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ARR bridge and efficiency of a SaaS company in Chennai
The prompt
A SaaS company based in Chennai, India, sells customer support software to small businesses worldwide and reports in USD. It starts the year with USD 50 million of ARR. During the year it wins USD 15 million of new ARR, existing customers add USD 6 million through upgrades and more users, and it loses USD 4 million to churn and downgrades. Sales and marketing spend to win the new customers was USD 18 million, and gross margin is 80 percent. Its free cash flow margin is 5 percent. Calculate ending ARR, growth, NRR, CAC payback, and the rule of 40.
Your interviewer will share data as you ask for it. Ask clarifying questions, state a hypothesis, then lay out your structure out loud before you calculate.
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