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Master the essential revenue and financial metrics that drive B2B SaaS success. From ARR and MRR to retention metrics and customer economics, these terms are critical for understanding pipeline health, forecasting growth, and making data-driven decisions.
Time to Close
Short Definition
Definition
Time to Close tracks how long qualified opportunities take to convert into customers, typically measured from opportunity creation to closed-won. It focuses specifically on winning deals, making it a key input for capacity planning, forecasting, and sales velocity calculations in B2B SaaS. Unlike broader sales cycle length (which may include lost deals), Time to Close reveals how efficiently the sales process works for deals that actually close.
Sales leaders use it to set realistic quota pacing, determine pipeline coverage multiples, and identify process bottlenecks specific to successful deals. Shorter Time to Close improves cash flow, reduces sales capacity needs, and accelerates revenue recognition.
How to Calculate Time to Close
Time to Close is calculated only on closed-won deals:
Deal-Level Time to Close
Days from Opportunity Created Date to Closed-Won Date
Average Time to Close
Average Time to Close = ∑ (Close Date - Opportunity Created Date) for All Closed-Won Deals ÷ Number of Closed-Won Deals
Step-by-Step Calculation
- Filter to closed-won deals only in the period
- For each deal, subtract Opportunity Created Date from Closed-Won Date
- Sum all individual cycle times
- Divide by number of closed-won deals
- Segment by motion (inbound/outbound), segment (SMB/enterprise), or rep
Example
4 closed-won deals: 30, 45, 60, 75 days
Average Time to Close = (30 + 45 + 60 + 75) ÷ 4 = 52.5 days
Why Time to Close Matters
Time to Close directly impacts sales capacity, forecasting accuracy, and capital efficiency. Shorter times mean…
- Faster revenue realization and cash flow
- Higher sales velocity (more revenue per unit time)
- Lower sales capacity requirements (fewer reps needed for same quota)
- Better forecast timing (pipeline converts more predictably)
CROs target Time to Close reductions through better qualification, multithreading, Mutual Action Plans, and pricing clarity. It also reveals motion effectiveness: inbound typically closes faster than outbound.
Industry Benchmarks
Inbound motions typically move 20–30% faster than outbound motions. Best-in-class teams optimize by segment rather than chasing a universal number.
Real-World Examples
- A mid-market sales team shortens Time to Close from 68 to 48 days by implementing Mutual Action Plans, doubling quarterly closes without adding reps.
- Enterprise team discovers SMB inbound closes in 35 days vs. 120+ for cold outbound; reallocates SDRs to high-velocity channels.
- RevOps finds Proposal → Close takes 25 days on average; standardized pricing tables cut this to 12 days.
Common Mistakes
- Including lost deals in Time to Close calculations, inflating the metric beyond what matters for revenue forecasting.
- Inconsistent opportunity start dates (lead created vs. qualified opp vs. first meeting) breaking trend analysis.
- Not segmenting by motion/channel, hiding that SMB inbound closes 3× faster than enterprise outbound.
- Optimizing only for speed, sacrificing deal size or win rate by pushing unqualified deals faster.
- Ignoring stage-level timing, missing bottlenecks (for example, proposal → negotiation averaging 30 days).
The Fix: Calculate only on closed-won deals, standardize opp creation rules, segment by motion/segment/rep, and pair with stage conversion rates to identify specific process improvements.
Frequently Asked Questions
What’s the difference between Time to Close and Sales Cycle Length?
Time to Close measures closed-won deals only (revenue-relevant). Sales Cycle Length often includes lost deals. Use Time to Close for capacity/forecasting.
What's a good Time to Close for B2B SaaS?
SMB: 30–60 days.
Mid-market: 60–90 days.
Enterprise: 90–180 days.
Inbound opportunities tend to move 20–30% faster than outbound ones.
Should Time to Close include ramping reps?
Calculate it separately. Ramping reps typically have 20–50% longer Time to Close. Use fully-ramped benchmarks for planning.
How does Time to Close impact quota design?
Shorter cycles mean more closes per quarter per rep. A 60-day cycle might support 3 closes/quarter; a 90-day cycle supports 2.
Can Time to Close go down while revenue goes up?
Yes, if deal size or win rate increases offset longer cycles (higher velocity).
Last Updated: December 16, 2025
Reviewed by: Ben Hale