B2B sales funnel: stages, conversions and a worked calculation
A B2B sales funnel is a model that shows how many contacts move from stage to stage, from first interest to a signed contract. We cover the origins of the model, the TOFU, MOFU and BOFU stages, a worked example of conversion from leads to revenue, funnel metrics and the model's limitations when selling to buying committees.
Amounts and values in the examples are illustrative and show how the calculation works. In projects, we use the client's data.
Dominik Dębski · Lemur Media · · reading time: 4 min
Reviewed by Dominik Dębski, 1 November 2026
What is a B2B sales funnel and where does it come from?
A sales funnel is a customer acquisition model in which fewer contacts remain at each successive stage, and the ratios between stages give the conversion rates. The board uses it in three ways. It plans the number of leads needed to hit the revenue target. It looks for the stage where the company loses the most opportunities. It aligns definitions between marketing and sales.
The model grew out of the AIDA formula (Attention, Interest, Desire, Action), formulated in 1898 by the American advertising specialist Elias St. Elmo Lewis. In B2B sales, the most frequently cited model is the SiriusDecisions Demand Waterfall. The first version appeared in 2006, the model was rebuilt in 2012, and in 2017 it was replaced by the Demand Unit Waterfall, based on buying groups. Forrester acquired SiriusDecisions in November 2018.
What stages does the marketing and sales funnel have?
A typical B2B funnel has three parts: the top (Top of the Funnel, TOFU), the middle (Middle of the Funnel, MOFU) and the bottom (Bottom of the Funnel, BOFU), and the handover of a contact from marketing to sales is described by the MQL and SQL statuses.
| Part of the funnel | Stage | Who is responsible | Transition criterion |
|---|---|---|---|
| TOFU | Lead (contact) | Marketing | Contact details provided |
| MOFU | Marketing Qualified Lead (MQL) | Marketing | Fit with the ideal customer profile and a signal of interest |
| MOFU | Sales Qualified Lead (SQL) | Sales (SDR) | Confirmed problem, budget or decision date |
| BOFU | Sales opportunity | Sales rep | Meeting with a decision-maker and agreed scope |
| BOFU | Won contract | Sales rep | Contract signature |
Points-based lead assessment is covered in a separate article on lead scoring, and opportunity qualification using MEDDICC in another guide in the knowledge base. What happens after signature, i.e. onboarding, retention and account expansion, is covered by the Bowtie model.
How do you work back from a revenue target to the number of leads?
A B2B sales funnel is calculated backwards: the revenue target is divided by the average contract value, and the result is then divided by each stage's conversion rate in turn. The example concerns a B2B SaaS company with an average contract worth PLN 80,000 a year.
| Stage | Conversion to stage | Base case | Target PLN 2,400,000 |
|---|---|---|---|
| Leads | 2 000 | 2 400 | |
| MQL | 25% | 500 | 600 |
| SQL | 40% | 200 | 240 |
| Sales opportunities | 50% | 100 | 120 |
| Won contracts | 25% | 25 | 30 |
| Revenue (PLN 80,000 × contracts) | PLN 2,000,000 | PLN 2,400,000 |
From lead to won contract, 25% × 40% × 50% × 25% = 1.25% of contacts get through, i.e. 25 contracts from 2,000 leads. To reach PLN 2,400,000, the company needs 30 contracts (PLN 2,400,000 ÷ PLN 80,000), 120 opportunities (30 ÷ 25%), 240 SQLs, 600 MQLs and 2,400 leads. There is also a second route. The same PLN 400,000 of additional revenue comes from raising conversion from SQL to opportunity from 50% to 60%, without a single new lead: 2,000 × 25% × 40% × 60% × 25% = 30 contracts. The ratio of opportunity value to the sales target is covered in the article on pipeline coverage, and the effectiveness of closing opportunities in the article on win rate.
Which funnel metrics does the board track?
The board needs four groups of metrics: volume at each stage, conversion between stages, time spent in each stage and opportunity value.
- Volume: number of leads, MQLs, SQLs and opportunities per month, broken down by acquisition source.
- Conversion between stages: calculated for the cohort from a given month, because with a long sales cycle the result is otherwise distorted.
- Time in stage (velocity): median days from SQL to opportunity and from opportunity to signature.
- Value: average contract value and the sum of open opportunities set against the target.
- MQL acceptance by sales: the share of leads that sales reps accept for follow-up. It shows whether both departments understand the definitions in the same way.
If leads are growing while MQL acceptance is falling, marketing is usually meeting its volume target with contacts outside the ideal customer profile.
What are the limitations of the funnel model in B2B sales?
The funnel assumes a linear path for one person, whereas in B2B the decision is made by a buying group that gathers information in parallel and largely without contact with suppliers. According to Gartner, for a complex B2B solution the buying group usually includes 6 to 10 decision-makers. Buyers spend 17% of the entire buying process in meetings with potential suppliers. When they compare several suppliers, a representative of any one company gets only 5–6%.
- Non-linear path: buyers return to earlier stages, and one lead does not equal one buying decision.
- Buying group: several people from one company counted as separate leads inflate volume and depress conversion.
- No post-sale stages: the funnel ends at signature, although in a subscription model most customer value is created later.
- Attribution: the funnel does not show which marketing activities influenced the buying group's decision.
Companies selling to buying committees therefore calculate the funnel at account or opportunity level, and marketing and sales write down the stage definitions together.