Turn your ARR, growth rate and net revenue retention into an implied revenue multiple, a base valuation and a defensible range — using how private SaaS is actually priced in 2026.
Annual recurring revenue today.
Year-over-year ARR growth rate.
Revenue kept and grown from existing customers.
Optional. Defaults to 75% if left blank.
Indicative ranges for private SaaS by growth band, observed across the wider market at average retention. These are external reference ranges, not this tool's output — your own multiple above reflects your specific NRR and margin and can land higher or lower than the band for your growth rate. Your growth band is highlighted for context.
| Growth Band | Market ARR Multiple | What It Means |
|---|
slow growth or leaky retention
steady, durable SaaS
fast growth, strong NRR
top-decile growth & retention
Private SaaS is valued on a revenue multiple, not profit. You take ARR and multiply it by a number that reflects how attractive the business is to a buyer or investor. Most companies land somewhere between 3x and 8x ARR, with the exact multiple set almost entirely by growth and net revenue retention.
Growth and NRR dominate because recurring revenue compounds — a fast-growing base that expands on its own is worth a premium. Gross margin and market conditions adjust at the edges. Only elite outliers, combining high growth with best-in-class retention, push into double-digit multiples.
Multiple = 2.5 + Growth%×0.12 + (NRR−100)×0.08 + (Margin−75)×0.03 The multiple is clamped to a floor of 1.5x and a ceiling of 20x, then:
Valuation = ARR × Multiple Example: $4M ARR, 40% growth, 110% NRR, 75% margin:
A revenue multiple is really a bet on where ARR lands in a few years. Fast growth means today's $4M becomes tomorrow's $10M, so buyers pay up front for that trajectory. Each point of growth lifts the multiple more than any amount of profit at the same scale.
Net revenue retention above 100% means the existing base grows without new acquisition — the cheapest, stickiest revenue there is. Buyers reward it with a higher multiple; a sub-100% NRR signals a leaky bucket and drags the valuation down even when headline growth looks healthy.
The most common approach is a revenue multiple: you take Annual Recurring Revenue (ARR) and multiply it by a number that reflects how attractive the business is. That multiple is driven mostly by growth rate and net revenue retention, with gross margin and market conditions adjusting it at the edges. A SaaS company growing 40% with 120% NRR commands a far higher multiple than a flat business with leaky retention, even at identical ARR.
Most private SaaS businesses trade in a band of roughly 3x to 8x ARR. Slow-growing or sub-scale companies sit near the floor (1.5x–3x), steady growers land around the median (4x–6x), and fast-growing companies with strong retention reach the top of the range. Only elite outliers — high growth combined with best-in-class NRR — push into double-digit multiples.
Recurring revenue compounds. A company growing 50% a year with 120% net revenue retention will be several times larger in a few years without acquiring a single new logo on top of its base. Buyers and investors price that future, not just today's profit. Two companies with identical ARR and margin can be worth wildly different amounts purely because one is growing and retaining while the other is flat and churning.
Net revenue retention (NRR) measures how much recurring revenue you keep and grow from existing customers, after expansion, contraction and churn. Above 100% means your base grows on its own. Because that expansion is cheap, durable revenue, every point above 100% lifts the multiple, and every point below 100% drags it down — a sub-100% NRR signals a leaky bucket that buyers discount heavily.
The multiple is the lever; the valuation is ARR times that lever. A 5x multiple on $4M ARR is a $20M base valuation. Real transactions land in a range around that base — this tool shows a low–high band of roughly ±30% — because diligence, deal structure, comparable transactions and market timing all nudge the final number up or down.
Yes, but less than growth and retention. Healthy SaaS runs 75–85% gross margin, and that's roughly the assumed baseline. Margins well above that signal efficient delivery and lift the multiple slightly; margins well below it suggest heavy services or infrastructure costs that aren't truly software-like, which compresses the multiple. It's a secondary adjustment, not the main driver.
A defensible valuation starts with clean, real-time numbers. Mowt tracks your ARR, growth rate and net revenue retention straight from Stripe, so the metrics that set your multiple are always investor-ready.
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