Segment Concentration Calculator

What is Segment Concentration?

Segment concentration measures what share of total revenue comes from the single largest named segment, and computes an HHI to summarize how evenly revenue is spread across all segments. GTM diagnostics use it to test whether ICP focus has become revenue dependency.

Formula

Version v1. See methodology and the public formula repo for sources and change history.

Worked example

Using the default example inputs (Segment 1 revenue: $500,000; Segment 2 revenue: $300,000; Segment 3 revenue: $150,000; Segment 4 revenue: $80,000; Segment 5 revenue: $70,000), Segment Concentration equals 45% (Top-segment share). Concentration is distributed. Track whether the largest segment is growing or ceding share each quarter.

What good looks like

Most mature B2B SaaS companies target a top-segment share below 50 to 60% so that a single-segment shock does not cascade into a funding or hiring crisis. Track whether the top segment's share is growing or shrinking quarter over quarter.

Directional guidance only, not a cohort benchmark claim. Premium cohort bands appear when sample thresholds are met for your profile.

FAQ

What is Segment Concentration?

Segment concentration measures what share of total revenue comes from the single largest named segment, and computes an HHI to summarize how evenly revenue is spread across all segments. GTM diagnostics use it to test whether ICP focus has become revenue dependency.

What is the Segment Concentration formula?

Top-segment share = largest segment revenue / total revenue × 100; HHI = sum of (segment share)² across all segments

What is HHI?

The Herfindahl-Hirschman Index is the sum of each segment's share squared. Higher values (approaching 10,000) indicate extreme concentration; values below 1,500 suggest a moderately diversified portfolio.

How should I define segments?

Use the same segment taxonomy your sales and customer success teams use today: industry vertical, company size band, or product line. Consistency matters more than the taxonomy itself.

Is top-segment concentration the same as customer concentration?

No. Customer concentration tracks dependence on specific accounts; segment concentration tracks dependence on a category of buyers. Both matter and both should be reported.