ARR Calculator
Annual recurring revenue projection.
Calculate current ARR and forecast future ARR from current MRR and monthly growth rate. Enter months forward and see the result instantly.
What this tool does
This tool calculates current ARR and projects future ARR based on current MRR, monthly growth rate, and months forward.
Enter Values
Formula Used
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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 and monthly growth of 10% (plus months forward of 12 months), the result is 600,000.00. Change any figure and watch the output 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. Not every input has equal weight. Flip one at a time toward extreme values to feel which ones move the needle most for your situation.
What's happening under the hood
Current ARR = MRR × 12. Future MRR = MRR × (1 + growth)^months. Future ARR = future MRR × 12. The formula is listed in full below. If the number looks off, you can retrace the calculation by hand — that's the point of showing the working.
What to do with a low result
A disappointing result is information, not a judgement. Pick the single input that dragged the figure down most and focus the next quarter on that one factor. Breadth-first improvement rarely works; depth-first on the worst input usually does.
What this doesn't capture
The score is a composite of the inputs you provide. Life context — job security, family obligations, health, housing — doesn't appear in the math but shapes the real picture. Use the number as a prompt, not a verdict.
£50,000 £ MRR × 12 = current ARR. Grown at 10%/mo for 12mo = $600,000.00.
Inputs
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
Current ARR = MRR × 12. Future MRR = MRR × (1 + growth)^months. Future ARR = future MRR × 12.
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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