The GTM due diligence glossary.

50 terms an investor, CEO or sales leader meets when a revenue engine is reviewed, each in plain English. Where a term is one of the ten areas we score, it says so.

Deals and investors

Due diligence: The checks a buyer or investor runs on a company before committing money: is what management says true, and what has not been said? It usually covers legal, financial, commercial and technical questions and, increasingly, how the company sells.
Commercial due diligence: The part of due diligence that tests the market: how large it is, how the company is positioned in it, and whether customers would buy again. It is usually built from customer interviews and market studies rather than from the company's own sales records.
Financial due diligence: The part that tests the accounts: whether revenue, costs, cash and debt are what the books say. It confirms the past; it does not say whether the sales team can deliver the plan.
GTM due diligence: A review of how a company finds, wins and keeps customers, built from its own sales and customer records plus interviews with the team. It answers whether the revenue is real, where it is at risk and whether the growth plan can be delivered. We score it across ten areas.
Letter of intent and exclusivity: A letter of intent is a non-binding offer that sets the price and main terms before the detailed checks start. Exclusivity is the period, usually a few weeks, in which the seller agrees to talk to no other buyer; most due diligence happens inside it.
Investment committee: The group inside a fund that decides whether a deal goes ahead. Due-diligence reports are written to answer its questions, so a finding is only useful if the committee can act on it.
Deal team: The people at a fund who run one transaction: finding it, commissioning the due diligence and negotiating the terms. They are the day-to-day client of a GTM review.
Operating partner: A senior person at a fund, usually a former executive, who works with portfolio companies on performance after the deal rather than on buying and selling. Operating partners often own the sales and marketing parts of a value creation plan.
Portfolio company: A company a fund has invested in and still owns. A fund with many of them may run the same GTM check across all of them to see which need attention first.
Value creation plan: The written plan for how a company will be worth more by the time the investor sells: growth, profit, acquisitions and the operating changes needed to get there. GTM findings feed its revenue part.
100-day plan: The list of actions for the first hundred days after a deal closes, ordered by what matters most. A good one comes straight from the findings of due diligence, so that nothing found is forgotten.
Red-flag check: A short, early review that looks only for problems serious enough to stop or reprice a deal, before anyone pays for a full review. It ends with a short list of concerns, or a note that none were found.
Vendor or sell-side due diligence: Due diligence commissioned by the seller and shared with prospective buyers. It saves every bidder running the same checks, but buyers normally confirm the parts that matter most to them.
Buy-and-build: A strategy where a fund buys one company as a base and adds smaller ones to it. Each addition brings its own sales team and process, so a shared go-to-market model matters more here than in a single purchase.
Exit readiness: How prepared a company is to be sold or listed: clean records, a forecast that has held up, retention that can be shown by customer segment, and a sales engine that does not depend on the founder. Investors start on it a year or two before the planned sale.

Revenue and retention

ARR: Annual recurring revenue: the yearly value of subscription contracts in force today, excluding one-off fees and services. It is the base figure most other revenue measures are built on.
Net revenue retention (NRR): What last year's customers pay today as a share of what they paid a year ago, after cancellations, downgrades and upgrades. Above 100% means the existing customers grow on their own; it is one of the figures investors weigh most.Scored under Function assessment.
Gross revenue retention (GRR): The same as net revenue retention but without the upgrades, so it can never exceed 100%. It shows how much of the revenue base is kept, and is the better test of whether customers stay.Scored under Function assessment.
Churn: Revenue or customers lost in a period because contracts ended or were not renewed. It is reported as a share of the starting base and should be read by segment, because an average hides where the losses are.
Expansion: Extra revenue from existing customers: more users, more products or a higher price at renewal. A named expansion motion, with an owner and a target, is a sign the existing customers are being worked rather than waited on.
Customer concentration: How much revenue depends on a few customers, usually the share of the largest one and of the top ten. High concentration makes revenue fragile: one lost renewal can undo a year of new sales.
CAC payback: The months it takes for a new customer's gross profit to repay the sales and marketing cost of winning them (the customer acquisition cost, or CAC). Shorter is better; we read it by segment and by channel.Scored under Outbound.
Sales cycle: The time from a deal first being qualified to the contract being signed, measured on won deals and by segment. It sets how far ahead pipeline must be built, and a cycle that is lengthening is an early warning.
Average contract value (ACV): The yearly value of a typical contract, by segment. The trend matters as much as the level: deals that get smaller while the cost of selling stays the same erode the economics.
Discounting and price realisation: Price realisation is the price actually paid as a share of the list price; discounting is the gap. Discounts that cluster in the last week of a quarter, or vary widely between salespeople for similar deals, are red flags.Scored under Sales process rigour.

Pipeline and forecast

Pipeline coverage: Open deals expected to close in a period, divided by the revenue still needed in that period. Management usually quotes about three times, but the figure only means something once the pipeline has been cleaned (see clean coverage).Scored under Pipeline management.
Clean coverage: Pipeline coverage after removing deals that are past their close date, stale, or have no value entered. It is the figure we use, because the headline number almost always includes deals that will never close.Scored under Pipeline management.
Stage ageing: How long a deal has sat in its current stage compared with how long won deals typically spent there. A deal at one and a half times the usual time is aged; at two and a half times it is treated as stale.Scored under Pipeline management.
Stale deal: An open deal with no logged activity for sixty days or more, or that has sat in its stage two and a half times longer than won deals usually do. Stale deals are removed before coverage is counted.
Slipped deal: A deal whose expected close date has been moved later at least once. Three or more pushes mark it as chronic, and the share of a quarter's forecast that slips is a forecasting measure in its own right.
Forecast accuracy: How close the forecast was to the actual result: one minus the gap as a share of the actual. We score it at the sixth week of the quarter over several quarters, and note separately whether the misses lean optimistic or cautious.Scored under Forecasting.
Forecast categories (commit, best case): The labels a sales team puts on open deals to say how sure it is: commit (expected to close), best case (could close), pipeline (open but early) and omitted (left out). Each category should close at a predictable rate, with commit the highest; if it does not, the labels mean nothing.
Win rate: Deals won divided by deals won plus deals lost, for new business, by count and by value. We compute it by segment, source and salesperson, and mark any group under fifteen closed deals as too small to trust.Scored under Sales process rigour.
Pipeline created: The value and number of qualified deals added in a period, by source and segment. It is the leading indicator for the quarters ahead and is measured against a creation target worked back from conversion by stage.
Conversion by stage: The share of deals that move from one stage to the next, by segment. It shows where deals die, and a company that knows it can plan how much pipeline it needs rather than guess.

People, process and systems

Quota attainment: A quota is the sales target set for one salesperson. Attainment is how much of it they reached; the share of fully ramped salespeople at or above quota is the measure we score.Scored under Talent evaluation.
Ramp time: The months from a salesperson's hire to their first quarter at eighty per cent or more of quota. It drives capacity planning and the real cost of hiring.Scored under Talent evaluation.
Ideal customer profile (ICP): A written description of the customers the company wins, keeps and makes money from: size, industry, situation and who buys. The test is the share of new revenue that comes from it.Scored under GTM operating model.
Segmentation: Splitting customers and prospects into groups, usually by size, region or industry, that are sold to differently. Every measure should be computed by segment first, because blended averages hide weakness in one group behind strength in another.
Sales process and exit criteria: The sales process is the set of stages every deal passes through. Exit criteria are the evidence required before a deal may move to the next stage, such as a confirmed budget or a named decision-maker; whether the CRM enforces them is the core question.Scored under Sales process rigour.
Qualification: The questions asked early to decide whether a deal is worth pursuing: is there a real problem, money, a decision-maker and a reason to act now. Qualification fields left blank on a large share of deals is a red flag.
RevOps: Revenue operations: the function that owns the sales data, systems, reporting and process across the sales, marketing and customer teams. A named RevOps owner is one mark of a mature tech stack.
CRM: Customer relationship management software: the system of record for accounts, contacts, deals and activity. A read-only export of it is the main data source for a GTM review, and its field completion and duplicate rate are scored.Scored under Sales and marketing tech stack.
Tech stack: The set of software tools the revenue teams use, from the CRM to outreach, data and reporting tools. We look for overlap, cost, ownership and whether each tool is actually used.Scored under Sales and marketing tech stack.
Operating rhythm: The fixed cadence of meetings and reviews through which the revenue engine is run: weekly pipeline and forecast reviews, monthly plan checks, quarterly planning. Who owns each number in that rhythm is part of the operating model.Scored under GTM operating model.
SDR and outbound: Sales development representatives (SDRs) find and qualify new prospects, usually by email and phone, and hand them to a salesperson who closes. Outbound is the whole motion of creating pipeline rather than waiting for it; the SDR team is also scored as a function.Scored under Outbound.
Sales engineering or presales: The technical specialists who run discovery, demonstrations and proofs alongside salespeople. The test is whether deals with presales involved are won more often than those without.Scored under Function assessment.
Enablement: Onboarding, training and content that help salespeople sell the way the process says. Its effect is measured on ramp time and win rate.Scored under Function assessment.
AI readiness: Whether a company's data, permissions, documents and approval paths are in a state where AI tools could work reliably: clean CRM records, clear access rules, a written process. The result runs from Ready through to Not ready.Scored under Process and AI maturity.
AI exposure: How much a company's product and its customers' buying process could be changed by general-purpose AI models, for better or worse. It is assessed separately from AI readiness: readiness is about the company's own house, exposure is about the market around it.Scored under Process and AI maturity.

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Due Diligence / Data-Driven / Double-Digit