Pipeline mathematics — Sales process, pipeline & forecasting

This is the section to over-learn. Interviewers for quota-carrying roles routinely test it live ("walk me through the maths on a £600k number"), and fluency here is cheap credibility. First, the vocabulary:

Quota (or target, or "your number"): the revenue you're personally accountable for delivering in a period, usually a year, tracked quarterly. Commission plans pay against it.
Pipeline: the total value of your open opportunities — everything qualified but not yet closed.
Win rate: the fraction of opportunities that end closed-won. Won ÷ (won + lost). Win rates of 20–30% on qualified opportunities are commonly cited; big-ticket enterprise (£100k+) often runs 12–22% — which is why coverage demands rise with deal size.
Average deal size — three measures interviewers use interchangeably and expect you to keep up with:
- ACV — Annual Contract Value: one contract's value per year. A 3-year deal worth £120k in total has a £40k ACV.
- ARR — Annual Recurring Revenue: the company-level total of all recurring (subscription) revenue annualised. ACV describes a deal; ARR describes the business ("we're at £5m ARR").
- TCV — Total Contract Value: everything a contract is worth over its full term, one-off fees included. That 3-year deal: TCV £120k (plus, say, a £15k implementation fee → £135k). SaaS quotas are usually set in ACV/ARR terms; TCV flatters multi-year deals.
Sales cycle length: elapsed time from opportunity creation to close. Six weeks for a small GP-practice product; 6–18 months for an enterprise NHS or pharma platform.
Coverage ratio: open pipeline ÷ remaining quota for the period. The rule of thumb is 3–4x: to close £1, carry £3–4 of qualified pipeline. Why? Because coverage is really just the inverse of win rate — if you win 25–33% of what's in the pipeline, you need 3–4x your target sitting in it. A rep with 25% win rate and 2x coverage is on course to land around half their number (expected value, before in-quarter pipeline creation).

Field note
Coverage ratios are prone to Goodhart's law: the moment 3x stops being a diagnostic and becomes a target, pipelines mysteriously arrive at 3.1x. Reps nudge deal values up, resurrect zombie opportunities and defer marking things closed-lost, and the dashboard glows green while the quarter quietly dies underneath it. Treat coverage as a thermometer, not a thermostat — the ratio only means something if every deal beneath it would survive the exit-criteria test in section 2.

The master sequence — working backwards from quota — is four divisions. Memorise it as a chain:

Quota ÷ ACV = deals needed. Deals needed ÷ win rate = opportunities needed. Opportunities needed × ACV = pipeline needed (equivalently: quota ÷ win rate). Opportunities needed ÷ conversion rate per activity = activity needed.

Worked example 1 — £600k quota, £40k ACV (the classic interview drill)

You're an AE with a £600k annual quota selling a lab-informatics platform (such as a LIMS — Laboratory Information Management System — software that manages lab samples, tests and data; think LabWare or Benchling) at £40k ACV, with a 25% win rate.

Deals: £600,000 ÷ £40,000 = 15 closed-won deals this year.
Opportunities: 15 ÷ 0.25 = 60 qualified opportunities must enter the pipeline.
Pipeline: 60 × £40k = £2.4m of pipeline across the year — which is £600k × 4, i.e. 4x coverage, exactly what a 25% win rate predicts.
Activity: suppose 1 in 3 discovery calls qualifies into an opportunity → 180 discovery calls a year ≈ 15 a month. Suppose 5% of outbound touches produce a discovery call → 3,600 touches a year ≈ 70 a week. (These conversion assumptions vary hugely by market — the point is you state your assumptions and divide.)

Per quarter that's £150k to close, ~15 opportunities to create, and £450–600k of live coverage to maintain. When an interviewer says "walk me through a £600k number", this four-step chain, said aloud with the divisions done in your head, is the whole game.

One nuance: annual pipeline generated (the £2.4m that must flow through the year) is not point-in-time coverage (open pipeline ÷ remaining target right now). "What's your coverage?" means the latter: "I'm carrying £450k against £150k left this quarter — 3x."

Worked example 2 — a published funnel (an NHS-facing startup's 2026 adverts)

Some companies publish their quota mechanics right in the job listing. One NHS-facing startup that automates GP-practice admin published funnel maths like this in its 2026 adverts (its current listings no longer carry the figures — the arithmetic, not the advert, is the point): 10 live practices per week, with a 70% demo-to-sign conversion. Work it backwards:

Signs needed: ~10/week (treating signed ≈ live, with a short onboarding lag).
Demos needed: 10 ÷ 0.70 = 14.3 → ~15 demos a week — roughly 3 per working day.
Top of funnel: if, illustratively, 1 in 3 conversations with a practice manager books a demo (their real number isn't published — flag your assumption), that's ~45 conversations a week, ~9 a day.

Two lessons.

First, a 70% demo-to-sign rate is extraordinary by enterprise standards (20–30% on qualified opportunities is the commonly cited range) — it tells you demos happen after heavy qualification and the product is close to a no-brainer, so the binding constraint is demo volume, not closing skill. This is a velocity motion: small deals, weekly cadence, volume discipline.

Second: whenever a company you apply to publishes numbers like these, walking into the interview having done this arithmetic — "your listing implies about three demos a day; I'd want to understand what feeds them" — is a free way to stand out.

Worked example 3 — enterprise NHS clinical AI, where cycle length changes everything

Now the opposite motion: enterprise clinical AI — say a radiology AI platform — sold to NHS trusts. Illustrative numbers: £800k quota, £100k ACV, 20% win rate, 9-month sales cycle.

Deals: £800k ÷ £100k = 8 wins.
Opportunities: 8 ÷ 0.20 = 40 opportunities.
Pipeline: 40 × £100k = £4m — 5x coverage, because the win rate is lower.
The twist — timing: with a 9-month cycle, an opportunity created in April closes around January next year. So this year's £800k is essentially decided by the pipeline that exists by the end of Q1. Coverage isn't just "how much" but "how much, closable in the period". £4m of pipeline created in October is next year's number wearing this year's clothes.

Direct interview payoff. In a long-cycle role, a credible first-90-days answer acknowledges that year-one revenue comes largely from inherited or in-flight pipeline, and the pipeline you generate early is what makes year two. Saying that unprompted shows you understand cycle length — most candidates don't.

Worked example 4 — mid-quarter gap check

It's week 6 of a 13-week quarter. Quota £150k; you've closed £70k; open, closable-this-quarter pipeline is £200k; your win rate runs 30%.

Remaining target: £150k − £70k = £80k.
Expected value of the pipeline: £200k × 0.30 = £60k → on expectation you land at £130k, £20k short.
Coverage check: £200k ÷ £80k = 2.5x — below the 3.3x your 30% win rate demands (1 ÷ 0.30).
Required pipeline: £80k ÷ 0.30 = £267k → you need ~£67k of new closable-now pipeline, or to lift the win rate on what you have, or to pull a next-quarter deal forward.

The move in an interview (or a real pipeline review) isn't panic, it's exactly this arithmetic followed by a specific plan. "I'm at 2.5x against remaining target with a 30% win rate, so I'm £20k light on expectation — here are the two deals I'm accelerating and the outbound push filling the gap."