Average deal size is the mean value of the deals you close in a given period, usually calculated as total closed-won revenue divided by the number of won deals. It is one of the inputs to sales velocity and a core part of how pipeline is valued and forecast is built. A high average deal size can make up for fewer deals; a low one means you need volume.
In plain English
Average deal size is the size of the fish you catch. Some reps catch a few big ones, some catch many small ones. Knowing the average tells you how many deals you need in your pipeline to hit your quota — and it is the multiplier in velocity.
Why it matters to you
Your pipeline must be roughly your deal size times your win rate times how many deals you need. If the average deal size is small, you need a lot of proposals and activity; if it is large, you need fewer, better-qualified deals. Asking about the average deal size in an interview tells you whether the role rewards activity or closing fewer, bigger deals.