together to sell to them. Remember, more often than not, one person can’t make a decision by themselves.And your point of contact is pigeonholing you and you’re stuck with that one person, the reality is your probability of converting that opportunity is very slim.
So you then need to identify the right people.
If you have a clear framework, you can go through it methodically, ticking off boxes along the way. In most CRMs, you can set mandatory stages so that when you move from discovery to demo, for example, you’re prompted with checklist items like “Do we know the economic buyer?” and “Do we understand the buying process?”. This reminds you to pause and make sure you’re actually ready for the demo stage, instead of rushing ahead. If key information is missing here, you can always schedule another discovery call.
I see too many founders without that structure, and as inexperienced sellers they tend to hurry opportunities through the pipeline prematurely.
It’s crucial to properly qualify leads because misalignment between the sales process and buying process causes fundamental problems. For instance, if the seller thinks they’re at proposal stage but the prospect is still at the tire-kicking stage meeting random vendors, there’s misalignment. The seller is chasing a contract while the prospect is just starting their research. This leads to missed steps and information on the seller’s side, because they mistakenly believe they’re further along than they really are.
Slowing the sales process down
I’ve seen thousands of pipelines over my career and what I see too often is salespeople rushing the discovery stage and not asking enough questions. In short, that’s why the vast percentage of opportunities get get stuck or lost.
The key to successful sales is to slow down in the beginning and ask all the hard-hitting questions to qualify potential customers in or out. This will help you avoid wasting time on deals that are unlikely to close and help you focus on the ones that have a higher probability of success.
Discovery stage questions to think about:
- What are the buyer’s personal motivations for buying your product or service?
- What are the real business challenges that your product or service can solve?
- Who is the decision-maker, and who else needs to be involved in the buying process?
- What are the buyer’s budget and timeline?
These will give you a clear understanding of the buyer’s needs and challenges, and determine if your product or service is a good fit. Then you’ll close more deals and avoid wasting time on dead ends.
Uncovering objections
I don’t see objections as a negative. It means that you’re communicating with a prospect and you’re getting valuable insight into their thought process. They’re not buying right now because they have concerns, and your job as the founder is to address those concerns.
Instead of being defensive, view objections as opportunities to refine your pitch and messaging. Don’t immediately offer discounts or changes – that’s a slippery slope. Explain the reasoning behind your product design and roadmap, and use your case studies to highlight how it benefits other users.
You can read my article about Turning Objections into Opportunities here.
Author: Matthew Codd
I’m Matthew, I have 15 years of commercial leadership experience, helping VC-backed B2B technology companies scale revenue and transition from founder-led sales.
I use my experience to help early-stage start-ups with GTM expertise, sales best practice, and hiring insights.
I co-founded Cosmic Partners in 2022. We are SaaS sales recruitment specialists for VC backed B2B tech companies.
