Most marketing targets I inherit are either a lead number someone picked because it sounded ambitious, or last year plus a percentage. Neither connects to the revenue plan the CFO is holding. The fix is not complicated. You work the funnel backwards from the revenue number, using your own conversion rates, and you agree up front which pipeline marketing is accountable for creating and which it merely touches. Here is the method I use with founders and finance leads in the first month of an engagement.
Start from the new-business revenue number, not from leads
The target has to begin where the board conversation begins: revenue. Take the annual plan and strip out what does not need new pipeline. Renewals and most expansion revenue come from the existing customer base and belong to customer success or account management, so remove them unless marketing genuinely runs an expansion motion. What is left is new-business revenue, and that is the only number the reverse funnel should start from. Next, split it by quarter, and be honest about ramp. If you are hiring two account executives in month four, the second half of the year can carry more, but the first half cannot. Then convert revenue into deals using your average deal size for new customers, measured over the last two or three quarters of closed-won deals, not the price on the pricing page. If you sell to two very different segments, say mid-market in India and larger US accounts, run the math separately for each. Blending a small and a large deal size gives you an average that describes neither segment, and the resulting targets will be wrong in both. The output of this step is simple: the number of new deals you need to close each quarter, per segment.
The reverse-funnel math, step by step
Once you know deals needed, divide your way up the funnel using your own historical stage conversion rates. Deals needed divided by opportunity-to-win rate gives opportunities needed. Opportunities divided by SQL-to-opportunity rate gives SQLs. SQLs divided by MQL-to-SQL rate gives MQLs. MQLs divided by lead-to-MQL rate gives raw leads. Here is an illustrative example with made-up inputs, purely to show the arithmetic: a quarterly target of 30 new deals at a 25% win rate means 120 opportunities. If 50% of SQLs become opportunities, you need 240 SQLs. At a 30% MQL-to-SQL rate that is 800 MQLs. Then add time. Your sales cycle shifts everything earlier: if the median cycle is 90 days, the opportunities that close in Q3 must be created in Q2. Finally, express the target in pipeline value as well as count, because pipeline value is what finance can reconcile against the revenue plan. Use your own rates, not industry benchmarks. Benchmarks are useful for spotting a broken stage, which I cover in the B2B funnel benchmarks piece, but your plan should run on your data. The conversion funnel calculator linked below does this math for you.
Sourced vs influenced pipeline: define both before you set the target
Marketing-sourced pipeline is pipeline where marketing created the first meaningful interaction that led to the opportunity: an inbound demo request, a paid search lead, a webinar registrant who became an opportunity. Marketing-influenced pipeline is any opportunity where marketing touched someone on the buying committee at some point, including deals that sales prospected into first. The problem is that influenced pipeline is almost always a large share of total pipeline, because marketing touches nearly everyone eventually. Setting a target on influenced pipeline produces a number that is easy to hit and tells the CEO very little. My rule: the accountable target is sourced pipeline, written as a value and a count per quarter. Influenced pipeline is reported alongside it as context, never as the headline. Write the sourcing rule down in the CRM: which field records original source, when it is locked, and who can change it. If a sales rep can overwrite source after the fact, the sourced number will drift toward whoever is closer to the quarter-end review. I go deeper on stage definitions and handoff rules in the MQL to SQL handoff playbook.
Splitting the target between marketing, sales and partners
Not all of the pipeline has to come from marketing. In most growth-stage companies I work with, pipeline comes from three or four places: inbound marketing, outbound prospecting by SDRs or AEs, partners or referrals, and existing customers. Before you hand marketing a number, agree the expected share for each source with the sales leader and the CFO in the same room. Base the split on what actually happened over the last few quarters, then adjust for decisions you are making now, such as adding outbound headcount or cutting a channel. Write the split as a table: source, expected opportunities per quarter, expected pipeline value, owner. Two cautions. First, every source needs its own conversion rates, because outbound opportunities, partner referrals and inbound demos rarely close at the same rate or the same deal size. Second, decide in advance what happens when one source overdelivers and another underdelivers. If inbound beats its number while outbound misses, the company still needs the total. A shared total with individual source targets keeps teams honest without turning the weekly pipeline review into a credit dispute.
Add coverage, then pressure-test against budget
A pipeline target that exactly equals the revenue target divided by win rate leaves no room for slippage. Deals slip quarters, get downsized and stall, so most sales leaders want a coverage ratio: pipeline value at the start of a quarter as a multiple of the quarter's target. There is no universal right ratio; it depends on your win rate and how reliable your forecast has been. Use your own history: if your win rate on qualified opportunities is low, the coverage you need is higher. Then do the step most teams skip. Convert the lead and MQL numbers into spend using your actual cost per lead or cost per opportunity by channel, and compare it with the budget you have. If the reverse funnel says you need far more qualified leads than your budget can buy at current cost, you have three honest options: raise the budget, improve a conversion rate, or lower the revenue plan. What you cannot do is keep all three fixed and hope. Showing that trade-off to the CEO and CFO early is far better than discovering it at the end of Q2.
Review cadence: what to look at monthly and quarterly
Pipeline targets only work if they are reviewed against leading indicators, not just closed revenue. Monthly, I look at sourced pipeline created against target, by source and segment, and at stage conversion rates against the rates the plan assumed. If MQL volume is on plan but SQL acceptance has dropped, the problem is lead quality or sales follow-up, and spending more will not fix it. Quarterly, I re-baseline: recompute win rate, deal size and cycle length from the last two quarters, and re-run the reverse funnel for the rest of the year. If the assumptions moved, the target moves with them, and finance should see that adjustment explicitly rather than discover it later. The other quarterly check is pipeline velocity, because a target hit with slow-moving or stale opportunities is not the same as one hit with deals that progress. Keep a single source of truth for all of this in the CRM, with a short definitions sheet both teams have signed off. The goal is that the CEO, the CFO, the head of sales and marketing all read the same number the same way.
FAQ
Set the accountable target on sourced pipeline, as both value and count per quarter. Report influenced pipeline as context. Influenced numbers are usually large because marketing touches most deals eventually, so they make a weak target.
Use your own historical rates for the plan. Benchmarks are useful for spotting which stage looks broken, but planning on someone else's conversion rates usually produces a target your funnel cannot deliver.
Review progress monthly and re-baseline quarterly. If win rate, deal size or cycle length moved, re-run the reverse funnel and show finance the adjusted target explicitly.