Definition
Pipeline velocity estimates how quickly pipeline converts into revenue. It combines deal size, win rate, and sales cycle length.
Formula
Pipeline velocity (per period) ~= opportunities * win rate * average deal size / sales cycle length
How to use it
- Use it to diagnose whether growth comes from more pipeline, higher win rate, larger deals, or faster cycles.
- Track velocity by segment (SMB vs enterprise) because deal size and cycle length differ.
Common mistakes
- Mixing stage definitions (win rate) and pipeline numbers from different funnels.
- Optimizing velocity by inflating pipeline with unqualified opportunities.
Why this matters
This term matters because small changes compound in SaaS metrics. Use consistent definitions by cohort and segment so you can diagnose retention, payback, and growth quality.
Practical checklist
- Write a 1-line definition for "Pipeline Velocity" that your team will use consistently.
- Keep the time window consistent (weekly/monthly/quarterly) when comparing trends.
- Segment results (channel/plan/cohort) before drawing big conclusions from blended averages.
- Sanity-check with a related calculator from the same category on MetricKit.
- Read the related guide (e.g., Pipeline coverage and sales cycle math: set realistic targets (and avoid sandbagging)) for context and common pitfalls.
Where to use this on MetricKit
Calculators
- Bookings vs ARR Calculator: Compare bookings vs ARR (and cash) for a contract with term length and one-time fees.
- SaaS Magic Number Calculator: SaaS Magic Number definition and calculation using net new ARR and prior-period sales & marketing spend.
- Customer Lifetime Calculator: Estimate customer lifetime (months) from monthly churn rate (a simple approximation).
- MRR Forecast Calculator: Forecast MRR over time using new MRR plus expansion, contraction, and churn rates.
- Blended CAC Calculator: Compare paid-only CAC vs fully-loaded (blended) CAC, and estimate payback at a target margin.
Guides
- Pipeline coverage and sales cycle math: set realistic targets (and avoid sandbagging): A practical guide to pipeline coverage: connect quota, win rate, sales cycle length, and CAC/payback constraints to set realistic growth targets.
- Sales ops metrics hub: quota, pipeline, win rate, and capacity planning: A practical hub for sales ops planning: quota attainment, pipeline coverage, required pipeline, sales capacity with ramp, and OTE math.