ARR Calculator
Annual recurring revenue projection.
Calculate current ARR and forecast future ARR using your MRR and monthly growth rate over a 12 to 24 month projection horizon.
What this tool does
# Expanded Description (120 words) This calculator takes your current monthly recurring revenue and projects it forward based on a consistent monthly growth rate. It shows both your annualised recurring revenue today (calculated by multiplying current monthly revenue by 12) and what that figure could reach at your chosen time horizon. The result is driven primarily by your starting monthly revenue and the growth rate you enter—even small differences in monthly growth compound significantly over time. A typical scenario might involve a subscription business modelling revenue trends over 12 or 24 months to understand scaling potential. The calculation assumes your growth rate remains constant throughout the period and that no other factors change. It does not account for seasonality, churn, pricing changes, or market conditions. The projection is illustrative and represents one possible path based on your inputs.
Quick answer: with the default values, the result is $600,000.00 (Current ARR). Adjust the values below for your own figures.
Enter Values
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Formula Used
Disclaimer
Results are estimates for educational purposes only. They do not constitute financial advice. Consult a qualified professional before making financial decisions.
ARR (Annual Recurring Revenue) is MRR multiplied by 12, with a forecast forward adding growth. It's the headline metric for subscription businesses because it projects annualised revenue assuming current book stays put. VCs, analysts, and acquirers all quote SaaS businesses in ARR terms.
50k MRR today = 600k ARR. At 10% monthly growth (aggressive but seen in early-stage SaaS), MRR becomes 157k in 12 months, an ARR of 1.88M. That's over 3x growth in a year - typical of Seed-to-Series A velocity, unsustainable beyond that stage.
ARR has drawbacks. It excludes one-time revenue (setup fees, professional services), which can understate short-term cash. It assumes no churn, which is always wrong. 'Contracted ARR' (signed contracts minus known churn) is a more defensible number for valuation, though it requires contract visibility public companies rarely share.
Quick example
With current MRR of 50,000, the primary result is current ARR — 600,000.00, or 50,000 × 12. The 10% monthly growth and 12-month horizon don't change that figure; they drive the forward projection shown just below it, ARR in 12mo of 1,883,057.03. Change any figure and watch the outputs shift — it's often more useful to see the pattern than to memorise the formula.
Which inputs matter most
You enter Current MRR, Monthly Growth %, and Months Forward.
What's happening under the hood
Current ARR = MRR × 12. Future MRR = MRR × (1 + growth)^months. Future ARR = future MRR × 12.
£50,000 MRR × 12 = $600,000.00 current ARR. The 12mo projection at 10%/mo growth appears separately as ARR in 12mo.
Inputs
| ARR in 12mo | $1,883,057.03 |
|---|---|
| ARR Added | $1,283,057.03 |
| Current MRR | $50,000.00 |
| Future MRR | $156,921.42 |
This example uses typical values for illustration. Adjust the inputs above to match a specific situation and see how the result changes.
Sources & Methodology
Methodology
This calculator computes annual recurring revenue by taking monthly recurring revenue and projecting it forward. It applies the compound growth formula, where future MRR equals current MRR multiplied by (1 plus the monthly growth rate) raised to the number of months specified. Annual recurring revenue is then derived by multiplying the resulting MRR by 12. The model assumes a constant monthly growth rate applied uniformly across all periods, with no variation or interruption. It does not account for seasonality, customer churn, pricing changes, fees, or the timing of revenue recognition. Results represent a theoretical projection under steady-state growth conditions.
References
Frequently Asked Questions
Does ARR include one-time fees?
ARR vs revenue?
What's a healthy ARR growth rate?
Why do VCs focus on ARR?
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