ARR roll-forward
Opening, new, expansion, churn, closing.
By Surojit Chakraverti, founder of L3VLUP and an investor running a long-short healthcare and technology equities strategy.
On this subject: arr roll-forward.Updated 30 September 2026
What it does
The stock that a subscription business is measured on, moved by three flows on the opening balance: new ARR from the sales force, expansion from existing customers, churn out of the base. Every quarter’s closing is the next quarter’s opening, net new ARR is the movement, and the customer count rolls beside it so ARR per customer can be read. Revenue and every retention metric are derived from this sheet.
Where it lives
The same schedule in each model that carries it, with the rows to open. Open a model in the browser, go to the sheet, and click the lines.
- Assumptions, rows 6–9: Annual recurring revenue at the start, Customers at the start, Deferred revenue at the start, Productive account executives at the start
- Assumptions, rows 21–23: Gross ARR churn per quarter, share of opening ARR, Expansion per quarter, share of opening ARR, Customer (logo) churn per quarter
- ARR Build, rows 6–14: Opening ARR, New, Expansion, Churn…
- ARR Build, rows 17–21: Opening customers, New, Lost, Closing customers…
What a reviewer looks for
- Churn and expansion applied to closing ARR.
- Expansion netted against churn, which hides gross retention.
- ARR quoted as revenue.
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