In their early years, companies often try to create large sales infrastructures as quickly as possible. They look at a market like Texas and say, well, there are 1,000 companies here that we can target, so we need ten sales teams on the ground right away, and each one can deal with 100 companies. But all they’re doing is guessing. They don’t really know what the market will bear. And if they’re wrong, they’ve wasted a lot of money on those sales teams.
A version of this article appeared in the October 2004 issue of Harvard Business Review.
