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# How to evaluate an account's revenue growth potential - Handbook

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# How to evaluate an account's revenue growth potential - Handbook

We don't have an automated "growth score" for expansion potential, and we probably won't for a while. The signals that matter most are human-judged (depth of buy-in, roadmap fit, whether the champion actually has budget authority) and they don't live in our data. They're hard to represent even heuristically.

So instead of a model, we have a shared framework. The goal is that two people looking at the same account land in the same ballpark. Your assessment should be reproducible by a teammate, not by a query.

Answer three questions, in order. Calling your own shot matters, but the shot has to be grounded in reality rather than wishful thinking.

1.  **Is there an expansion opportunity with this account at all?**
2.  **What specifically is the opportunity?**
3.  **How much is it worth, and how confident are you?**

## Question 2: What is the opportunity?

What's the growth lever? "This account can grow" is not an answer. "They're on monthly billing at $1.8k MRR and their platform team is trialing Error Tracking" is an answer. Most real opportunities group into one of these mechanisms:

| Lever | What it looks like | Where to go deeper |
| --- | --- | --- |
| Cross-sell (same team) | 1-2 products adopted, gaps in their current use case | [Go deeper](/handbook/growth/sales/expansion-strategies.md#strategy-1-go-deeper-on-the-existing-team), [cross-sell motions](/handbook/growth/cross-selling/cross-sell-motions.md) |
| New team / workload | Multiple teams or apps, only one instrumented | [Expand into new teams](/handbook/growth/sales/expansion-strategies.md#strategy-3-expand-into-new-teams) |
| Event-based add-ons | High event volume, no Identified Events / Group Analytics / Pipelines | [Pricing](/pricing.md), plus the math below |
| Platform package | >50 people, compliance/SSO/RBAC needs, no Boost/Scale/Enterprise | [Contract rules](/handbook/growth/sales/contract-rules.md) |
| Annual conversion / renewal uplift | Monthly billing >$500 MRR, or credit expiry approaching | [How commission works](/handbook/growth/sales/how-we-work.md#how-commission-works---technical-account-managers) |
| Organic usage growth | Forecasted MRR > current MRR, headcount growth, recent funding | Nothing to sell, but it's incremental cash you should forecast |

Two guiding principles:

-   **One primary lever per account per quarter.** Track several if you like, but your [account plan](/handbook/growth/sales/account-planning.md) should say which one you're actually focused on right now.
-   **The lever must attach to a person.** "They should adopt Session Replay" is a product observation. "Rui's team spends hours reproducing bugs from user reports, and Rui has budget authority" is an opportunity. Opportunities don't happen without people on both sides. If you can't name who buys it and why they'd care, you're still on Question 1.

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## Question 3: How much, and how confident are you?

There's no formula. There is a small set of evidence sources you can reliably build an estimate from, plus a discipline of writing down *how* you got the number so someone else can challenge it.

### Build every estimate from real evidence

**1\. Their own volumes against list pricing.** When the opportunity is usage-priced against data they're *already sending*, this is mostly arithmetic. Event-based add-ons are straightforward and you can calculate them in QuoteHog.

**2\. What they've told you.** Their current vendor's contract price, their company or product roadmap, their team sizes, their budget cycle. Most estimation problems are actually discovery problems: if you can't size the opportunity, the next step is getting the information that would let you. "What are you paying Sentry today?" and "how much traffic does the other product do?" are sizing questions.

**3\. Comparable accounts in your own book.** You have direct visibility into what accounts of similar size, archetype, and vertical spend on the product you're pitching. This is never 1:1, though similar companies still differ in org structure, product surface area, and how saturated they are across PostHog.

**4\. Bottoms-up from their product.** For a new workload or team, estimate from what you know about *that* workload: public traffic, app store presence, team size, and how the equivalent metric compares to the workloads they've already instrumented.

---

## Grow, nurture, or release

-   **Grow** — there's a real, qualified expansion opportunity. This account gets proactive TAM work this quarter.
-   **Nurture** — a real opportunity that isn't workable yet, because it's waiting on a funding event, a champion hire, or a roadmap item. If it's already a TAM account, it's fine to keep. If it isn't, it can wait for a TAM to be assigned.
-   **Release from TAM** — healthy and retained, but no viable growth. Drop it from TAM coverage per the [quarterly book planning rules](/handbook/growth/sales/account-allocation.md#quarterly-book-planning). This is a good outcome: it concentrates TAM attention where it compounds.

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