The Ultimate SaaS Funnel Guide

February 26, 2019

Editor’s Note: This post was originally published in 2017 and updated February 2019.

Funnel conversion is fundamental for SaaS growth. Your funnel is your insight into your prospect’s journey with your company. It should highlight the key stages they move through and uncover any friction points in the process. A well-tracked funnel gives you the foundation to optimize your marketing, product, sales and CS strategy to rapidly and efficiently scale your SaaS business. Without it, you hope leads will turn from a website visitor into a satisfied, paying customer, despite the many steps in between.

To help you go from hope to mastery, we’ve compiled this updated guide to provide you a one-stop resource for best practices on how to set up your funnel, methodologies to optimize it as well as the hiring fundamentals to build a team that will continue to take your funnel and your business to new heights.

Table of Contents

SaaS Funnel Basics: Stages, Definitions, Metrics

Master The SaaS Customer Lifecycle Funnel: Acquire, Engage, Retain
This article is must read for anyone looking for a high-level overview of the SaaS funnel. It demonstrates the importance of looking at the customer lifecycle as one big funnel in order to understand the SaaS customer lifecycle.

2019 Update: SaaS Metrics – A Guide to Measuring and Improving What Matters
David Skok’s post synthesizes the high-level goals of a SaaS business and drills down layer by layer to expose the key metrics that will help drive success. Looking for even more? Check out his follow-up post as well.

SAL is the Glue that Binds Sales and Marketing in Lead Generation
Need a refresher on your SaaS funnel acronyms? Industrial Marketing provides clear definitions on key funnel stages, specifically highlighting the importance of SAL – the binding force between marketing and sales.

Why Product Qualified Leads are the Answer to a Failing Freemium Model
Are product qualified leads (PQLs) relevant for your SaaS funnel? Learn about the spectrum of PQLs to determine whether they are a fit for GTM motion.

2019 Update: HubSpot’s 6 Steps to Building Out A PQL Model
Looking for best practices on PQL models? Check out this article to get some great insights and details about how HubSpot successfully integrated PQLs into their go-to-market strategy. Kieran Flanagan, VP of Marketing at HubSpot shares his experience and offers a step-to-step guide to building out a PQL model.

Optimizing the SaaS Funnel from Top to Bottom
This article contains a list of resources that will help you dig deeper into each of the key levers within the SaaS funnel. Additionally, the video offers a simple model of a SaaS business and highlights key areas for optimization within the SaaS funnel.

18 Metrics Every SaaS Company Should Track
Databox has compiled a comprehensive list of key metrics every SaaS company should track in addition to providing definitions for some of the more common funnel terms to help first-timers started.

2019 Update: OpenView Expansion SaaS Benchmarks
A well analyzed funnel helps you increase win rate and decrease CAC. Curious to know how you stack up against your peers on these key metrics as you tweak your funnel? Check out OpenView’s Expansion SaaS Benchmarks.

Marketing Methodologies that Drive Funnel Conversion

7 Laws of Sales Funnel Physics Every SaaS Business Needs to Know
There are success patterns that can be recognized across the fastest growing SaaS businesses. Read this article to uncover the 7 laws of sales funnel physics to understand how you influence the leads in your funnel.

Why You Should Sell To Users, Not Buyers: A Product led Approach To Marketing
Product led growth is a capital efficient model through which companies can scale quickly. This article is an excerpt from OpenView’s product led growth ebook that will help you understand how to take a product led approach to marketing in order to efficiently unlock scale.

2019 Update: Product Led Growth: How to Build Marketing Into Your Product 
The approach of incorporating marketing into your core product features is one effective product led growth strategy. Check out this article to get an overview of specific in-product marketing tactics and how they can help power organic user growth.

3 Lessons Smart Marketers Can Learn From Growth Hacking
So how do you get started with growth hacking? Read this article to learn three basic steps on how to get started with continuous, rapid testing to iterate and improve your funnel conversion.

2019 Update: The Definitive Guide to Growth Hacking
Bought into the growth hacking revolution? Neil Patel and Bronson Taylor put together a 10 chapter definitive guide with everything you need to to know when it comes to growth hacking.

17 Best Sales Funnel Examples to Help Your Website Convert More Customers
Want to see how some of the highest converting businesses today convert leads on their site? Check out this article to see 17 examples of the highest-converting funnel on the web today from large companies like NetFlix and Groupon to small companies like Crazy Egg and Mixergy.

Building an All-Star Team Around your SaaS Funnel

Building a Funnel Centric Company
The funnel is the backbone of marketing initiatives. While the funnel and various conversion steps are tracked in your reporting. many fail to align their teams to this. In this article, you’ll learn how to structure your marketing department, goals and strategies-around a funnel that has been very carefully thought out and is ever evolving.

2019 Update: Why Product Teams Must Join the Customer Acquisition Process – and How to Make It Happen 
Companies with a product led growth strategy put the product at the center of everything they do. To do this successfully, you must also adapt your organizational structure. The CEO at Aptrinsic shares how to ensure product and marketing work hand in hand.

3 Models Of Effective Sales Team Organization
Product led SaaS companies achieve early scale with a self service model. As they gain traction and look for outlets of future growth, building out your sales team is likely the next step. This article contains the three basic sales team structures that you can use to ramp up your sales game and start off on the right foot.

How to Structure a Marketing Team of Any Size
Marketing teams play a pivotal role is driving awareness, but also helping to convert leads to customers. This article gives a snapshot of how your marketing team should evolve as your company scales.

Bonus: SaaS Podcasts

2019 Update: OV BUILD
We’re biased, but of course we love OpenView’s BUILD podcast. Are you wondering how your SaaS business is performing compared to peers? Check out Season 2 focused on SaaS benchmarks. Ever heard of Product Led Growth? Check out Season 3 where leaders from top performing PLG software companies share their secrets.

5 Of The Best SaaS Podcasts
Want ongoing tips on how to unlock scale at your SaaS business and optimize your funnel? Check out these top five SaaS podcasts to stay up to date and learn from the best in the business.

If you’re building a B2B SaaS company and you’d like to talk strategy or fundraising, we want to hear from you. Please reach out to [email protected].

Ashley Minogue

Senior Director of Growth

Ashley is Senior Director of Growth on OpenView's Expansion team. She helps OpenView’s portfolio companies achieve repeatable scale via marketing, sales and pricing strategy optimization. Most frequently, she partners with the portfolio on projects related to improving lead funnel conversion, customer segmentation, sales process, pricing and demand gen. Prior to joining OpenView, Ashley was the Senior Manager of B2B Strategy & Analytics at Her efforts spanned marketing, BDR optimization & funnel analytics to help the B2B business grow by 9x in just a few years. Before, Ashley worked as a consultant for Simon-Kucher & Partners, the global marketing and strategy consulting firm known as the world leader in pricing.