Lead Velocity Rate (LVR)
Lead Velocity Rate (LVR) is the month-over-month percentage growth in qualified leads, calculated as (this month minus last month) divided by last month.
Key takeaways
- LVR divides the month-over-month gain by last month's qualified-lead count.
- A weak previous month inflates the next month's rate into a false surge.
- A constant LVR means exponential growth, which gets harder as the base grows.
- Never annualise a monthly LVR by multiplying it by twelve.
- Publish the underlying lead counts beside the percentage or it misleads.
In depth
The formula takes this period's qualified-lead count, subtracts the previous period's, and divides by the previous period's, producing a percentage. Two properties follow from that division. The result is scale-free, so a funnel producing forty leads and one producing four thousand can be compared. And the base sits in the denominator, so the same absolute increase produces a smaller percentage each time the base grows. A constant LVR therefore describes exponential growth, not steady addition, and gets harder to hold every month.
Because the denominator is last period, LVR is extremely sensitive to a weak base. A poor month inflates the following month's rate and creates a rebound that looks like acceleration. The choice of period length is the main lever a team controls: monthly is standard and noisy, quarterly is smoother and slower to warn. Neither is wrong, but switching between them mid-series breaks comparability, and annualising a monthly rate by multiplying by twelve overstates growth badly.
In reporting, LVR usually appears as a twelve-month line with the underlying lead counts printed beneath it, so a reader can see whether a high percentage came from a large gain or a small base. Boards and investors read the consistency of the line rather than its peak. A scorecard funnel supports this because the qualifying tier is a stored threshold: the same rule that classified March classifies October, and the series stays comparable without anyone maintaining a spreadsheet definition.
LVR is unusable below roughly a few dozen leads per period, where percentage swings are dominated by chance. It is also blind to unit economics: a rate held up by cheap, low-value leads looks identical to one built on enterprise demand. Companies with lumpy, seasonal or project-driven sales see percentages that bounce meaninglessly month to month. And because a compounding percentage is unsustainable indefinitely, a declining LVR on a growing base is often normal maturity rather than a problem.
Example in practice
How to measure it
Compute the rate from two stored counts rather than from a rounded percentage carried forward, and keep both numbers in the same table as the result. Add a rolling three-month LVR alongside the monthly one; the smoothed line is what you act on, and the monthly one is what you investigate when the two disagree sharply.
To judge whether the rate is worth anything, compare its trajectory with revenue growth one sales cycle later over as many periods as you have. If the two move together, LVR earns its place in the forecast. Also track cost per qualified lead in the same view, because an LVR bought with rising acquisition cost is a spending decision rather than a demand signal.
Common mistakes
Teams present the percentage on its own, and a jump from four leads to six becomes a fifty percent LVR that goes into a board deck. The number is arithmetically correct and tells nobody anything. Always show the two counts that produced it, and add a minimum base below which you report the raw counts instead. The rule protects you from celebrating noise and from explaining it later.
The other frequent error is comparing an LVR calculated on submitted forms with a target set on sales-accepted leads, or comparing this year's figure with a period before a scoring change. Both compare two different definitions and call the difference growth. Store the definition with the series, and when the qualification rule changes, either restate the history or start a new line on the chart with a visible break.
Frequently asked questions
What is the LVR formula?
LVR equals this month's qualified leads minus last month's, divided by last month's, expressed as a percentage. For example, growing from 175 to 200 qualified leads yields a 14.3% LVR.
What is a good LVR?
There is no universal figure, and any number quoted without the base behind it should be ignored. Judge yours on consistency instead: a modest rate repeated every month compounds into far more pipeline than one large spike followed by flat periods. Compare it to your own trailing twelve months rather than to another company's.
Can LVR be negative?
Yes, whenever this period produced fewer qualified leads than the last. A negative reading is not automatically alarming: it may follow an unusually strong prior month, a paused campaign or a seasonal dip. What matters is whether negatives repeat. Two or three consecutive negative periods describe a real contraction in demand rather than a base effect.
Should LVR use monthly or quarterly periods?
Monthly if your lead volume is high enough that a month is not dominated by chance, quarterly otherwise. The trade is responsiveness against stability. Whichever you pick, keep it for the whole series; a chart that switches period length halfway shows a change in arithmetic that readers will interpret as a change in the business.
Why does my LVR fall even though leads keep rising?
Because the denominator grows with you. Adding the same number of leads to a larger base yields a smaller percentage each period, so a falling rate on rising volume is arithmetic, not decline. Read the absolute lead count next to the rate. A drop in the rate matters only when the absolute gain also shrinks.
Which leads should go into the LVR calculation?
The ones that meet a fixed, written qualification bar, applied identically in both periods. Most teams use sales-accepted leads or a scoring threshold, because those survive a change of personnel. Anything decided case by case will drift, and drift in the definition shows up in the rate as growth that never becomes revenue.
How do investors read LVR?
Mostly as evidence that growth is repeatable rather than as a target in itself. A steady line over many months suggests a working acquisition system; a jagged one suggests campaigns and luck. Expect to be asked for the underlying counts, the qualification definition and the cost behind the rate, since all three change how the percentage should be read.