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  4. Arr

ARR (Annual Recurring Revenue)

Annualized recurring revenue from subscriptions.

Why it matters

Standardizes revenue for annual comparisons and valuation. Derived from MRR.

Benchmarks

Use ARR milestones to frame stage: Pre‑seed <$500k; Seed ~$500k–$1.5M; A ~$1.5M–$5M (varies).

Worked example

MRR $120k → ARR = 120k×12 = $1.44M.

Common pitfalls

Including non‑recurring revenue; using bookings instead of live MRR; double‑counting usage spikes.

How to show in your deck

Headline ARR number with YoY growth %; add logo list for credibility.

Deck snippet

ARR $1.44M (+120% YoY).

Formulas

ARR
MRR x 12

FAQs

Related

MRRSeeGross marginSee