Revenue Metrics

ARPA: Average Revenue Per Account

The average monthly or annual revenue generated per account or user.

Definition

Average Revenue Per Account (ARPA), or ARPU in consumer/PLG contexts, is the average revenue generated per account (or per user) over a defined period. ARPA tells you the density of your revenue base.

Formula

ARPA = Total Revenue in Period ÷ Number of Accounts in Period

ARPA = Total Revenue / Active Accounts

Worked example

£100,000 MRR across 200 accounts gives an ARPA of £500 per account per month. Lifting ARPA to £600 through expansion grows revenue 20% with no new logos.

Why it matters

ARPA is one of the cleanest expansion levers in any subscription business. Two companies with the same ARR can have very different operating models; the higher-ARPA business needs fewer customers, fewer reps and fewer support staff to hit the number.

Common mistakes

  • Computing ARPA across all accounts (including free) when only paid accounts matter
  • Failing to segment ARPA by tier or product line
  • Confusing ARPA with ACV (ARPA is per account per period; ACV is per contract per year)

Related terms

ACVMRRNRR

Read more in The Guide

Chapter: Metrics That Matter →

Sources & further reading

  • — Drawn from Evara's working definitions used on retained search and revenue advisory engagements (2024–2026).
  • — Reconciled against industry conventions in SaaStr, OpenView SaaS Benchmarks and Bessemer State of the Cloud.
  • — Reviewed by Rich Evans, Strategic Advisor at Evara and former operator/founder.

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