Annual Recurring Revenue (ARR) is the amount of predictable revenue your company expects to make each year from subscriptions or long-term contracts. It’s a core metric for SaaS and other recurring revenue businesses because it helps you track growth, plan budgets, and forecast more reliably.

ARR only includes the recurring part of your income, not one-off payments like onboarding or setup fees.

Example:

If you have 100 customers paying €2,000 per year, your ARR is €200,000.

If one of them upgrades to a higher tier and starts paying €3,000 annually, your ARR increases to €201,000.

It’s a simple number with big impact. Investors love it because it reflects the health and momentum of your business.

Other terms

Anchor Text Strategy

Anchor Text Strategy involves choosing the right clickable words in a hyperlink to improve SEO and keyword relevance.

Answer Engine Optimization (AEO)

Answer Engine Optimization (AEO) prepares your content for visibility in AI-generated responses and rich snippets across search engines.

Annual Contract Value (ACV)

Annual Contract Value (ACV) measures the average yearly revenue from a subscription, helping SaaS teams understand account value over time.

Always-On Marketing

Always-On Marketing is a continuous, multichannel approach that ensures your brand is present whenever potential buyers are ready to engage.

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