ABCDEFGHIJKLMNOPQRSTUVWXYZ
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Qualified Opportunities(x) ACV(=) Pipeline Value(x) Close Rate(=) Revenue
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25150,0003,750,00020%750,000
Let's say for every 5 opportunities you stop working, your win rate jumps 5%.
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20150,0003,000,00025%750,000
You'd make that trade once, to go from $600K to $625K generated.
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15150,0002,250,00030%675,000
Would you make that trade a third time? Down to 20 opportunities?
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10150,0001,500,00035%525,000
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Qualified Opportunities(x) ACV(=) Pipeline Value(x) Close Rate(=) Revenue
To answer that, let's add in the fact that ACV tends to increase. Someone who's already bought in on pain and solving it.
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25150,0003,750,00020%750,000
The more time you invest in creatively expanding reach, use case, etc... the more ACV tends to grow.
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20165,0003,300,00025%825,000
So let's look at this again, with a $15K increase in ACV.
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15180,0002,700,00030%810,000
Now, you would make that trade, down to 20 qualified opportunities.
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10195,0001,950,00035%682,500
In fact, you'd even prefer 15 to 25 opportunities.
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Qualified Opportunities(x) ACV(=) Pipeline Value(x) Close Rate(=) Revenue
Of course, moves aren't that incremental. JOLT effect shows difference is typically 20 - 50%.
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25150,0003,750,00020%750,000
Now, let's take a middle of the road scenario and ask, which metric do we focus on here?
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10250,0002,500,00050%1,250,000
If we grow pipeline by 30%, adding 3 more qualified deals, what happens to revenue?
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Difference (=) 500,000
Revenue grows by $270K.
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Qualified Opportunities(x) ACV(=) Pipeline Value(x) Close Rate(=) Revenue
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20$150,000$3,000,00025%$750,000
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vs.
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12$250,000$3,000,00045%$1,350,000
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Difference (=) $600,000
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Qualified Opportunities(x) ACV(=) Pipeline Value(x) Close Rate(=) Revenue
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10300,0003,000,00020%600,000
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10300,0003,000,00050%1,500,000
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Difference (=) 900,000
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