alt Hacker NewsWait. ARR has no precise definition but has a clear social understanding. It’s clear Ed doesn’t get that and ARR not having a clear definition doesn’t absolve him of the mistake. His misunderstanding was on a different axis.
The miscalculations are pretty clearly pointed out in the tweet I linked earlier.
> Wait. ARR has no precise definition but has a clear social understanding.
This is (historically) a recipe for fraud and badness. If ARR is important enough to be reported, then there should be a GAAP definition.
Do you use calendar month or four week rolling? Do you account for seasonality? How do you recognise revenue? (My sense is that Anthropic do sketchy things with credits, as the consumer ones last for like 180 days and then expire).
ARR is a really, really, really easy metric to make sound like whatever you want which is why I am sceptical of it.
EDIT: I looked at the tweet which is a screenshot of a supposed sheet that Ed built. Unless you have a source for the sheet then I'll need to assign this relatively low credibility (don't know the user, it's a screenshot with no link).