From the mid-2000s to the late 2010s, showing a hockey-stick growth chart of Marketing Qualified Leads (MQLs) was how marketing executives proved to investors and the Board that their lead-generation engine was working.

Remember those charts?

I certainly do. Because I created and presented decks to rooms filled with suits and ties. Decks that included the most beautiful, jaw-dropping, convincing hockey stick you could ever imagine.

Because if MQLs were growing quarter over quarter, everyone believed SQLs and Closed-Won revenue would naturally follow.

Sadly, my Wayne Gretzky-approved hockey stick didn't do its job in the long run.

And it's exactly why, today, investors and Boards have stopped trusting MQL volume. Those sophisticated, EBITDA-focused capitalists started asking a different question entirely.

This especially matters if you are in a PE-backed company, a late-stage VC-backed company preparing for exit, or a publicly traded company.

These investors care about go-to-market efficiency. Not just how much revenue you're generating. But how efficiently you're generating it. And how predictably it compounds.

Figuring that out cost me a lot. Time. Money. Sleep. And the answer started with understanding what MQL was actually measuring all along.

The answer? Interest. Nothing more.

Because an MQL is someone who raised their hand and said, 'Yeah, I'd love to learn more.' They filled out a form, downloaded a whitepaper, registered for a webinar. They're curious. Maybe. But curious isn't the same as ready.

And the gap between curious and ready is exactly where revenue gets lost before it ever has a chance to compound.

Because here's what my hard-won lesson showed:

MQLs can be misleading. Lower the lead-scoring threshold and MQL volume doubles in no time, creating the illusion of enormous interest in the product. Or gate previously ungated content (a whitepaper, a calculator, a webinar) and watch MQLs flood in.

Which means revenue is not following in proportion. You can have successful campaigns (even viral) that get hundreds of leads...with zero conversions. A heart-sinking moment for everyone involved.

This is a hard pill to swallow. Because MQL became the north star for an entire generation of B2B SaaS marketers. It gave marketing a measurable output closer to revenue than raw traffic or clicks. And many marketing teams ran — and still run — an incredibly ethical, high-integrity function built around it.

The truth is, most fell into the MQL trap (like me) through convention. It's what the industry taught. And when everyone around you is measuring the same thing? It takes a certain courage to stop…and ask…is this actually moving the needle on revenue?

Because there could be a really high conversion from MQL to SQL, and it still doesn't mean prospects are ready to buy. Even with over 50% conversion from MQL to SQL, it can be weeks or months to see that deal close. If at all.

So I stopped measuring interest alone. That's just the beginning. Instead, I measured buying behaviour. The prospect's readiness to buy.

Which brings me to the metric that does exactly that: Product Qualified Leads. PQLs.

A PQL is a prospect or user who has reached a specific level of product engagement that signals they are ready — or nearly ready — to buy, upgrade, or expand.

Signing up for the self-serve product experience was them raising their hand and saying 'I'm interested.' And then they went further. They used the product to get something done. Something of real value. That's the behaviour inside the product that says: ready.

On their own terms, these prospects discover that your product is categorically better than what they're currently using. They start doing the math on what it saves their company. Time. Money. They see the transformational outcomes they can achieve. Retention. Revenue. Margin. So they build the internal business case. They become the person inside the buying committee fighting to get it approved.

And here's what's worth noting: marketing is still driving leads. Still running campaigns, building audiences, telling the product story. But instead of driving prospects to a form fill, they're driving them to a self-guided experience. One that delivers real value.

And that transforms everything.

One that produces a categorically different kind of lead. One that feeds the motion marketing always wanted to build, but couldn't, with MQL as the only signal.

And the data confirms what I've done firsthand. The industry standard for MQL conversion — not just to SQL but all the way to paid — sits at around 2-5%. The most optimistic estimates rarely exceed 10%. Now compare that to PQLs. The industry benchmark for PQL conversion to paid sits at 25-30%. Depending on your product, on your market, it can be even better. That's not a marginal improvement. That's a categorically different funnel.

Can you imagine what this can do for your business? (I'll pause here as you take a moment to calculate that…)

Here's why sophisticated investors and Boards have stopped asking about MQL volume. And started asking about PQLs instead:

PE investors are laser-focused on EBITDA, CAC payback, and NRR. They care about go-to-market efficiency beyond just top-line growth. PQL drives efficient conversion, which is far more valuable to a PE investor than MQL volume.

Companies planning an IPO or a strategic acquisition need to show efficient growth, not just growth. PQL is part of that story.

Public market investors scrutinize go-to-market efficiency metrics. ARR growth alone isn't enough. They want Rule of 40, NRR, CAC payback. PQL feeds all of these more directly than MQL ever could.

Boards grew tired of seeing marketing teams celebrate record-high MQLs while downstream revenue stagnated. Which is why institutional investors now view PQLs as a far more reliable leading indicator of pipeline health than MQL volume.

PQL is replacing MQL on executive dashboards. And for good reason.

Portia

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