There are consequences to hiring talent who have a shorter shelf-life than a fast-food burger: Time, dollars, and investor patience are at stake: Making the wrong choice can waste 9 to 12 months of runway and opportunity costs that top a million or more.
And for digital health startups, failure hits even harder: 9 in 10 of them die before five years—often because the “break things” sales rules of tech startups don’t wholly apply to healthcare, which reckons with added pressures of regulations and change-adversity.
So yes, things look bleak. At the same rate, hiring the right people at the right time can pay dividends. How do you do that? These tips may help:
Do the gritty stuff first.
The right person can fail if they’re thrown on the hotseat at the wrong time. Most often, that means too early, rather than too late.
A decade ago, the Startup Genome cited premature scaling as the top reason startups fail. Within their 60-page report, anecdotes from seasoned entrepreneurs warned of rushing to hire sales leaders before the vision and product-market fit took shape—and mostly, of mistaking early adopters for sustainable business instead of taking time to feel out the cycle and pluck talent needs from there.
We’ve seen this even now with clients who come to us—and most of the time, the problem links back to investor pressure. Venture capitalists make an investment with a heightened valuation and aggressive revenue target. Then they check the tired old VC playbook, which says they need to hire a head of sales, and fast. So they do.
But that skips over the foundational self-discovery work that every health startup should do before they hire sales talent—like developing product-market fit, pipeline, and process to make it all come together. Doing this messy stuff takes time, but also shores up the odds that you’ll learn what and who you need, and why.
It also builds a more compelling case to attract the right sales leader when the time comes to hire them. That is, if you can find them
Hire who you need, not who you want.
Big-name brands and elephant wins are seductive skills on paper, but they don’t always translate for a scrappy startup poised for growth. Often, those sweet-talking sales leaders do best as cogs in a legacy machine. They may be highly effective, but they’re cogs nonetheless.
Startups need someone with a bias for action outside of that “safe” choice—someone who can boldly bootstrap a sales engine from scratch and keep up with the fast pace and changing demands of an early-phase, high-growth company. Mostly, startups need talent who learned those skills on someone else’s dime so that they provide value on Day 1.
Those unicorns take time, cash, and a convincing sell. For starters, most proven sales leaders will command $250K base or more—and you’ll probably have to poach them away from gainful employment with a strong story, product-market fit, and pipeline so they feel confident making the jump.
It’s a slow process that can take months when done well. Be highly selective and look for startup all-stars who can recognize patterns in the pipeline, anticipate market changes, and understand the beautiful chaos that is healthcare.
Sound easier said than done? You’re not wrong—which gets us to #3.
Work with a partner who understands digital health (that’s us).
Whichever mix of partners you engage with for commercial consulting, venture capital, and executive search (Phase2 can help with all three), ensure that they’re all deeply entangled in healthcare and mission-driven. You shouldn’t have to explain the mechanics of care delivery or key stakeholders like physicians or payers. The right partner will already know the context—and will help you place someone who does too.
There’s another layer to this, though: Many hospitals and other customers got jaded, burned out, and cynical about technology after failed promises over the past decade. The burden of proof for new health solutions is miles higher than it used to be, which means one bad investor relationship can spoil everything.
Such is the pain that non-healthcare VCs, search firms, and advisory groups can inflict, which is why we take a different approach. We only work with digital health companies, and we know the industry inside and out—including how to match the right leaders with the right opportunities to change healthcare for the better.
After all, we’ve hired hundreds of healthcare salespeople out of a candidate network fueled by thousands of conversations each year. We’ve seen what works, what doesn’t, and why—and we can guarantee you better odds than a 1-in-4 success rate.
Ready to build your sales team? Reach out with your biggest recruiting pain point. We’ll get started on a customized solution for you.