07/10/2026
An AI startup says its ARR is $2 million. Our angel is ready to wire the money. So we looked inside the number first.
ARR should mean signed, recurring subscriptions. Unsigned deals, token usage, hardware and one great month times twelve don't count the same way.
One startup made about $100k a month, then had one $170k month. Multiply that month by twelve and you get $2 million. Annualise the last six months instead and it's $1.3 million.
Three questions before you wire anything:
Is it signed?
Which month is that?
After the model bill, what's left?