Business Metrics
MRR/ARR (Monthly/Annual Recurring Revenue)
The predictable, recurring revenue a subscription business generates monthly (MRR) or annually (ARR). Excludes one-time fees and variable charges.
Biological Context
Recurring revenue parallels stable energy intake—the reliable resource flow that sustains an organism. Just as organisms prefer predictable food sources over variable ones, businesses value recurring revenue for its predictability. MRR growth rate indicates organizational health.
Business Application
ARR is the primary valuation metric for SaaS companies. ARR multiples determine company value; ARR growth rate determines those multiples. Net revenue retention (including expansion) can exceed 100%, indicating growth without new customer acquisition.