We’re fluent in startup finance. Now you can be too.

Learn more about common financial (and startup) terms here. To learn more about Pilot, fill out the form below.

Oops! Something went wrong while submitting the form.
Sales and Marketing Efficiency

What Is Sales and Marketing Efficiency?

Sales and marketing efficiency measures how much revenue you generate based on your sales and marketing expenses.

You can calculate your S&M efficiency by dividing your gross revenue or gross new annual recurring revenue (ARR) by your sales and marketing expenses for the period. As a rule of thumb, having a sales and marketing efficiency of at least 1 is an indicator that your business is efficiently using its sales and marketing budget.

Some software as a service (SaaS) companies also use the magic number to measure sales efficiency. Rather than using gross revenue, the magic number compares a company’s net new ARR for the quarter to the previous quarter's sales and marketing expenses.

Sign up for Pilot Bookkeeping

Signing up for Pilot is easy. We think once you experience truly stress-free financial processes, you won’t want to go back.

Oops! Something went wrong while submitting the form.
Close icon

Let's get in touch

Our experts can help you find the right solutions. Please provide a bit of information and we’ll be in touch.

Thank you!

We’ll be in touch via e-mail.

If you have a question, please feel free to e-mail us at info@pilot.com

Oops! Something went wrong while submitting the form.