If you’re an engineer-founder dabbling in sales for the first time, you’ve probably encountered the world of prospecting: how companies employ teams of SDRs to research and reach out to target customers. Though the SDR “body shop” is standard at technical companies today, I’d argue that this is going to change. Prospecting is actually an engineering problem, and founders should think about it like a configurable, tuneable pipeline.
How prospecting works today
For technical founders new to the sales game, you might not be familiar with SDRs and what they do – although you’ve certainly gotten an email from one of them. So allow me to give you a tour of what your future sales organization might look like a year or two after you find product market fit.
Founders typically start to hire for sales when they have the first inkling of product market fit. We recommend founder-led sales up to this point, but you’ll need someone to delegate to once you’ve built up momentum.
The preferred hire is usually a seller with several years of experience selling products in a related domain (definitely a technical one). This person validates the founder’s thesis about who the ICP is, what makes the product valuable, how long it takes to sell, etc. Once all of that is ready to go, it’s time to scale things up and build more pipeline. And this is where prospecting and SDRs come in.
SDR stands for Sales Development Representative. You’ll also sometimes see them called BDRs (Business Development Representatives). Their job, in most cases, is to get meetings with prospects. They will do this in whatever way is required, usually starting with research and ending with emails, phone calls, and LinkedIn connection requests. They’re often quite literally measured by – and in some cases, even comped on – the number of meetings with prospects that they can get on the calendar.
Entry-level SDRs are relatively cheap and inexperienced – it’s a great first job out of college – but are willing to “pound the phones” in the parlance of our times. The number of leads scales with the number of SDRs, and sales leaders build this into financial plans with, for example, sellers driving X% of total sales, inbound interest driving Y%, and the SDR team driving the rest.
The core work of the SDR team is prospecting. Prospecting is the process of contacting people who might be interested in buying your product and trying to get a meeting with them. These people can vary from those who have expressed some sort of interest (visited the site, perhaps) to those who have expressed none at all (cold outreach to someone who fits your ICP). Nowadays, the most popular channels for outreach are email or LinkedIn, but cold calls are (unfortunately) making a resurgence.
SDR-based prospecting is a volume game. Minimal software is used (for example, Excel for organizing leads, or crude email sequencing). The core work is all manual: SDRs scour LinkedIn for profiles to target, pore through search results to find information they can use to personalize their messages, and laboriously type emails to send. And because of this, the prevailing wisdom is that you scale leads by scaling the number of SDRs you have. Scaling conversion (i.e. more meetings) means more personalization, which means less efficient SDRs. It's a simple question of numbers.
Prospecting is actually an engineering problem
We’ve finally started to turn the corner: there’s enough good software out there to automate major parts of what SDR teams would traditionally do. In my work at Amplify, I’m starting to see forward-thinking sales teams hold off on hiring SDRs and instead use (often haphazardly) patched-together software pipelines to manage their prospecting. They are treating prospecting like an engineering problem.
This has major implications for what the SDR position will look like in the next few years. My bet is that the SDR will move away from a low skill, high input job and instead become more of an ops-focused builder and maintainer of a humming pipeline.
Software for automating prospecting
There are 4 types of tools that come together to form these pipelines. It’s not that SDRs are completely unfamiliar with software, but that adoption has been slow and piecemeal, allowing the basic SDR workflow to remain largely unchanged. Some of these tools have been around for a while, too.
- Reverse IP lookup and enrichment providers like Koala and RB2B allow companies to instantly see who visited their sites and automatically enrich their profiles (no LinkedIn copy-pasting required). These have gotten significantly better in the past few years.
- Sales-focused email automation tools like Apollo allow companies to automatically manage and fine-tune email campaigns.
- Text generation tools like ChatGPT allow companies to generate unique content based on automatically inputted context – offering at-scale personalization way beyond “Hello {NAME}!”
- Glue tools like Clay and Zapier allow non-developers to integrate these tools and turn an array of processes into a software pipeline.
For all of the peacock thought-posting you see on LinkedIn about how AI is changing sales, you’ll note that only one of these tooling categories relies on AI. That’s one reason why I’m so confident in where prospecting is going: this is not just hype, it’s a gradual change that’s been a long time coming.
What an automated prospecting pipeline looks like
Let's break out the two types of lead sources, inbound and outbound, and get a little more granular: What does the traditional approach involve, and what will the new one involve?
First, an inbound example. Someone is browsing your website. What do you do?
With traditional prospecting, you wait and hope. Ideally, that visitor submits a “Contact Us” form because actual website traffic is totally dark. If you’re lucky enough to have any information, you can manually research a visitor with a Google or LinkedIn search and hopefully find an email address you can use.
With modern prospecting, you instantly know who visits your website via a tool like RB2B or Koala (RB2B can even ping a Slack channel as visitors hit the site). From there, visitor information is piped to a data tool like Clay, which can enrich the profile and fill out an email template that Apollo can send. It’s all automated, with as much room as you want for manual intervention.
Next, an outbound example. Your team wants to drive more leads, starting from scratch. What do you do?
With traditional prospecting, you start poring through LinkedIn and putting together complex searches to find people who appear to fit. You copy and paste those contacts into a spreadsheet (because of course, LinkedIn won’t let you export), pick one from the top, start researching them, send a manually personalized email, and then scroll to the next row and start again.
With modern prospecting, you search LinkedIn Sales Navigator with complex boolean logic and scrape all the profiles you find into Clay. You use your favorite email finder tool and pull email addresses into your Clay sheet. Then, you pipe those profiles into ChatGPT, which generates a personalized line or two to add to your templates before Apollo sends them out.
The SDRs of the future will build and tune pipelines
With the direction prospecting is going, I believe the SDRs of the future will be conductors of these pipelines, expanding, adjusting, and tuning them to be faster and more efficient over time. This has implications for who you hire today once you have a first seller in place.
A familiar example to developers here is cloud admins. Before the cloud, IT administrators set up and managed physical racks of servers. When the cloud arrived, IT admins didn’t just swap one workflow for another. They went up a level of abstraction and shifted from managing servers to managing platforms that automatically managed server resources.
Sales prospecting is making a similar shift. Just as IT admins went from managing “pets” to managing “cattle,” so will SDRs shift from brute forcing manual work to building and fine-tuning automatic sales pipelines. SDRs will go up a level in abstraction, with the role becoming more technical and the work resembling conducting or orchestrating.
For founders today, the question becomes: Who do you hire to build and manage these pipelines? I’m starting to steer the companies I work with towards a combination of a few things:
- Some technical skill: you don’t need someone who can code, but you do need someone who’s reasonably comfortable with Zapier and webhooks.
- Process and product mindset: you need someone who takes joy in building new processes and fine-tuning them over time, plus is excited about finding and getting to the bottom of new products.
- Copywriting: great writing is always a standout skill, and with all of this automation, the SDR of the future will be able to spend more time writing better, more compelling templates.
Essentially, you are building a cross functional team that would include both your first seller and an ops/systems generalist. As this matures as a discipline, founders should expect their first sellers and more specifically their sales leader to become an expert at managing and automating these kinds of prospecting pipelines. And like with other things related to AI and automation, reducing manual work in one area means more time and energy for the work that really does require a human touch.
For years, the SDR role was a great entry point for people looking to get into a lucrative sales career.
To the extent this remains true now, it won’t be true for long. We’re on the precipice of inverting decades-long beliefs about selling and about what companies should look for when hiring salespeople. Prospecting is becoming an engineering problem, and founders who take advantage of this shift will grow faster, more efficiently.