T2D3 Growth: The SaaS Trajectory to $100M ARR
Published 2026-08-02
TL;DR
Neeraj Agrawal, then at Battery Ventures, described the SaaS-to-$100M path in 2015: after $1M ARR, triple in Y1, triple in Y2, double in Y3, Y4, Y5. That lands you at $108M.
The trajectory
| Year | Starting ARR | Multiple | Ending ARR |
|---|---|---|---|
| 1 | $1M | 3x | $3M |
| 2 | $3M | 3x | $9M |
| 3 | $9M | 3x → 2x* | $18M |
| 4 | $18M | 2x | $36M |
| 5 | $36M | 3x → 2x* | $72M |
| 6 | $72M | ~1.5x | $108M |
*Original write-up varies slightly; the doubling years compress with scale.
Why $1M ARR is the start line
Below $1M ARR the base is too small for growth-multiple language to be meaningful. Going from $200k to $600k is trivial in dollar terms and does not require the go-to-market machine that triples $3M into $9M.
What tripling requires
At $1M ARR: usually founder-led sales, product-market fit, one repeatable channel. Enough to add $2M net new ARR in a year.
At $3M → $9M: the first sales team, marketing spend that returns above 1:1, retention that supports upsell.
At $9M → $18M+: multi-channel motion, pricing power, and enterprise deals in the pipeline. Nothing about this is automatic.
Post-ZIRP reality
In the 2020-21 environment T2D3 was almost baseline for top-quartile SaaS. From 2022 onward it became harder to fund the burn required for triple. Many boards accepted T2D2D3 or T2D2D2 as the new elite bar in exchange for a burn multiple under 1x.
Using the calculator
Enter your current MRR and target MRR. Set the growth rate to what T2D3 implies for your stage:
- $1M ARR → 10% MoM to reach $3M in 12 months
- $3M → $9M in 12 months: 9.6% MoM
- $9M → $18M in 12 months: 5.9% MoM
Try in the MRR / ARR growth calculator.
Common mistakes
- Comparing YoY on a moving base (mid-year comparisons).
- Using bookings instead of ARR (bookings can include multi-year prepay).
- Confusing gross ARR growth with net (churn matters).
- Setting T2D3 as a target when your gross margin can’t support the burn.
Related
- MRR / ARR Growth Calculator
- Rule of 40 — the profitability check on the growth trajectory
- Quick Ratio — measures whether the growth is real
FAQ
Does T2D3 still apply in 2026?+
The shape does; the pace is harder. Post-ZIRP, more companies stretch T2D3 into T2D2D3 (an extra doubling year).
Where does the clock start?+
At $1M ARR. Below that, growth rates are noisy and the base is too small for the multiplier math to be meaningful.
What if I miss the first triple?+
Growth rates compound in your valuation. Missing the first triple can drop your multiple by 30-50% at your next round.
How does this relate to Rule of 40?+
T2D3 is a growth-only trajectory. Rule of 40 adds margin. Elite companies do both.
Is triple-triple realistic for consumption pricing?+
Consumption revenue is choppier. Look at TTM net new ARR to smooth it.