Average Contract Value
Also: ACV
The average annualised value of a customer contract, a measure of how much each deal is typically worth.
Why it matters
ACV indicates the typical size of your deals, which shapes the sales motion you can afford, low-touch self-serve versus high-touch enterprise sales. It informs how much you can spend to acquire and how to structure the team. Rising ACV often signals a move up-market.
How it is calculated
ACV = total annualised contract value / number of contracts (excluding one-time fees)
What good looks like
ACV is most useful for matching motion to economics: a small ACV cannot support an expensive sales process, a large one can. Track it by segment, a blended ACV across very different deal sizes hides the real picture.
Related terms
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