Build and Exit
104 weeks · 3 milestones
Build a product to a point of acquisition and complete a successful exit.
Milestone map
Milestone map
3 milestones
Reach $500,000 in Annual Recurring Revenue (ARR) — the threshold that makes a software or services business acquirable by most strategic and financial buyers. ARR is not total revenue; it is the annualised value of your current recurring contracts or subscriptions. For a SaaS business, $500k ARR equals approximately $41,700 in Monthly Recurring Revenue (MRR). For a services business with annual contracts, it is the sum of all active annual contract values. The business must have demonstrated revenue retention — meaning existing customers are not churning faster than new customers are joining. Proof is a financial record showing the ARR figure: a Stripe MRR dashboard screenshot with the annualised calculation, a subscription billing export, or a P&L report from accounting software. Include a retention cohort or a churn rate figure alongside the ARR to confirm the revenue is stable.
Proof required
Submit: (1) a financial record showing $500,000+ ARR — a Stripe MRR screenshot, subscription billing export, or P&L report with the annualised calculation shown — and (2) a churn or retention figure covering the most recent 6 months (monthly churn rate, net revenue retention %, or a cohort chart showing customer survival). Include a 100-word note on how ARR was calculated and what the primary revenue driver is.
What gets checked
- ARR figure is calculated and labelled correctly — a Stripe screenshot showing $41,700 MRR with a note 'MRR × 12 = $500,400 ARR' passes; a screenshot showing 'total revenue this year' without distinguishing recurring from non-recurring does not; revenue from one-time services or project work is not ARR even if it is large
- Retention data accompanies the ARR figure — ARR without retention data cannot be evaluated by an acquirer; a monthly churn rate above 5% or a net revenue retention below 90% is a signal that the $500k ARR will not sustain; include this data honestly even if the numbers are imperfect
- Revenue is from real customers, not related parties — a business where 80%+ of ARR comes from companies connected to the founder, investors, or advisors is not independently validated at $500k ARR; describe the customer base briefly (number of customers, average contract value, industry) to contextualise the ARR figure
Resources
Enroll free to unlock learning resources →Mastery
Firstbase.io — SaaS Financial Metrics
Free — understanding how acquirers read ARR, churn, and net revenue retention before reaching the $500k milestone means the business is being built to be acquirable from the start, not retroactively formatted for diligence
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