I remember as an operator I was struggling to understand why growth as venture-backed startup became an existential need. As a founder, I was always laser-focused on finding product market fit, retaining customers, and refining my understanding of the ideal customer profile. When we took on capital, there was at first a subtle shift to hitting ARR milestones and celebrating, but eventually ARR became the one and only goal. Now that I sit on the VC side, I reflect on this shift that I went through as a founder.
Previously, we emphasized that quality of growth (and not just raw numbers) is what truly matters for your business. However, ARR (Annual Recurring Revenue) remains the #1 metric VCs use to evaluate company growth. What’s driving VC fixation with ARR, and what does this mean for your startup?
In this episode of Deepdive, we'll discuss why is ARR is so crucial, a VC's investment and the return economics, and how to balance revenue growth with retention for sustainable success.
https://lnkd.in/gMhxWjqr
Building Innovative Maritime Trade Product | Founder @Smacoteq | Web3 Advocate | RWA Tokenization - DeFi | Sustainability | UAV | AI | International Business Professional |
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