ARR is the annualized value of your recurring subscription revenue — the north star metric for SaaS businesses. It normalizes monthly contracts to an annual view, making it easier to track growth rate, burn multiple, and company value. ARR growth rate is what investors care about most at early stage. A business growing ARR at 3x YoY with healthy NRR is fundable at almost any stage.
For example, if you have 50 customers paying $2,000/month, your MRR is $100K and your ARR is $1.2M — but if 5 of those customers just upgraded to $3,000/month, your run-rate ARR is already $1.35M.
ARR is the ultimate measure of our work — we track how our demand gen and sales programs contribute to net new ARR for every client.
Relevant Cactus Services
We implement Annual Recurring Revenue (ARR) strategies for B2B tech startups every day. Book a free 30-minute call to get a concrete plan for your situation.
Book a free strategy call →Ideal Customer Profile (ICP)
Your ICP is the precise description of the company most likely to buy, stay, and expand.
Sales Development Representative (SDR)
An SDR is the outbound hunter on your sales team — their job is to generate qualified meetings, not close deals.
Business Development Representative (BDR)
A BDR is similar to an SDR but often focuses on larger, more strategic accounts or outbound into new markets rather than a defined territory.
Total Addressable Market (TAM)
TAM is the total revenue opportunity if you captured 100% of your target market.
Serviceable Addressable Market (SAM)
SAM is the portion of TAM you can actually reach with your current GTM motion.
Serviceable Obtainable Market (SOM)
SOM is the slice of SAM you can realistically capture in the next 12–24 months given your resources, competition, and execution capacity.