Growth in ARR Multiple Since the Previous Raise
Date created: Oct 12, 2022 • Last updated: Oct 12, 2022
What is Growth in ARR Multiple Since the Previous Raise?
Growth in ARR Multiple Since the Previous Raise measures how much a company’s ARR Multiple has grown since the previous round of capital funding. ARR Multiple is the ratio between ARR and a company’s valuation.
Growth in ARR Multiple Since the Previous Raise Formula
How to calculate Growth in ARR Multiple Since the Previous Raise
Based on historical data, you determine that your ARR Multiple was 5X before your raised your previous round of funding. Since then, your ARR Multiple has increased to 8X, so your ARR Multiple growth since the previous raise is 60%.
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Get PowerMetrics FreeHow to visualize Growth in ARR Multiple Since the Previous Raise?
It is best to visualize growth metrics with line charts. Use a line chart to track your growth in ARR multiple since the previous raise - perhaps adding notes indicating the details of the raise. This will let you quickly and easily see how raised capital has had an impact on your ARR multiple. Take a look at the example:
Growth in ARR Multiple Since the Previous Raise visualization example
Growth in ARR Multiple Since the Previous Raise
Line Chart
Growth in ARR Multiple Since the Previous Raise
Chart
Measuring Growth in ARR Multiple Since the Previous RaiseMore about Growth in ARR Multiple Since the Previous Raise
ARR Multiple is calculated by dividing a company’s valuation by Annual Recurring Revenue (ARR). It is used to determine the strength or influence of revenue on a company’s valuation. For this number to grow after raising funding, companies must generally grow in value as well as ARR, indicating growth in a positive direction.
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