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Value or CalculationField Instructions
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Welcome to InfiniGrow's Revenue Model! Use this model to calculate marketing's revenue targets, monthly budget and proxy metrics!

We recommend you use the accompanied article to learn how to implement this model: https://infinigrow.com/blog/revenue-model/

For more information about automating this process: https://infinigrow.com

InfiniGrow's version attempts to simplify the model, and derive the monthly targets and budgets (see the "Marketing monthly targets calculation" sheet).
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Calculation #1: Revenue target
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End-of-year planned ARR
$3,000,000The company's total annual revenue by the end of the year
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Start-of-year ARR$1,000,000The revenue generated by existing customers at the beginning of the year
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Planned Net Retention Rate in the year100.00%How much of the existing revenue you expect to retain (accounting for net churn and expansion)
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Current pipeline$250,000Amount of existing pipeline that will be carried to the next year
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Pipeline close rate20%Historical or planned close rate from pipeline to closed/won
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New ARR Goal$1,950,000The new ARR goal for this year, accounting for net churn and existing pipeline
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Sales/marketing responsibility
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Inbound % of revenue65%The % of revenue that Marketing is responsible for sourcing (Inbound)
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Outbound % of revenue35%The % of revenue that Sales is responsible for sourcing (Outbound)
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Calculation #2: Customers & funnel targets
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Average selling price$20,000The average historical or expected won deal size
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Total # new logos (closed/won) needed98Total number of new logos needed to meet ARR goals.
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Opportunity to close conversion %20%The rate at which opportunities are closed/won.
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Total opportunities needed488Total number of opportunities needed to meet ARR goals.
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SQL to Opp conversion %60%The rate at which SQLs convert to opportunities.
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Total SQL needed813Total number of SQLs needed to meet ARR goals.
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MQL to SQL conversion %50%The rate at which MQLs convert to SQLs.
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Total MQL needed1625Total number of MQLs needed to meet ARR goals.
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Lead to MQL conversion %50%The rate at which leads convert to MQLs.
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Total Leads needed3250Total number of leads needed to meet ARR goals.
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Calculation #3: Marketing targets (proxy metrics)
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Proxy metricSQLsChoose the metric that is used for day-to-day marketing optimization.
The below fields should be filled accordingly
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Marketing SQLs to Closed/Won %12.00%The conversion rate between your proxy metric to Closed/won
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% of pipeline that will close during the year75%This field is used to account for sales cycle lag (for example, if the sales cycle's velocity is 1 month, you will only close 91% of the pipeline during the year)
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# of Marketing SQLs needed
(including sales cycle lag compensation)		705Marketing's proxy target (taking into account the sales cycle lag) which will be used for ongoing optimization towards the revenue goal
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Calculation #4: Costs & budget
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Total marketing budget, last year$200,000The total budget spent on marketing throughout the previous year
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# of SQLs from marketing, last year500Used to calculate historical cost per SQL
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Cost per SQL$400Historical cost per SQL
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Total Needed Budget$282,000The total budget needed to reach Marketing's ARR goal
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Additional calculations
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Marketing New ARR Goal$1,267,500The total new ARR that marketing needs to drive throughout the year
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Marketing New ARR ROI4.5xThe expected ROI of the marketing budget. The calculation divides New ARR goal by the total budget.
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Cost per Marketing SQL$534Total budget divided by marketing SQLs
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Cost per Marketing Customer$6,675Total budget divided by marketing customers
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* The model is based on Metadata's demand model (find the original model here: https://metadata.io/resources/blog/building-demand-model/).
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