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The definition of ARR seems to have become a point of friction between startups and VCs over the past couple of years. ARR originally stood for “Annual Recurring Revenue,” which had a rather strict definition of only looking at recurring contracts with a service length of one year or more (and discarding everything else) ARR is a helpful metric if your business makes the vast majority of its revenues from annual or multi-year contracts. For many modern SaaS companies this isn’t a very relevant metric if the majority of revenues are from monthly contracts.