Sales Productivity and Acquisition Economics: The Certified Data

Payback, Magic Number, and AE Productivity

2025E efficiency distribution (2025 Survey, p. 34, forecast): gross magic number median 0.7, 25th percentile 0.5; net magic number median 0.5, 25th percentile 0.3.

Acquisition Economics by Ownership

Source: 2025 Survey, p. 10 (medians)

Ownership barely changes the acquisition math: PE-backed and VC-backed companies land within a few points of each other, and of the overall medians, on both fully-loaded payback and the gross magic number. That negative result is the point. The payback and magic-number problems this section documents are not an artifact of one financing model; they show up across the sample, which points at the shared cause the page returns to below, retention rather than the cost or structure of selling. Inference

Go-to-Market Motion and Structure

Field sales still dominates how new ARR is won. Field sales drove 56% of 2024 new ARR and inside sales another 28%, so direct human selling accounts for more than four-fifths of the total, with channel, self-serve, and other splitting the rest.

Source: 2025 Survey, p. 27 (2024 new ARR by go-to-market motion, averages)

Underneath that motion the team structure is lean: a median 3.2 AEs per sales engineer, 2.8 per SDR/BDR, and S&M spend splitting 63% to sales and 37% to marketing (2025 Survey, p. 30).

How large that organization is relative to the whole company depends on scale, and not in a straight line.

Source: 2025 Survey, p. 29 (sales org as % of total headcount, 2024)

Sales and marketing headcount peaks at 26% of the company in the $10-25M band, exactly the scale where growth begins to decelerate. It runs at 13% below $10M, bulges to 26% and then 23% through the mid-market, and falls back to 14% above $50M. The heaviest go-to-market investment lands right where the median company’s growth starts to fade (see Growth and New-ARR Composition). Inference

Reading the Churn Tax

Two payback series appear in the survey, and the difference between them carries the CAC Trap argument. The fully-loaded figure, which credits expansion revenue against total S&M spend, sits at a survivable 24 months. The new-business-only figure, which isolates what it actually costs to land a new customer, has lengthened from 31 to 35 to 37 months across three actual years. At a median one-year contract and 86% gross retention, roughly 37% of newly acquired customers, more than one in three, churn before a 37-month payback ever completes. [Inference: derived from the certified churn and payback inputs]

The quota rows contain their own tell: the median AE quota has been functionally frozen at $800K for three actual years while median attainment fell to 70% in 2024; the median AE delivered roughly $560K against an unchanged number. [Inference: product of the two certified medians] Note the definitional asymmetry: AE productivity is computed as (new-logo + expansion ARR) divided by quota-carrying AEs, so sales gets credited with expansion output that Customer Success also touches (see The Invisible Function).

This section underwrites The CAC Trap primarily, with supporting evidence for The Churn Tax and The GTM Machine.