We recently engaged a +$100M B2B SaaS company that couldn’t even measure how many leads and opportunities they had.

It’s incredible they got this far with this level of GTM Operations. Let’s just say they have beyond amazing Product Market Fit and brand recognition. But how much revenue is being lost that could have otherwise been captured?

Their PE firm called us and asked for help, desperate to get any visibility into the business they could get, as fast as humanly possible. They couldn’t afford to wait 3-6 months for us to learn the business and build a bunch of documentation, integrations and reports. They wanted metrics yesterday.

However, they also wanted to build the foundation for a more scalable business. We had to strike a fine balance between urgent needs and long-term process improvement. In this article, we’ll share how we approached the problem.

Why are the Metrics Inaccurate?

Let’s start with the problem. Why were their metrics inaccurate? Why are they inaccurate in most companies?

It’s a simple answer. GTM metrics are always inaccurate because the GTM processes are poorly defined and/or not being executed properly by the people and systems. It’s really that basic. Fixing it, unfortunately, can take a lot of time and effort.

So where do we start?

What Can we Measure Accurately Today?

Let’s start with a simpler question. What can we measure accurately today?

The PE firm wanted to know how many leads and opportunities they had asap. They made this simple. We defined leads as demo requests and opportunities as demos delivered. This data was already sitting somewhere. All we had to do was find it and map it to Salesforce. Simple. Quick. Easy.

We got to work as fast as possible and built this out, providing visibility quickly, as imperfect as it was.

Most GTM teams have a lot of data today that’s already accurate.

• Demo requests
• Demos delivered
• Other website form fills
• Other meetings scheduled
• Sales emails sent and received
• Closed Won Opportunities
• Renewals Won and Lost
• Average Sales Price

Between the website data, email, calendar, and accounting data, we can already see a lot of things at the very top of the funnel and the bottom of the funnel accurately. It might not be perfect data, but it’s a start.

What Can We Measure More Accurately Tomorrow?

Many other metrics aren’t that easy. For example…..

• How many SQOs (Sales Qualified Opportunities) have we generated?

Calling all demos delivered an SQO is not a long-term solution. The reps created 75 Opportunity records in Salesforce last quarter, but how many of them were really qualified? To answer that question, we have to answer a number of other questions first.

• What is the qualification criteria for an SQO?
• How do we make sure all our pipeline meets this criteria?

And, to answer those questions, we have to first answer even more…

• How do we define our ICP and Buyer Personas?
• What Sales Methodology do we use?
• How does the methodology translate into a Sales Process?
• How do we implement the Sales Process into the CRM?
• How do we report on our pipeline generation and management?
• What process does management have to review the pipeline?

Why do we have to answer all these questions? Because, by definition, these things tell us whether or not we have a reasonable chance of closing the deals in our pipeline, if we’re spending good money paying reps to chase these deals, and if we can trust our pipeline to forecast.

Each of these things is reverse engineered from the deals we have actually won. If we don’t have this we don’t have any real visibility. We just have a bunch of opportunities sitting in the CRM that no one really trusts and no way to see what’s working, what’s not, and how we can improve our Close Rates and forecast accuracy.

Getting This Right Takes Time

This can take a LOT of time. Continuing with our SQO example, we need to do all the following.

• Document definitions and process
• Implement the process into Salesforce
• Build the reporting and dashboard engine
• Train the team, from sales reps to managers
• Implement a recurring Pipeline Review Process
• Remind reps again and again how to qualify deals
• Possibly iterate our definitions and process over time

This can take months, quarters or even years to get right, especially with longer sales cycles. It’s never perfect and every new rep, new manager, new product, and new market has to go through this process.

To be clear, you can make a LOT of headway very fast if you have a small team and are dedicated to working quickly, but it takes time to really nail this down and it will never be perfect. And, this example is just one metric.

What about…..

• MQLs (Marketing Qualified Leads)
• SALs (Sales Accepted Leads)
• SQLs (Sales Qualified Leads)
• Stage Entry Criteria (Stage 2, 3, 4, etc.)
• Close Rate
• Sales Cycle
• Average Sales Price
• Gross Retention Rate
• Expansion Sales Metrics
• Net Revenue Retention
• Finance Metrics (CAC, LTV:CAC, etc)

Every CEO and CRO I have ever met wants all these metrics yesterday. Billions of dollars have been invested to create better tools to calculate and visualize this data. But it takes a LOT of time to get the process right first. Read more about this in our GTM Metrics and Insights Framework.

Where should we start to make this long-term investment into improving our GTM Operations and, by extension, our GTM Efficiency?

Start with New Business Closing

When I explain this to CROs, CEOs, and VC/PE investors, they all get it. But it’s not what they want to hear. They don’t want to wait 3, 6, 12 months to build the perfect GTM Engine before they see an impact on revenue.

Most want to improve pipeline generation first, but I always push back on this. In order to accurately measure pipeline generation, we need to have the SQO qualification criteria defined and the other things outlined above in place to be able to trust our metrics.

Additionally, what’s the point of generating more pipeline if we just lose the deal due to a poor closing process? We should stop the bleeding first, focus on closing more of the pipeline we’re already generating, and then we can shift focus to generating more pipeline once the closing process is at least good enough.

We start here by focusing on four basic metrics:

• Pipeline Generation (SQOs Created)
• Close Rate
• Sales Cycle
• Average Sales Price

To do this, we need to define an SQO as quickly and easily as possible and then implement the process into Salesforce, our reporting system, and our daily sales motion. This can happen in a matter of weeks. From there, we can start to work on longer-term foundation building.

We might look at something like ICP and Buyer Personas and say “It’s good enough for now. Let’s tackle this next month after we get the very basics in place.” Once we get these basics in place for pipeline management, we then want to look at the basic metrics for Inbound/Outbound/Allbound.

New Business Pipeline Generation

Whether we’re talking about inbound, outbound, allbound, etc we have to start with the end in mind, SQOs and Closed Won Opportunities. With the above processes and metrics in place, we can now accurately measure what’s working and not working to generate real pipeline.

To drill in further, we need to define the starting points and inflection points along the journey.

Inbound

• What’s our ICP/Personas?
• How do we define an MQL?
• When and how do we route leads?
• What is the target lead response time?
• What is the process to follow up with leads?
• When do we walk away and close out new leads?
• How do we track and manage reps on this activity?
• What do we measure along the way? SALs? SQLs? Etc?
• How do we do attribution to measure different channels?

Outbound

• What’s our ICP/Personas?
• What capacity do reps have?
• How many prospects can they reach?
• How do we define the best prospects?
• What’s our outbound prospecting process?
• When do reps walk away due to lack of response?
• How do we pass prospects to marketing to nurture?
• How do we track and manage reps on outbound activity?
• What do we measure along the way? Activity? Meetings? Etc?

This is obviously a lot of work, but if we want to see if/when/why one channel, type of lead, rep, etc is working or not working we need to have a well defined process that’s being executed and producing data we can analyze.

It’s such a cliche that marketing creates a lead and sales is blamed for not converting it. Can we see if, when, and how the rep followed up with that lead? If we can, we can have an objective view. If not, we can’t.

Check out our Pipeline Management Framework for a deeper dive on this.

What About Net Revenue Retention?

What is the point of generating more new business tomorrow just to churn them the next day? This is a great question. We focus on new business first because this is usually what the CRO, CEO and investors want to focus on first. That doesn’t make it right, but, once we nail down the qualification and closing process for new business, it’s easier to do the same thing for renewal and expansion deals.

Once we can see how we track cold outbound prospecting, we can translate it into how we prospect into our existing customers for expansion opportunities as well.

However, I would challenge leaders to ask a simple question: What is the biggest opportunity to grow revenue quickest?

If we’re sitting at 80% Net Revenue Retention, can we get to 100%? And what would that mean in revenue? At $100M this could be a delta of $20M. Is this more or less than the revenue we can expect to generate by improving the new business sales process?

That is a much harder question to answer. The good news is that you can get the bare bones basics for both relatively quickly and then spend the following quarters and years perfecting it.

So, where did we end with this B2B SaaS Company?

We’re not even close to done yet. This is a never ending journey. They’ve had tremendous success despite these inefficiencies and we’re working with them to fix each item one at a time.

We started with basic metrics, not even to stop the bleeding but simply to be able to see it, looking at new business lead generation, pipeline generation, and close rates as quickly and simply as possible. From there, as we described, we worked to fine tune it to get better visibility for the long-term.

In tandem with this, the business recently brought on a new CRO and they’re working to build out their pipeline generation more. We’re working alongside them to help put processes and metrics to those new/improved motions to provide the CRO visibility into what’s working and what’s not.

Fortunately for them they have a great product with a lot of stickiness, so there wasn’t deep pain on the NRR side but this will be still an area we dive into soon.

If you’re a revenue leader at a $50M+ ARR B2B SaaS company and curious how we can do this for you, let’s talk.