How to build a bowtie data model for better revenue growth in your SaaS business

You finally closed that big deal. Dashboards are updated, and the champagne emojis are flying in Slack. But a few months later, the customer goes dark. They churn before renewal, and just like that, the ARR you worked so hard to win is gone.

The bowtie model sheds light on this blind spot in the traditional sales funnel, which ends at the close—in SaaS, the sale is where the real journey begins. The bowtie model is a full-funnel framework purpose-built for SaaS companies.

In this guide, we help you go beyond the basics and walk you through how to build, structure, and analyze a bowtie sales funnel.

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Foundational concepts underlying the structure of the bowtie sales funnel in SaaS

If you’ve never heard of the bowtie sales funnel, you may want to start with our introductory guide to bowtie modeling. Then jump back here for a deeper dive into the underlying mechanics of the bowtie model. Specifically, we’ll look at how to think about its structure so you can build a robust data model for your SaaS business.

The premise of the bowtie model is simple—SaaS revenue generation doesn’t stop at the sale, so your sales funnel shouldn’t either. 

The left side of the bowtie represents the go-to-market (GTM) strategy. It’s the journey from awareness to acquisition that you also see in a traditional sales funnel. The bowtie model extends this funnel into the customer success (CS) territory on the right side. The right side captures the revenue earned after the sale through renewals and expansion as well as reductions in revenue due to downgrades and churn.

This is critical because the majority of a SaaS company’s customer value comes from renewals and expansion. Acquisition is merely a long-term starting point for revenue generation.

You need to understand two key components to build a bowtie model as a data structure:

• Stages: The high-level phases of your customer’s journey, from first contact to long-term expansion.
• Conversion subsystems: The tactical machinery and metrics that govern how customers move from one stage to the next.

Let’s take a closer look at these.

Stages

The bowtie model has six stages, split evenly across the customer journey:

• Left side (GTM): Awareness > Education > Selection
• Right (CS): Onboarding > Adoption > Expansion

The left shows stages similar to the traditional sales funnel. Most SaaS companies already have these mapped in their CRM.

On the other hand, stages on the right often live in CS tools and may be less formally structured. That’s why bridging both sides in a single model is so powerful, and why tools like Drivetrain, which pull data from both systems, are key to operationalizing it.

Conversion subsystems

Unlike stages, conversion subsystems are dynamic. They’re the conversion events and processes that move prospects (on the left) and customers (on the right) through the bowtie.

Left side (GTM)

On the left, conversion systems are defined by your GTM strategy. Most SaaS businesses use one or a combination of the following strategies:

• Inbound (organic)
• Outbound (sales-led)
• Account-based (sales- and marketing-led)

Each strategy has a different conversion path through the bowtie funnel.

For example, for inbound prospects, the journey might start with someone downloading a whitepaper or becoming a marketing qualified lead (MQL).

On the other hand, a lead generated through sales and marketing might start with a hand-picked marketing qualified account (MQA) selected from an enriched total addressable market (TAM) list.

Note that you may have multiple conversion subsystems within a single stage for different GTM strategies. Here’s an overview:

A few notes:

• Both outbound and account-based strategies typically begin with a TAM list and are then enriched with firmographic and intent data.
• Account-based strategies often begin with content engagement and scoring, and selecting MQAs that meet a threshold.
• A suspect is someone in your TAM whom you haven’t qualified into your funnel yet.
• Naming conventions for these subsystems (MQL, SQL, SAL, etc.) matter. Define them clearly and consistently to align your bowtie with your CRM and reporting logic.

Right side (CS)

On the right side, conversion subsystems reflect your CS strategy built around three core objectives:

• Onboarding: Get customers to first value quickly.
• Adoption: Ensure customers get enough value to renew.
• Expansion: Increase value over time via upsell/cross-sell.

CS processes are typically less standardized than GTM. They may vary widely based on product, customer segmentation, and CS delivery model (high-touch, tech-touch, etc.). However, the underlying logic is consistent:

A deep dive into the conversion subsystems of your bowtie sales funnel

In each subsystem of the bowtie model, you define:

• An input (such as MQLs, opportunities, active users)
• An output (SQLs, mutual commit, monthly recurring revenue)
• A time dimension (how long it takes to convert)
• A conversion rate metric

Let’s look at each subsystem as part of the six high-level stages we discussed earlier.

Awareness stage subsystems

Subsystems in this stage are a gateway to your revenue engine. It’s the first moment a lead stumbles upon your solution, feeling it might solve a challenge they’re facing.

The goal of this subsystem is to transform anonymous or loosely defined “prospects” into qualified leads. A lead is a prospect who has engaged with one or more touchpoints to indicate interest. For example, a prospect may have downloaded a gated resource, subscribed to your newsletter, or attended a webinar.

The goal of each touchpoint is simple—to create problem awareness and urgency. These touchpoints educate prospects about a problem they’re facing, often one they haven’t fully defined yet, and the cost of doing nothing.

The touchpoints can vary based on GTM strategy, but awareness is usually driven by:

• Content marketing (blogs, whitepapers, ebooks) that speaks to the customers’ pain points and their business consequences
• Social engagement (LinkedIn thought leadership, community involvement)
• Advertising (search, display, social) that leads with the problem, not the product
• Events and webinars that introduce key industry trends or challenges
• Cold outreach in outbound and account-based marketing (ABM) strategies that highlight a relevant, unaddressed issue

Education stage subsystems

This is where curiosity turns into consideration. The prospect is now aware of a problem and actively trying to understand how urgent it is, what solutions are available, and whether your product deserves a closer look.

In this stage, your job is to assist the customer as they explore the full scope of their problem, compare approaches, and begin to see how your product can solve it.

This is a crucial moment. If the lead can’t make the case internally that the pain is real, costly, and fixable with your solution, they’ll probably stall or ghost. Your messaging, sales, discovery process, and educational content must converge here to make a strong case for your solution.

The conversion in this stage depends on your GTM motion:

• Inbound: This might look like an MQL > SQL conversion, where a lead who downloaded content or attended a webinar is now actively engaging with sales (by booking a demo, for example).
• Outbound: Typically involves a cold outbound lead showing intent during discovery, who is then promoted to an SAL.
• Account-based: As the buying group engages and shows interest, you may move them from MQA > SQA > SAL.

Each of these motions will have its own qualification criteria, but there’s a common denominator—a real, verified problem, a commitment to resolving it, and some signal of urgency.

But be careful: Misalignment between sales and marketing is most visible in this stage.

For example, if marketing pushes a lead based on weak engagement (say, a single ebook download), and sales expects a qualified opportunity to have strong intent (real use case + budget + timeline), you have a problem.

This is precisely why you need to define conversion points in very specific terms:

• What qualifies as a sales qualified lead for a handoff?
• What does “qualified” mean in your sales context?
• Who makes the call?

Selection stage subsystems

This is where intent turns into a decision. So far, your prospect has identified a problem, evaluated potential solutions, and decided your product is worth serious consideration.

Now, they’re weighing options—how to buy, when to buy, and whether to buy from you.

Your job? To guide the prospect through the decision-making and purchasing process. Depending on your business model, this process might be quick or slow.

For example, for a product-led SaaS, this stage might be as simple as sending a link to a pricing page or free trial sign-up. On the other hand, enterprise or sales-led motions often involve multiple decision-makers, procurement processes, legal reviews, and plenty of back-and-forth to tailor the solution.

The conversion here is from SAL to mutual commitment. That commitment could be a signed contract, payment, or completed order.

Defining conversion points is more complex in this stage because sales processes vary wildly depending on segment, deal size, and buyer maturity. But answering these questions is mission-critical:

• What specific actions signal a move from opportunity to commitment?
• Who signs off on the deal internally and externally?
• What qualifies as “mutual commitment” in your company?

Mutual commitment

At this point, both parties commit. You commit to delivering the promised business outcomes, and your customer commits to paying for continued access to those outcomes.

This stage doesn’t have formal subsystems, but it still plays a critical structural role in the bowtie model. It marks the pivot from acquisition to retention and expansion. 

So far, the focus has been on winning the customer. Moving forward, your goal is to build a multi-year relationship centered on value delivery and growth.

Onboarding stage subsystem

You’ve earned your customer’s trust. It’s time to start delivering on your promises as quickly as possible.

Your goal in this stage is to guide customers to their first meaningful experience—the point where your customer goes, “Wow! This works. I’m really glad I found this!”

Speed (called time-to-value or TTV in this context) is crucial here. The longer it takes your customer to experience that first outcome, the higher the risk of disengagement, second thoughts, or outright churn.

That’s why you shouldn’t think of onboarding as just a feature tour. It’s a critical conversion subsystem that may involve:

• A kickoff call with customer success
• Technical setup and integrations
• Guided product tours or help documentation

The transition from mutual commitment to first value is where customer success earns its seat at the revenue table. Make sure you track these conversions with the same rigor as your marketing-to-sales handoffs:

• Time from sale to first value
• Completion rate of onboarding milestones
• Product usage indicators that correlate with long-term retention

Adoption stage subsystems

Your attention at this stage should shift to embedding your product into customers’ daily workflows. The core objective of the adoption stage subsystems is to help customers move towards sustained, habitual use.

Successful adoption shows up in consistent and depth of usage. Your product should no longer just be an experiment. It should be infrastructure. Here are signs to look for:

• Daily logins or active usage across multiple users
• Integration into key processes or workflows
• Regular engagement with core value-driving features

Expansion stage subsystems

The final stage in the bowtie model is about growing your relationship with the customer. Expansion includes:

• Adding new users or seats
• Upgrading to higher-tier plans
• Purchasing add-ons, modules, or advanced features
• Expanding usage across departments or geographies
• Adopting adjacent products (cross-selling)

This subsystem governs the retention > growth conversion. It can be proactive (CS or sales engaging in QBRs to pitch upgrades) or reactive (customers hitting usage limits and triggering upsell opportunities). Either way, you can measure and track expansion through metrics like:

• Net revenue retention (NRR)
• Expansion MRR or expansion ARR
• Customer lifetime value (LTV)

Expansion is often where the majority of your profit comes from. You’ve already paid the customer acquisition cost (CAC), built the relationship, and delivered value. Now you’re using that foundation to drive efficient, compounding growth.

Building the data structure for your bowtie model for analysis

To turn your bowtie model into an operational system, you need a clear and structured way to track how prospects and customers flow through each subsystem. That’s where the data structure of the bowtie funnel comes into play.

This structure is based on a simple principle—every conversion subsystem has an input and an output.

These inputs and outputs are tracked using volume metrics, which tell you how many prospects, leads, or customers pass through each stage. 

Add time and velocity into the mix, and you can analyze how long it takes to generate outcomes. This helps identify bottlenecks and improve revenue growth. 

Here’s a quick overview of the three types of bowtie metrics:

• Volume metrics: Measure activity and progress with volume metrics like MQLs, SQLs, and retention rate.
• Conversion metrics: Measure the efficiency of each subsystem. Calculating MQLs that become SQLs is a good example of a conversion metric.
• Time/velocity metrics: Measure how long it takes to move from input to output. Sales velocity and TTV are good examples here.

Let’s take a closer look at how you can set up the bowtie data structure for your SaaS business:

Step 1. Define the stages and conversion subsystems in your model.

List all stages a customer moves through. Then, define the conversion subsystems between each stage. These are measurable events that signify progress.

For example, say your GTM motion includes both inbound and outbound components. You could define subsystems like:

• CR2 (MQL > SQL): A lead that has scheduled a discovery call or demo.
• CR3 (SQL > SAL): A lead that has completed a demo and fits your ICP.

Note: Take a look at the table at the end of this step-by-step guide for context.

If different teams own different parts of the process, make sure that ownership and definitions for each subsystem are crystal clear.

Step 2. Define the conversion events within each subsystem.

Define the input and output events for every subsystem (CR1 through CR7 in the table below) and align your internal definitions across marketing, sales, and CS. Conflicting definitions are one of the biggest sources of funnel leakage.

Step 3. Define benchmarks or performance goals.

Benchmarks help assess the health of your funnel. You can find benchmarks from industry data, historical company performance, or internal targets based on growth goals. These benchmarks help you determine how well a stage is performing and identify underperforming stages.

Here’s what the conversion subsystems might look like for each stage for a typical SaaS business with an inbound strategy:

Here's what your data model for tracking conversions would like like based on the above example:

The impact of the bowtie model in SaaS

Once your data structure is ready, the next step is to start using it effectively. Unlike static funnels or dashboards, the bowtie model is designed for continuous analysis and planning. That means looking at your cohorts.

Track groups of leads or customers who start their journey at the same time to understand how different segments progress through your funnel. Instead of just measuring what happened last month, you can see:

• How Q1 leads are converting compared to last year
• How many customers from two quarters ago reached First Value
• What expansion looks like for customers onboarded six months ago

Tracking these movements across each bowtie subsystem gives you full funnel visibility into performance, timing, and outcomes over time.

The bowtie model also helps you work backward from goals and plan resource allocation accordingly.

Suppose your current BDR-AR team handles 75 deals and closes five, averaging $30,000 a deal ($150,000 ARR). To hit the $450,000 quarterly target, you’ll need 15 closed deals.

That means adding two more BDR-AE teams and at least 150 more top-of-funnel leads to support them (assuming similar conversion rates).

Here’s the problem: Tracking cohorts is messy.

Tracking cohorts across CRMs, CS platforms, and marketing tools is hard, but a robust financial planning and analysis (FP&A) software like Drivetrain can help. Drivetrain unifies funnel data and makes cohort-based bowtie analysis a whole lot easier.

Drivetrain: Fast-track success with bowtie model

The success of the bowtie funnel model hinges on data and analysis. Drivetrain takes care of both.

It connects data from marketing, sales, and CS systems to build a unified view of your funnel. It tracks every conversion event and makes it easier to analyze cohorts across your bowtie, compare performance over time, and model growth scenarios by stacking cohorts and projecting outcomes.

Translation?

Instead of wasting hours on spreadsheets and siloed systems, your teams can get a clear, real-time view of what’s working, what’s not, and how to fix it—all in one place.

If you’re implementing a bowtie model, check out Drivetrain or start by comparing it with other FP&A platforms.