When Should an Agency Hire Its First Salesperson?

I've watched a few agencies fire and re-hire business development people two or three times before they realized it wasn't a hiring problem. Each new person had the same problem: the proposals only worked when the founder explained them, and buyers still wanted to hear it from the founder.

If your agency is past $2M in revenue and you still take most first calls, decide what a new hire gets handed on day one before you decide when to hire: the questions you ask on a first call, your answer when a buyer pushes on price, and the reasons your best clients picked you.

Key Takeaways

• Hire your first salesperson when sales meetings cost you delivery time, your pitch and objections repeat, revenue would stop if you stopped selling, and your sales process is documented well enough for someone else to run it.
• Hire a builder first: someone strong at discovery who turns what works into a playbook.
• Published pay plans for an agency's first sales hire pair a base salary with commission and warn against commission-only roles.
• When a business development hire isn't producing, fix the proposals, discovery script and referral path they're running on before you replace them.

Should you hire a salesperson or keep selling yourself?

Keep selling yourself until the basics are documented: your discovery questions, your answers to common objections, your pricing and your deal stages. Even after you hire, you'll stay on some deals, and the job is deciding which ones.

In an agency's early years, the owner usually finds, pitches and closes nearly every client.

Karl Sakas of Sakas & Company separates two versions of that in his guide to delegating agency sales. Founder-led sales, in his definition, means "you're intentionally involved where you add the most value: strategic-fit calls, high-stakes opportunities, final closing conversations, or long-term relationship discussions." Founder-dependent sales means "the agency can't reliably move opportunities forward unless you personally drive the process."

Sakas's distinction tells you what a first salesperson is for. An agency can stay founder-led for as long as the owner wants to sell. Founder-dependent sales is the condition a hire is supposed to end, and a new person can't end it while every deal still needs you to move it forward. Sakas describes the goal as "a sales process where your involvement is intentional," and a hire gets you there only once that process exists.

How do you know your agency is ready for its first sales hire?

Your agency is ready when four things are true, and the last one decides it: your sales process is documented well enough for someone else to run it. The four signals come from my guide to founder-led sales.

The four signals

• You can't take a sales meeting without dropping something in delivery.
• You've closed enough deals that the pattern repeats. The pitch is consistent and the objections are predictable.
• The pipeline depends entirely on you. If you stopped selling, revenue would stop.
• The way you sell is documented: scripts, objection responses, pricing logic and deal stages, complete enough for someone else to run.

If the last one is missing, you're not ready.

Why "it's all in my head" stalls the first hire

A founder sells using knowledge they've never had to explain to anyone. Nicholas Kirchner of Hydra, an agency growth firm, says in Hydra's guide to getting the founder out of agency sales that the founder outsells a new hire because of three things the hire doesn't have: "which prospects are actually a fit, what the answer is when someone pushes on price, and the authority to change scope."

Without those three things, a new hire either waits or improvises. Sakas warns that your new salesperson "may wait for you to fix the process," or build their own version that doesn't match how your agency sells.

Before anyone new starts, document five things:

• Your discovery questions and what each one is meant to find out.
• The objections you hear most, with the answer you give to each.
• Your pricing tiers and how you package the work.
• A proposal template that makes the case without you there to explain it. Why agency proposal templates lose deals covers what to check.
• Your deal stages, with the condition a deal has to meet before it moves to the next one. The six stages of an agency sales process give you a starting shape.

Getting this out of your head takes time you don't have. The practical way is to capture each piece while you're still selling, one deal at a time, starting with your next discovery call.

Which role should an agency hire first?

Hire a builder: someone strong at discovery who can take your documented basics and turn them into a full playbook. Some agencies get more from a delivery lead who frees the founder to sell, or from a fractional leader who runs the pipeline until a full-time hire can.

Hire a builder who can write the playbook

Hiring for closing ability alone is the common mistake, because there's nothing finished yet for a closer to close. You want someone curious and coachable, strong at discovery, and willing to turn what they hear on calls into the playbook your next hire will use.

Commenters on Reddit give the same advice. One of the top replies in an r/Entrepreneur thread titled "Should I hire a sales agent for my Digital Agency?" told the owner to "keep selling as long as you can and look for that person that is willing to help you build."

Business development rep, new business director or account growth lead?

These three titles describe different jobs.

A business development rep finds and qualifies prospects, books first calls and runs early discovery. Sakas puts "first-pass qualification" second in his order of what an owner should delegate, right after sales support and admin.

A new business director owns the agency's new business strategy, prospect targeting and pitch process. The IPA's description of the role says the director is "responsible for creating the new business strategy" and is "often the first point of contact for a potential client."

An account growth lead grows the clients you already have. According to the IPA, some new business roles carry that work too, with "responsibility for generating the organic growth of existing clients."

If the job taking up your week turns out to be marketing, the first marketing hire is a different decision with its own guide.

When a delivery lead should come before a salesperson

Sometimes the right hire is a strong delivery lead who runs client work so you can keep selling. If buyers still want to hear from you and deals close when you're on the call, a strong delivery lead may free more selling time than a salesperson would.

When a fractional leader makes sense first

A fractional leader runs the pipeline while you stay on the calls that need the founder. It fits when the sales process still needs building and you'd rather a full-time hire start once the playbook exists. Schmidt Consulting Group's Fractional Partner engagement works this way: a senior operator leads growth from inside your agency and builds the targeting, outreach and follow-up with your team.

How should you pay your first sales hire?

Published pay plans from people who write about agency sales pair a base salary with commission, and all of them warn against commission-only roles. Each figure belongs to the person who published it.

Karl Sakas describes "a more typical agency sales comp plan" in his article on commission-only salespeople: a base salary plus about 10% commission in the first year and perhaps 5% in later years, paid monthly, with a sales quota. He's skeptical of salespeople who pitch commission-only deals to agencies, because "good salespeople have options, including demanding a base salary." He also notes that agencies often make their first sales hire at around 20 or more employees, sooner if the owner hates selling.

Erik J. Olson, who builds and runs several agencies, shares the plan he uses "at my agencies" in The Business of Agency. Each account executive gets a base salary plus 7.5% commission on monthly recurring revenue in the first year, 2.5% in the second year, and nothing after that. Project work earns 2.5% flat. He says the drop-off "pushes them to keep hunting instead of milking old clients." He's blunt about commission-only, too: "what you save in cash, you'll burn in time."

Practitioners on Reddit push back on commission-only roles just as hard. In an r/sales thread started by the owner of a small consulting firm that serves SaaS companies, one reply read: "If you don't offer a base pay capable of supporting the sales rep until they ramp up you won't find anyone of any quality." Another put it more simply: "If you can't sell your own product then no other sales person can."

Whichever plan you study, measure it against the job you're hiring for.

How do you hand off agency sales without losing deals?

Hand off in stages, and give each stage time to work before the next one starts. Deals get lost when a founder hands over the whole process at once and then has to step back into every call.

Hydra's guide lays out four stages for moving sales off the founder:

1. Document while you're still selling. Hydra suggests recording twenty calls and noting the structure you follow, the objections you get and what you say to each.
2. Hand over discovery and keep the close. The new hire runs the first call, and the founder joins the second and closes.
3. Hand over closing on smaller accounts, below a threshold you set.
4. Hand over everything except the largest accounts.

In Hydra's view, the fourth stage is a reasonable place to stop for good, and founder involvement in the top accounts is "a feature." Hydra also warns that "close rate will fall" along the way and tells founders to build the pipeline to absorb the dip.

Jody Sutter of The Sutter Company draws a similar path as a pyramid in her post on letting go of owner-led business development, from 100% owner-led down to 10%. In her version the owner still does half the selling past the 10-person mark and a quarter of it at 25 or more people. She presents the pyramid as theoretical.

When I rebuild an agency's pipeline, three changes let deals move without the founder:

• Proposal templates get rewritten so the case for hiring you doesn't depend on the founder's verbal framing.
• The discovery script changes so the business development hire can pre-qualify fit before a deal reaches the late stages.
• Requests for warm introductions get routed through clients and partners instead of the founder's LinkedIn.

Document how a lead moves from whoever finds it to whoever runs the first call, and which notes travel with it. The rules for handing leads between marketing and sales apply between you and your first hire.

What if your business development hire isn't producing?

Fix the setup before you fire the person. A business development hire who isn't closing is usually the right person running on a setup that only works for the founder.

The usual case is a hire eight months in with no closed deals and a pipeline that looks full while the deals don't move. Three problems cause it. Proposals only work when the founder explains them, buyers still want to hear it from the founder, and discovery calls turn into price-shopping when the founder isn't on them.

Firing that person and hiring another puts the new hire on the same proposals and discovery calls, in front of buyers who still want the founder. My Agency Pipeline work fixes those pieces first, then lets you see what your current hire does with them.

Business development hires I've worked with through this rebuild have often been the most relieved by it. They knew the job they were trying to do wasn't built for anyone but the founder, and they couldn't say that to you.

How will you know the hire is working?

Four numbers tell you whether deals are moving without you:

• Founder-call rate: how many sales calls still need you on them.
• Close rate on deals you didn't lead.
• The share of discovery calls that meet your fit bar.
• How many active deals needed you to step in.

Read them together. A rising close rate on deals you didn't touch is a good sign, though it can also mean the lead mix shifted or the deals got smaller.

My target is a full quarter in which the founder never gets pulled back in to rescue a deal. Judge the trend over more than one quarter, with enough deals for the numbers to mean something.

All four numbers depend on pipeline visibility: every deal in one place with a stage, a next step and a date. If deals still live in email threads, choose a CRM your team will keep updated before the hire starts.

How does Kurt Schmidt help agencies make this hire?

I help agency owners document the sales process a first hire can run, then move deals off the founder in stages. I'm Kurt Schmidt. I was President and Partner at Foundry, a Minneapolis custom software and digital product agency, and grew it from 3 people to about 50. Foundry made the Inc. 5000 in 2020 and 2021. I've advised more than 150 agencies.

One of the agencies in my client results, a branding and creative firm, came to me with a $600,000 gap between where revenue was heading and where it needed to be. Deals lived in notes and an email tool, and the pitch changed depending on who was asking. We interviewed six of the agency's clients about why they buy, rebuilt how the agency describes its work around those answers, and put every deal in one place from first call to signed contract. Partway through, the founder cut the gap to $350,000 on a call: "you can put a strike through on 600 and put $350k." The agency's sales forecast went from $30K to $250K in 30 days.

There are three ways to work together. In Mentorship, you get twice-monthly counsel on pricing, hiring, clients and direction, and you do the work. In Advisory, you work from a written plan one priority at a time, with deal reviews when a deal is live. As a Fractional Partner, we lead growth from inside your agency.

If you're weighing this hire, Book a Call. It's a working conversation about your next step: hiring now, or fixing the setup first.