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Hey {{first_name}} 👋, hope you had a great week! In the last issue, we discussed why tracking ACV matters, and now we are moving with the next topic from Financial Metrics content.

Let’s talk about ⬇️

Most SaaS founders think ARR is just a scoreboard.

A vanity metric.
Something investors ask for.
A number you paste into a pitch deck and move on.

But after working with SaaS companies across multiple stages, I can tell you:

ARR is one of the most misunderstood…and underused…metrics in SaaS.

In reality, you only need 5 lenses to turn ARR from “just a number” into a strategic weapon.

Let’s break it down. 👇

1️⃣ ARR is about predictability…not growth hype

2️⃣ ARR is NOT just “annualized MRR”

3️⃣ ARR tells you why revenue is moving

4️⃣ ARR is a hiring & runway signal

5️⃣ ARR needs context (or it lies)

The goal of ARR is simple:
Show how much recurring revenue your business can reliably generate over the next 12 months.

That’s why investors love it.

ARR strips away:

And focuses purely on repeatable, contractual revenue.

If your ARR is growing steadily, it signals:

That’s real momentum.

I'm Aleksandar, fractional CFO at Fiscallion, where we help founders like you achieve financial clarity, streamline reporting, and build investor-ready forecasts.

Ready to level up your finances?

Yes, they often align.

But they’re not the same.

ARR requires nuance:

That’s why ARR can be lower than annualized MRR—and that’s not a bug. It’s honesty.

Inflated ARR = false confidence.

Smart teams don’t just track ARR.

They decompose it into:

This is where strategy lives.

If ARR grows but expansion is zero → your product isn’t deep enough.
If ARR stalls despite strong sales → churn is leaking value.
If expansion drives growth → you’ve found leverage.

ARR isn’t just for investors.

Finance uses it to answer:

ARR growth extends runway.
Stagnant ARR shortens it…no matter how busy sales feels.

This is why ARR belongs in headcount planning, not just board decks.

ARR alone doesn’t tell you:

ARR is powerful…but only in combination.

Think of it as the backbone, not the whole skeleton.

ARR gives you the big picture:

But the real magic happens when you stop reporting ARR…
and start using it to make decisions.

If you want help getting ARR (and the metrics around it) actually right:

Just hit reply—I read every message.

Chat soon,

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