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FOUNDER’S GUIDE TO B2B SALES If the columns are months, if it has one row per seller, if you need to copy and paste rows to add new sellers, and to map expenses to general ledger accounts, it’s a budget – not a driver-based model Such budgets are too detailed and cumbersome to meet your planning needs. FP&A people tend towards driver-based models, while accountants/controllers tend towards budgets. Read more on the merits of driver-based models. KEY METRICS: INPUTS OR OUTPUTS? Sometimes, people get this backwards so let’s make it clear: the outputs of the model are key metrics, and the inputs are operational drivers. The model shows you the impact of varying different drivers and their impact on key metrics. Example Outputs • New ARR bookings • Ending ARR and ARR growth • CAC ratio • CAC payback period • Net retention • Rule of 40 score • FCF margin Example Inputs • Sales productivity • Sales hiring plan • Sales attrition • Expansion % • Churn % • Services attach rate • Subscription and services margins • Sales staffing, OTEs, and ratios • Marketing funnel conversion rates and costs • R&D and G&A % SPRING 2023 .53

BALDERTON The Founders Guide to B2B Sales - Page 53 BALDERTON The Founders Guide to B2B Sales Page 52 Page 54

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