How to calculate the SDR cost of running a PLG motion manually

Before you can build a compelling business case for agent-led growth, you need to know what you're replacing. That means knowing what it actually costs — in dollars, in time, and in coverage — to run your PLG edge motions with humans.

Most companies dramatically underestimate this number. Here's how to calculate it properly.

Step 1: Define the motions you're running

Start by listing the specific outreach motions your team runs for PLG accounts. These typically include some combination of:

• Dormant free user re-engagement
• Trial activation nudge (for trials that aren't progressing)
• Free-to-paid conversion outreach (for activated users who haven't upgraded)
• Expansion outreach (for accounts with room to grow)
• Churned trial win-back
• Champion departure follow-up

For each motion, note: who runs it (SDR, CSM, growth engineer), how often, and roughly how many accounts they're reaching.

Step 2: Calculate the fully loaded cost per SDR

This is where most companies undersell their actual cost. The fully loaded cost of an SDR is not just their base salary. It includes:

• Base salary: $55,000–$75,000 for a mid-market PLG SDR
• Variable comp (OTE): typically 25-40% on top of base
• Benefits and payroll taxes: 20-25% of total comp
• Tech stack per seat: Outreach/Salesloft ($150/mo), LinkedIn Sales Nav ($100/mo), data enrichment ($100/mo) = ~$4,200/year
• Manager overhead: assume a 1:8 manager-to-SDR ratio, allocate 12.5% of a manager's fully loaded cost
• Recruiting and onboarding: amortize a $15,000–$25,000 recruiting cost over 18 months (average SDR tenure)
• Training and ramp: 3-month ramp period where the SDR is at 50% capacity

When you add all of this up, the fully loaded annual cost of a PLG SDR is typically $110,000–$160,000. Let's call it $130,000 for a baseline.

Step 3: Calculate the capacity ceiling

Now calculate how many accounts each SDR can actually reach per month at a quality level that matters. "Quality" here means: personalized enough that someone would actually respond, not mass spam.

A typical PLG SDR running edge motions can handle:

• ~30-45 minutes per account per month (research, writing, follow-up)
• ~160 productive hours per month (accounting for meetings, training, admin)
• ≈ 250–320 accounts per month at quality level

Call it 300 accounts per month per SDR.

Step 4: Calculate the cost per account touched

With a $130,000 annual cost and a capacity of 300 accounts per month (3,600 per year):

• Cost per account touched: $130,000 / 3,600 = $36 per account

Now compare that to your free user base. If you have 50,000 free users and you're only reaching 3,600 per year with manual outreach, you're touching 7.2% of your addressable universe. The other 92.8% are getting nothing.

Step 5: Calculate the conversion opportunity cost

This is the number that changes the conversation.

Let's say your product's average conversion rate from activated free user to paid is 8% with no outreach. With a well-timed, personalized human outreach, you can get that to 14-18% — let's call it 15%. That's roughly a 7-point lift.

Now apply that to your untouched universe. If you have 46,400 activated free users who aren't being reached:

• Without outreach: 46,400 × 8% = 3,712 conversions
• With ALG outreach: 46,400 × 15% = 6,960 conversions
• Incremental conversions: 3,248
• At $100/month average plan: $324,800/month in incremental MRR

That's the opportunity cost of only reaching 7% of your universe.

Step 6: Build the ALG comparison

Now compare the ALG approach:

• ALG Scale plan: $799/month
• Coverage: all 50,000 free users, every motion, every time
• Incremental conversions: larger than the SDR approach because you're reaching 100% of the universe

The comparison isn't "agents vs SDRs." It's "agents reaching everyone vs SDRs reaching 7%." When you frame it that way, the ROI conversation changes entirely.

The formula

Here's the simplified formula to use in your business case:

• SDR edge motion cost per year: (# of SDRs dedicated to PLG motions) × $130,000
• Accounts reached per year: (# of SDRs) × 3,600
• Coverage rate: accounts reached / total addressable free user base
• Unreached opportunity: (total free users − accounts reached) × (conversion rate with outreach − conversion rate without) × ACV
• ALG cost: $799/month = $9,588/year
• ALG ROI: incremental MRR from full coverage − ALG cost

The business case for ALG isn't "we can do this cheaper." It's "we can do this for everyone, not just 7% of them — and the difference is worth more than any SDR headcount you could add."