GTM misreporting is a risk your company can't afford to take | MarTech

"Every quarter, GTM spending gets tucked into operating expenses on the P&L. But economically, it's a fiction. GTM doesn't behave like OpEx. It behaves like CapEx. It is front-loaded, risky, and deployed with the expectation of multi-period returns. And when it fails, it doesn't simply vanish - it leaves behind stranded, impaired capital. That is one of the reasons why GAAP rules around the treatment of GTM expense may soon change."

"Think about how you treat building a factory. It's recorded as CapEx, depreciated and tracked against its expected return. Everyone recognizes it as a capital allocation decision with consequences. GTM works the same way. The commissions, campaigns, events, enablement programs and onboarding all hit before a single dollar of customer revenue arrives. Repayment comes later, through renewals, expansions and margin flow across years. When churn cuts that cycle short, the capital is stranded - no different from a shuttered plant."

Go-to-market spending is currently recorded as operating expense but functions economically as capital expenditure because it is front-loaded, risky, and intended to generate returns over multiple periods. Customer acquisition cost (CAC) creates a liability tied to future customer cash flows; successful customer revenue services that obligation, while failure strands capital and transfers losses to shareholders. Changing GAAP treatment aims to reflect GTM as a capital allocation decision with tracked depreciation and impairment. CEOs and CFOs must recognize governance and fiduciary implications, as treating GTM as OpEx masks debt-like risks and can lead to impaired shareholder capital.

Read at MarTech