Plenty of GTM math is getting more and more complicated, but one metric has always served me well by keeping it dead simple. Shoot for 3X pipeline coverage, 4X if you want to err on the conservative side. That's it. Anything under that means you're likely leaving too much good pipeline on the shelf. Anything over that implies either a qualification problem or a conversion problem. And that is NOT a sales problem, because you all own that together as part of a unified go-to-market team. The problem(s) could be any of a number of things - lead quality, imprecise buying journey mapping, sales process management, buying committee multi-threading, etc. I imagine even this simple math will stir up some debate for you internally. Better to have that conversation now in pre-fiscal year planning than mid-year when it's harder to course-correct.
I think it’s much more nuanced than that and part of the problem we’ve created is directly related to the arbitrary pipeline coverage metrics. If you have a tightly defined ICP, a very curated target account list that leverages relevant signals, and the right messaging and sales enablement, arguably you should need fewer forecastable opportunities because your velocity and win rates should be higher. My point being, don’t assume that simply bec you have 3x pipeline coverage, you’re in a good place to hit your revenue goals.
Jon Miller
3w
I’m currently working with a company that does not book deals. When they sign a contract, all revenue is based on actual usage going forward, and unfortunately it is extremely difficult to forecast what that will look like for the next 12 months. This makes sales compensation challenging, but it also makes it almost impossible to understand pipeline coverage ratios. Do you have any advice for situation like this?
3X pipeline coverage is cool... until your close rates are stuck in single digits and everyone’s pointing fingers. If we're just piling leads into the top of the funnel without looking at win-loss rates, we’re just creating a very expensive blame game between product, marketing, and sales. Let’s fix the ICP and product-market fit first—otherwise, you're just inflating pipeline and disguising deeper cracks in the foundation. #pipelinemanagement #ProductMarketFit #ICPAlignment #WinRate #GTMstrategy
Kenny L.
3w
I've been a fan of tracking pipeline coverage ratios (PCR) for over a decade and it''s my #1 metric to start building trust with sales. BUT it must be used pragmatically.. ie Dave Kellogg famously says "PCR is not the inverse of win rate, and he's right (he has walked me off my draconian views, but I'm still clingy on some aspects 🤣 ) What PCR can do.. 1. PCR helps give you a sense if sales has a fighting chance of closing said qtr as well as the relative health of future qtr health +1, +2, +3 qtrs out (depending on how long your sales cycles are) 2. Based on above, PCR can guide mktg on short vs long term campaign priorities (ie new vs expansion, etc) , depending on PCR strength/weakness 3. PCR can show you where pipe "ebbs and floods" and WHY. 4. PCR helps drive better convos with GTM teams ie - spend more to get 7x pipe, or spend on enablement, etc. 5. PCR can shed light on trends ( ie feedback loops to upstream teams to improve mktg messaging, etc (ie - 40% of deals push or get closed lost due to X reason, so improve messaging to make X points stronger, up front) . All this creates better convos bwn GTM teams. Big caveat - this requires sales to be accountable to strong data mgmt, discipline and accuracy.
Will King
3w
In my experiences, for enterprise level sales, a lot is dependent on your sales process metrics and the criteria for advancing opportunities. As an example, coverage in the 2.5 to 3X range can be acceptable for those opportunities that are beyond the sales qualification stage in your sales process. However, the coverage for the total pipeline should to be more to the 5X range.
And yet, those same pipelines have "opportunities" after a first meeting. Too many lie to themselves about their pipeline.
3X pipeline coverage is a sweet spot because it creates a buffer against typical conversion rates while keeping the pipeline lean enough to stay efficient. It’s the balance that avoids overloading sales with poorly qualified leads or, conversely, starving them of opportunities. For teams wanting a stronger buffer, 4X is smart, but clarity around lead quality becomes crucial.
Waqas Ahmed
3w
As you mentioned, if coverage is too low, opportunities are missed—but if it’s too high, it usually points to lead qualification or conversion issues. Identifying these problems early on helps avoid the scramble mid-year. I couldn’t agree more—pre-fiscal planning is the best time to address these discussions and align the strategy.
3-4x is generally good if your product, value prop, ICP, pipe quality, sales discipline and processes are sound. It’s also important to distinguish pipe multiples needed for Net New vs. Expansion, customer sizes, various verticals, etc. Blended coverage is misleading.
Author "Sales Manager Survival Guide," CEO at Partners In EXCELLENCE, Ruthless Pragmatist
3wMatt, I have to confess being confused and possibly disagreeing. I agree on a simple metric like pipeline coverage. But it has to be the right pipeline coverage. In today's world, where win rates are 15-20%, the 3-4x guidance is a recipe for underperformance. And it doesn't focus us on identifying the problems. A good question/challenge might be, "What do we have to change to have confidence in a 3-4X pipeline?" And that may be what you are suggesting. Hmmmm....... As I walk through this, I think I'm getting your point. Perhaps, too often, we do the pipeline math, settling on the 5-6X, but never challenging ourselves, "Why? What do we need to change......"