How to describe your business as an equation
Lenny Rachitsky
JANUARY 16, 2024
ARR = New ARR + Expansion ARR + Reactivation ARR – Churned ARR – Contraction ARR New ARR = New seats * price per seat New seats = Visitors * conversion to trial/freemium * conversion to paid * seats per account Visitors Paid ads SEO Direct (e.g. word of mouth, virality) Referral (e.g. WOM, virality) Referral (e.g.
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