Thread by @Baremetrics

How long does it take to get to $10K ARR? How about $100K ARR? Or even better, $1M! We analyzed nearly 1,000 SaaS companies to get some benchmarks. Here's what we found!

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An annual run rate of $10,000 means about $833 in MRR. That may not sound like much, but getting to that first $10k in ARR is quite a trek!

Once you pass that first hurdle, subsequent $10,000 milestones are reached at a much faster pace. But even then, many companies never get out of the “multiples of $10k ARR” realm as it can be demoralizing to keep pushing for that long.

On average, a year in, most SaaS companies are only doing $40,000 ARR (or, about $3,333 in MRR). That’s not enough to sustain a single person, let alone a team and it’s why so many SaaS tools never really get off the ground and become something bigger.

Here’s where things start to get slightly more interesting. At $100,000 ARR, you're likely at a point where at the very least you're working on it full-time, and could probably have another employee or co-founder and maybe even some part-timers.

But, as was the case with the $10k ARR milestones, the first $100k ARR is long and difficult. After that? Things speed up quite a bit. Most companies double their ARR from $100k to $200k in a third of the time!

The $100k to $200k journey really highlights why SaaS can be a great business model. The compounding effects of customers continuing to pay you on a recurring basis makes growth much more stable.

$1M in annual recurring revenue! The holy grail! 😛 For many, hitting $1M ARR feels unachievable. It takes the average company nearly two years to get there, and that’s if they even survive that long.

The takeaway? Patience! Going from one milestone to the next isn't easy, and it doesn't happen overnight. But the beauty of SaaS is revenue compounds. As you hit new milestones, you have more resources to hit the next.