Bottoms-Up Forecast

A bottoms-up forecast builds the revenue prediction from individual deals. Instead of "we'll grow 20% this quarter" (top-down guess), you start with "here are 47 deals, here's each one's probability, here's the math." The forecast is only as accurate as your deal-level assessments.

The principle: every forecast is a probability-weighted sum. The quality depends on two things: accurate deal amounts and honest probability assessments. Most teams get the amounts right and the probabilities wrong. Fix the probabilities and the forecast fixes itself.

The Forecast Formula

Basic weighted forecast

Forecast = Sum of (Deal Amount × Close Probability)

Example:
  Deal A: $50K × 80% = $40K
  Deal B: $30K × 50% = $15K
  Deal C: $25K × 30% = $7.5K
  Deal D: $40K × 20% = $8K