01
Pre-PMF
Before anything repeats. The founder is still working out who buys, for what reason and at what price.
Held together by the founder
Growth stages
Six stages, six different constraints.
The commercial model that worked at one stage becomes the problem at the next. The leaks are the same kinds everywhere; which one costs you most moves with each stage.
By growth stage
Pick the one closest to where you are.
Six situations. What holds the company back moves as it grows, and each page says where the money tends to go.
02
Early Growth
The deals repeat; how they are won is known to two people and written nowhere a new hire could read it.
Held together by conversation
03
Scale-up
Qualifying splits from closing, managers are appointed, and the job one person did becomes a handoff nobody has defined.
Held together by role design
04
Expansion
A working model is copied into new regions, segments or teams. The playbook travels; the decisions behind it have to as well.
Held together by the system
05
Mid-market
The company becomes a set of departments, each running its own process against its own target. All of them reach it; the plan is missed between them.
Held together by structure
06
Enterprise
The model is mature and the trend is flat. No crisis, so the loss stays off the agenda for years.
Held together by governance
The evidence
Four numbers that move with the stage.
Each stage hands what holds the company together to the next, and the gap in that handover is where the leak sits. These four figures show how far the ground shifts between one ARR band and the next.
- 01
$90K to $380K
ARR per full-time employee in the top quartile, by ARR band: $90K under $10M, $160K at $10-25M, $215K at $25-50M, $220K at $50-100M, $250K at $100-250M, $280K at $250-500M and $380K above $500M. What one head carries is the first number a stage changes, and the one every headcount plan assumes will hold.
ICONIQ, State of Software 2025, quarterly operating data from 127 software companies, 2013 to Q2 2025, top quartile rounded, September 2025
- 02
291% to 76%
Total operating expense as a share of revenue at the median, by band: 291% under $10M ARR, 162% at $10-25M, 122% at $25-50M, 114% at $50-100M, 93% at $100-250M, 82% at $250-500M and 76% above $500M. Revenue starts to outpace the cost of the organisation around $100M-$200M ARR, and until then every stage is paying for a structure the last one did not have.
ICONIQ, State of Software 2025, 127 software companies, 314 to 133 company-quarters per band, median, September 2025
- 03
100% to 93%
Gross dollar retention in the top quartile: 100% under $10M ARR, 96% at $10-25M, 95% at $25-50M, 94% at $50-100M and at $100-250M, 93% at $250-500M, 97% above $500M. The best quartile starts losing revenue it already had the moment a second renewal cycle exists, and the median loses more at every band.
ICONIQ, State of Software 2025, 127 software companies, 351 to 62 company-quarters per band, top quartile, September 2025
- 04
12.9 to 14.8 months
CAC payback in the top quartile, by band: 12.9 months under $50M ARR, 12.3 at $50-100M, 13.3 at $100-200M and 14.8 above $200M. Every band past $100M adds time before a new customer has paid for its own acquisition, and that is the quartile with the shortest wait.
ICONIQ, State of Software 2025, 127 software companies, 410, 114, 138 and 115 company-quarters per band, top quartile, September 2025
Across all of it
The stage changes the surface, not the method.
The five steps, from finding the leak to handing the fixes over, are the same at every stage. What the stage changes is where the first step looks and what the third one finds.
- KKey breakFind the leak
- IInputsGather the evidence
- HHidden costPrice it
- OOrderFix list, in order
- NNamed ownersHand it over
Where it fits
What a finding needs that the stage cannot give.
Growth stage says which seam to look at first. It does not decide whether a finding will stand up.
- Wins that repeatUntil wins repeat, a pattern cannot be told from an experiment. Pre-PMF and early growth start with Build, which writes the first system down; a Diagnosis needs a system to read.
- Records you can openThe CRM history, the payroll and the people decide what a finding can claim. Without them, nothing holds.
- Authority to change thingsA fix list needs someone behind it with the authority to move roles, redraw handoffs and name owners.
Not sure? Book a strategy call →
Where to go next
Three doors from here.
- 01
See it by sector instead
Six sectors, six different disguises for the same leak, whatever stage you sit at.
- 02
See the six places it leaks
The six leaks, what gives each away, and which line of the accounts it lands in.
- 03
Put a number on yours
Two months in your records and with your people, ending in where the profit leaks, what it costs in your own figures and what to fix first.
FAQ
Before you pick a stage.
How do you know which growth stage we are in?
That is one of the things the Diagnosis works out rather than assumes. The stage a company says it is at and the stage it behaves like are not always the same.
Does headcount matter more than stage?
Stage matters more. Headcount says how many people the model has to carry; stage says what holds the model together. A company of forty that has just split qualifying from closing and one of four hundred making the same move sit at the same stage, and the Diagnosis reads the move, not the headcount.
We feel like we are between two stages, which page applies?
Read both. The move between two stages is where the leaks gather, because the commercial model built for the last stage has not yet been rebuilt for the next.
Can a company move backward a stage, not just forward?
Yes. The stages describe how complicated the commercial model has become, not a one-way path. A restructuring, a market shift or new leadership can put an established company back into patterns that look like an earlier stage.
Get started
Knowing the stage tells you where to look. Pricing the leak is the next step.
Thirty minutes on the stage you behave like, the records on hand, and whether there is anything to price. A proposal only follows if there is.