PE: Vital Few KPIs for CROs Driving Growth at PE-Backed Companies

As the simplest level, here are the fundamental KPIs every Chief Revenue Officer should focus on in Growth PE.

 

New Logo Sales  / New Customer Acquisition

Note: these should be measured per segment / per team / per territory, etc.

  • # of New Business (aka New Logo) Opportunities in the Sales Pipeline (and inflow over 4-8 quarters, by month)
  • % Win Rate (only after your Sales Process is well-engineered, defined and optimized)
  • $ACV / $TCV (and ACL – average contract length)
  • $MRR / $ARR over time
  • Win Cycle (aka Sales Cycle Duration – can be per segment/vertical/team/geo/prod)
  • $ New Business Bookings (sales bookings for New Business, aka: New Logo Sales)
    • don’t confuse $ARR with $Bookings – $ARR can increase even if $Bookings don’t
  • Pipeline Inflow (Opportunities Created)
    • by # Count and $ Amount
  • Sales Efficiency & Unit Economics (by segments and for New Business separately from Expansion Sales below)
    • LTV:CAC
    • CAC Ratio
    • CAC Payback

 

Expansion Sales

  • $ Expansion Bookings (sales bookings for Cross-Sells from M&A add-ons & tuck-ins, and Upsells)
    • Cross-Sell is typically products from add-on acquisitions
  • Expansion Unit Economics
    • LTV:CAC
    • CAC Ratio
    • CAC Payback

 

Customer Retention

  • % GRR – Gross Revenue Retention
  • % NRR – Cohort Analyses & NRR (good = 115%+)
    • i.e. not Churn
  • Renewal rates
  • Account Retention

 

Overall Revenue and Customer Growth & Health

  • Net $MRR and Growth Trend
    • i.e. Net $MRR = Existing $MRR + ($ New Business + $ Expansion + $ Reactivation) – ($ Down-sell Contraction + $ Churned)
  • Net $ARR and Growth Trend
  • Customers – # and % Growth
  • Customer NPS
  • $ARPA