Sales KPI Dictionary
Plain-English definitions and formulas for every metric your sales dashboard throws at you, so MRR, sales velocity, and win rate stop being jargon and start being numbers you can act on.
What's inside
- Pipeline metrics — Pipeline Value, Pipeline Coverage, Pipeline Velocity, Weighted Pipeline
- Conversion metrics — Win Rate, Lead-to-Opportunity Rate, Stage Conversion Rate, Close Rate by Source
- Revenue metrics — MRR, ARR, ACV, New/Expansion/Contraction/Churned/Net New MRR
- Efficiency metrics — Sales Cycle Length, CAC, CAC Payback Period, Magic Number
- Retention metrics — Gross Revenue Retention, Net Revenue Retention, Logo Churn Rate, LTV
- Activity metrics — Quota Attainment, Activity-to-Meeting Ratio, Meeting-to-Opportunity Ratio
- Forecast metrics — Forecast Accuracy, Commit vs. Actual
- Quick-reference formula index table for the six metrics you'll look up most
One page, plain English, every formula spelled out. Bookmark it, print it, keep it open next to your dashboard.
Pipeline Metrics
Pipeline Value — The total dollar amount of all open opportunities. Formula: sum of Amount across all open deals. Not a prediction of revenue — just a measure of what's in motion.
Pipeline Coverage — How much open pipeline you have relative to your quota/target. Formula: Open Pipeline Value ÷ Revenue Target. Benchmark: most B2B teams target 3–4x coverage, because not everything in pipeline closes.
Pipeline Velocity — How fast dollars move through your funnel. Formula: (# Opportunities × Win Rate × Average Deal Size) ÷ Sales Cycle Length (days). Higher is better — it's your engine speed, not just your engine size.
Weighted Pipeline — Pipeline value adjusted for probability of closing. Formula: sum of (Deal Amount × Stage Probability %) across open deals. More realistic than raw pipeline value for forecasting.
Conversion Metrics
Win Rate — Percentage of opportunities that close won. Formula: Closed-Won ÷ (Closed-Won + Closed-Lost). Always exclude still-open deals from the denominator — including them understates win rate.
Lead-to-Opportunity Rate — Percentage of leads that become sales-qualified opportunities. Formula: # Opportunities Created ÷ # Leads.
Stage Conversion Rate — Percentage of deals that advance from one stage to the next. Formula: # entering Stage N+1 ÷ # entering Stage N. Use this to find the exact stage where deals die (see the Sales Funnel Conversion Rate Calculator).
Close Rate by Source — Win rate segmented by lead source or channel. Tells you which channels produce leads that actually close, not just leads that look good in volume.
Revenue Metrics
MRR (Monthly Recurring Revenue) — Predictable revenue normalized to a monthly figure.
ARR (Annual Recurring Revenue) — MRR × 12.
ACV (Annual Contract Value) — Total Contract Value ÷ Contract Length (years). Used to compare deal size across contracts of different lengths.
New MRR — Recurring revenue added from new customers this period.
Expansion MRR — Additional recurring revenue from existing customers (upsell, cross-sell, seat growth).
Contraction MRR — Recurring revenue lost from existing customers downgrading (not churning entirely).
Churned MRR — Recurring revenue lost from customers who cancelled entirely.
Net New MRR — Formula: New MRR + Expansion MRR − Contraction MRR − Churned MRR. The real growth number.
Efficiency & Velocity Metrics
Sales Cycle Length — Average number of days from opportunity creation to closed-won.
CAC (Customer Acquisition Cost) — Fully-loaded cost to acquire one customer (see the CAC & LTV Calculator).
CAC Payback Period — Months required for a customer's gross margin to repay their CAC. Formula: CAC ÷ (Monthly Revenue per Customer × Gross Margin %). Benchmark: under 12 months is healthy for most B2B SaaS.
Magic Number — Efficiency of sales & marketing spend at generating new ARR. Formula: (Current Quarter New ARR − Prior Quarter New ARR) × 4 ÷ Prior Quarter S&M Spend. Above 0.75 is generally considered efficient growth.
Retention Metrics
Gross Revenue Retention (GRR) — Formula: (Starting MRR − Contraction MRR − Churned MRR) ÷ Starting MRR. Caps at 100% — expansion doesn't count.
Net Revenue Retention (NRR) — Formula: (Starting MRR + Expansion MRR − Contraction MRR − Churned MRR) ÷ Starting MRR. Can exceed 100% — a mark of a healthy expansion motion.
Logo Churn Rate — Formula: # Customers Lost ÷ # Customers at Start of Period. Different from revenue churn — losing 10 small accounts and 1 large account can produce very different logo vs. revenue churn numbers.
LTV (Lifetime Value) — See the CAC & LTV Calculator for the full formula and worked example.
Activity & Rep Performance Metrics
Quota Attainment — Formula: Actual Closed-Won Revenue ÷ Quota Target.
Activity-to-Meeting Ratio — Formula: Total Activities ÷ Meetings Booked. Falling ratios over time usually mean messaging or targeting has drifted.
Meeting-to-Opportunity Ratio — Formula: Opportunities Created ÷ Meetings Held.
Forecast Metrics
Forecast Accuracy — How close forecasted numbers were to actual closed results (see the Sales Forecast Accuracy Scorecard for full per-rep methodology).
Commit vs. Actual — Formula: (Actual Closed-Won − Total Committed) ÷ Total Committed. Consistently large positive numbers usually mean sandbagging, not outperformance.
Quick-Reference Formula Index
| Metric | Formula |
|---|---|
| Win Rate | Won ÷ (Won + Lost) |
| Pipeline Coverage | Open Pipeline ÷ Target |
| Sales Velocity | (Opps × Win Rate × Avg Deal Size) ÷ Cycle Length |
| NRR | (Start MRR + Expansion − Contraction − Churn) ÷ Start MRR |
| CAC Payback | CAC ÷ (Monthly Revenue × Gross Margin %) |
| Quota Attainment | Actual Revenue ÷ Quota |
How to use it
Keep it open next to your dashboard the first few times you review it, and look up any metric by name the moment you're not 100% sure what's actually in the denominator.