SMB sales is a volume game with different economics than enterprise. What works, what breaks, and how to know when the segment is fundable.
SMB sales looks easier than enterprise because deals close faster. The math is unforgiving: high volume, low ACV, and churn that can eat every new customer if the motion isn't tight.
SMB reps typically close 8-20 deals per month at $500-5K ACV. Cycles measured in days, not months. One or two calls, sometimes fully self-serve with sales-assist. Anything slower and the CAC doesn't work.
SMB monthly churn of 3-5% is normal, above 7% is unfundable. Small businesses fail, change tools, and cut costs. Design pricing and product to keep churn survivable — usage-based often churns better than seat-based here.
CAC payback under 12 months is the SMB standard. LTV/CAC above 3, but LTV assumptions must be honest about churn. Free trial-to-paid conversion should exceed 15% for PLG-heavy motions.
Massive TAM (millions of businesses). Efficient acquisition (SEO, PLG, or paid at low cost). Sub-10% monthly churn. Path to $5K+ ACV as customers grow with you. Without those, SMB is a lifestyle business, not venture.
Investor directory · Fundraising library · Articles A–Z · Company funding database