SaaS Metrics School

Common ARR Disclosure Mistakes And How to Avoid Them

Listen Later

In episode #346 of SaaS Metrics School, Ben Murray breaks down the most common mistakes SaaS and AI companies make when disclosing their ARR (Annual Recurring Revenue). Building on the prior episode about the five questions every ARR definition must answer, this discussion focuses on where ARR disclosures go wrong—and why unclear definitions can damage credibility with investors, boards, and acquirers.

Drawing from extensive research on public tech company filings and press releases, Ben explains how vague ARR definitions, hidden mechanics, and inconsistent methodologies create confusion and risk during fundraising, valuation discussions, and due diligence.

Resources Mentioned

  • Prior episode: The 5 Questions Your ARR Definition Must Answer
  • SaaS Metrics Course: https://www.thesaasacademy.com/the-saas-metrics-foundation
  • Blog post on ARR: https://www.thesaascfo.com/cfos-guide-to-disclosing-headline-arr-number

    • What You’ll Learn

    • Why a company’s pricing model does not always match its ARR model
    • The importance of clearly defining which revenue streams are included in ARR
    • Common issues with vague annualization periods (monthly vs. quarterly vs. trailing periods)
    • How poor disclosure of usage-based or variable revenue creates misleading ARR numbers
    • Why ARR definition changes and restatements require clear explanation and transparency

      • Why It Matters

      • Clear ARR disclosure builds trust with investors, boards, and business leaders
      • Poorly defined ARR can undermine company valuation and fundraising conversations
      • Inconsistent ARR definitions make benchmarking and financial modeling unreliable
      • Transparent ARR mechanics reduce follow-up questions during due diligence
      • Strong financial strategy starts with defensible, repeatable revenue metrics

        •  

        ...more
        View all episodesView all episodes
        Download on the App Store
        SaaS Metrics SchoolBy Ben Murray
        • 4.6
        • 4.6
        • 4.6
        • 4.6
        • 4.6

        4.6

        11 ratings

        More shows like SaaS Metrics School

        View all
        The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch by Harry Stebbings

        The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch

        539 Listeners

        The Official SaaStr Podcast: SaaS | Founders | Investors by SaaStr

        The Official SaaStr Podcast: SaaS | Founders | Investors

        182 Listeners

        Invest Like the Best with Patrick O'Shaughnessy by Colossus | Investing & Business Podcasts

        Invest Like the Best with Patrick O'Shaughnessy

        2,341 Listeners

        Founders by David Senra

        Founders

        2,194 Listeners

        Equity by TechCrunch, Rebecca Bellan, Kirsten Korosec, Anthony Ha, Max Zeff, Theresa Loconsolo

        Equity

        342 Listeners

        All-In with Chamath, Jason, Sacks & Friedberg by All-In Podcast, LLC

        All-In with Chamath, Jason, Sacks & Friedberg

        10,239 Listeners

        The Bible in a Year (with Fr. Mike Schmitz) by Ascension

        The Bible in a Year (with Fr. Mike Schmitz)

        62,624 Listeners

        Business Breakdowns by Colossus | Investing & Business Podcasts

        Business Breakdowns

        357 Listeners

        AI + a16z by a16z

        AI + a16z

        34 Listeners

        The SaaS CFO by Ben Murray

        The SaaS CFO

        3 Listeners