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What you'll take away
- Lagging and leading indicators answer different questions. Cash position, profitability, and runway all come from the past and they matter. Neither of them tells you what your revenue looks like in 90 days.
- Pipeline coverage is one division. Total pipeline value over your quarterly revenue target. Three to four times is where you want to be.
- Sales velocity gives you a revenue per day number you can trend. The absolute figure is less interesting than the direction it moves week over week.
- Clean the data before you report anything. Every number here comes from a CRM, and CRMs are maintained with noticeably less discipline than a bank reconciliation.
- Get the head of sales to sign off before you present their pipeline. Not optional, and not really about accuracy.
Pipeline coverage, and the cleanup that comes first
Total pipeline value divided by your quarterly revenue target. Three million in pipeline against a one million target is three times coverage, which means you hit your number if you close one deal in three.
Rough bands: above four is strong, three to four is healthy, and below two is a problem. Adjust for your industry, because a business with a two year sales cycle is playing a different game than one closing in three weeks.
You probably already know the target, since finance usually sets it. The pipeline value is the part you'll have to go and ask for, which is where the work is. Expect to find deals that have been sitting open for years, deals with no value attached, and deals with no close date. Clean those out first, and get the sales manager to agree the number before it appears in any report. Present a figure they haven't seen and the conversation stops being about the business.
The upside is that most heads of sales have been trying to get their team to update the CRM for months, so you're on the same side of this one.
Sales velocity
Opportunities, multiplied by average deal size, multiplied by win rate, divided by sales cycle length in days. That gives you revenue per day.
In the session's example, 100 qualified opportunities with a 90 day cycle worked out to around five million a year, roughly 416,000 a month, about 13,000 a day. The annual figure is the least useful of the three. What you want is the daily number plotted week over week, because a velocity that's climbing means capacity, hiring, and delivery conversations need to start now rather than when the orders land.
Every input comes from the CRM, which brings you back to data hygiene. Of the four levers, he'd scrutinize opportunities hardest, since reps are often measured on how full their pipeline looks and it fills accordingly. Deal size is the next one to check, particularly if you're reading gross where you should be reading net of cost of sales. Cycle length is only as good as your CRM's automation, and win rate is fairly hard to fudge.
The warning signs
- Coverage below three for two weeks running. One week is noise. Two starts to look structural.
- Strong coverage, but deals keep slipping. That combination points at padding rather than pipeline, and it's worth naming.
- A pile of early stage deals and a long cycle. Fifteen new deals this week on a three month cycle means three months of very little arriving. The pipeline looks healthy and the revenue doesn't show up.
- Velocity trending down. It compounds. A falling revenue per day drags coverage down with it a few weeks later, which is why the two metrics belong on the same sheet.
What to do when they drop
Push the late stage deals that need a nudge, with a small discount if leadership will authorize one. Reactivate dormant opportunities, since a prospect who said no a year ago may be unhappy with whoever they chose instead. Run outbound. Get the close dates reviewed honestly.
And tell leadership early. His point on this was blunt: sales teams sell internally as well as externally, so someone will be reporting a great month based on a pipeline that velocity doesn't support. Finance is well placed to ask how those two things fit together. Not to make anyone look bad, just to get a realistic number in front of the people making decisions.
What not to do: panic and cut prices, because margins are under enough pressure already. Sit on bad numbers because they're uncomfortable. Or open with blaming the market.
Questions from the room
How often should I take this to leadership? Start by earning the right to. Most leaders are used to finance bringing them the past, so run one session explaining what these numbers are, how you calculated them, and what you plan to do with them. Then agree a cadence with them rather than picking one. He was firm on the underlying issue: plenty of accountants have the relevant information and not the confidence to present it, and the information is what should give you the confidence.
Do I measure cycle length from first contact, from qualification, or from proposal? His answer is first contact, because you want to know how long it takes to sell rather than how long it takes to close once a proposal is out. Measure from proposal and you can't see a slow follow-up or a demo that took two weeks to schedule.
What actually lengthens cycle times? Could be fit, pricing, a demo that didn't land, not enough information to decide, or talking to someone who was never the decision maker. His advice was to keep asking why rather than accepting the first answer, and to look outside the business as well. Sometimes the cycle is longer because a competitor is in the room, not because anyone internally did something wrong.
Can I automate this? If your CRM has an open API, which HubSpot, Pipedrive, and Zoho all do, you can have something pull the numbers and update a dashboard weekly. He suggested Claude Code for it, with one caveat worth repeating: check your company's position on AI tools before you connect anything to the CRM. If the answer is no, this is a spreadsheet and ten minutes a week.
The one thing to do this week
Ask for read access to the CRM, and spend an hour auditing what's in the pipeline before you calculate anything at all. The metric takes a minute. The audit is what makes the metric worth presenting.
Watch the session
The full recording is above. This one was run with TaxStar, and if you want to compare notes on what's working in your own reporting, get in touch.
