Founders

ARR became a meaningless concept during the AI hype cycle. 

I’m seeing a growing number of companies reporting “ARR” and have revenue that is not recurring at all. 

One example are the professional AI headshots. You pay now and probably won’t need to pay again in the next 5 yrs. But the companies report “ARR” as if the revenue they’re making is recurring annually.

Not to mention all the other B2B AI with short term contracts or no contract at all. One competitor away from losing that recurrence — and it’s already happening.

Run rate is the correct term for most.

Run rate is indeed more accurate in many cases.