Making sense of RPO, ARR and deferred revenues

If you are an investor in a SaaS company, you likely have heard these terms bantered around…RPO, ARR and deferred revenues. What the heck are they? Why are they important? How are they different from normal revenues? Which one is more important versus the others?

• RPO represents the multi-year contracted revenue pipeline
• ARR is a 1-year revenue projection and does not include non-recurring revenue such as consulting fees
• Deferred revenues only include what clients have pre-paid in advance of services rendered.

If all this still has your head spinning, then I don’t blame you.

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