Free Tool

Rule of 40 Calculator

The Rule of 40 says a healthy SaaS company's growth rate plus profit margin should total at least 40%. See where you stand.

Revenue growth rate (% YoY)

Profitability metric

Profit margin (%) — can be negative

Current ARR (optional)

Prior-year ARR (optional)

Tip: enter current and prior-year ARR and the growth rate is computed for you.

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GrowthMargin

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Growth contribution

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Margin contribution

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