Lead Velocity Rate (LVR): The Leading Indicator for SaaS Growth
This article argues that Lead Velocity Rate (LVR)—the month-over-month growth rate of qualified leads—is the most important metric for SaaS companies because it predicts future revenue and is a leading indicator unlike sales or pipeline. By targeting LVR growth 10-20% above desired MRR growth targets with a consistent sales team, SaaS companies can reliably forecast revenue 12-18 months in advance and identify systemic problems in sales execution or product quality.
Metrics in this report
10%
monthly
SaaS companies at $1M ARR
8%
monthly
SaaS companies at $3M+ ARR
10-20%
relative differential
LVR should exceed desired MRR growth by this range
12-18months
forward-looking
Period of visibility using LVR methodology
12+months
median
Time from initial lead creation to close
100%
minimum
Growth target supported by 8% monthly LVR growth