ARR calculator for B2B SaaS
This free ARR calculator estimates the new annual recurring revenue (ARR) a B2B SaaS could add from qualified demos. Enter demos per month, average contract value and your demo-to-close rate. New ARR = demos per month x 12 x close rate x average contract value.
Last updated
ARR calculator
How much ARR could you be adding?
Move the sliders to model your pipeline. It's the same math we run on day one of every engagement.
YOUR INPUTS
NEW ARR YOU COULD ADD
$2,366,000
per year
New customers / yr
91
Pipeline created
$12.48M
An estimate built from your own inputs. Your results depend on your product, market and sales team.
How does the ARR calculator work?
New ARR = qualified demos per month x 12 x demo-to-close rate x average contract value. Pipeline created = demos per month x 12 x average contract value.
Example: 20 demos a month is 240 a year. At a 20% close rate that is 48 new customers. At a $20,000 average contract value, that is $960,000 in new ARR from $4.8M of pipeline.
What do the three inputs mean?
- Qualified demos per month: booked calls with buyers who fit your ideal customer, not every booking.
- Average contract value: the yearly recurring value of a typical new customer.
- Demo-to-close rate: the share of demos that become paying customers. Use your own recent numbers.
Frequently asked questions
What is ARR?
ARR is annual recurring revenue: the yearly value of your active subscriptions and contracts. New ARR is the part added by customers who signed in a given period.
How do I calculate new ARR from demos?
Multiply your qualified demos per month by 12, then by your demo-to-close rate, then by your average contract value. For example, 20 demos a month at a 20% close rate and a $20,000 contract value gives 48 new customers and $960,000 in new ARR a year.
How many demos do I need to add $1M in new ARR?
Divide your target by 12 x close rate x contract value. At a 20% close rate and a $25,000 contract value, $1,000,000 / (12 x 0.20 x $25,000) is about 17 qualified demos a month.
What is a good demo-to-close rate?
It varies a lot with price, product and sales process, so there is no single number to aim for. Use your own close rate from the last 3 to 6 months of demos, and test a lower rate to see how sensitive the result is.
What does the calculator leave out?
It does not include churn, the time between a demo and a signed deal, expansion revenue or ad costs. Treat the result as a planning estimate built from your own inputs, not a forecast.
Want more demos to put in the calculator?
Read how to get more demos for a B2B SaaS, or see how our SaaS PPC agency service and other services work.