What is average revenue per account (ARPA)?

Average recurring revenue per customer account, usually monthly.

Definition

ARPA shows how much a typical customer pays and whether that is moving up market or down. ARPU, average revenue per user, is the per-seat equivalent.

Formula

ARPAARPA = MRR ÷ Number of active customer accounts

Example

Demo Co has $255.1K of MRR across 212 customers: ARPA of about $1,203 a month.

Benchmarks

There is no universal target; watch the trend and the mix. Rising ARPA with stable churn is usually healthy.

Common mistakes

  • Dividing by a customer count that includes duplicates.
  • Averaging away a few very large accounts that drive the business.

Examples use Demo Co, a fictional $3M ARR SaaS company, or a generic company where noted. Benchmarks are common reference points, not targets for every business.

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