Annualise recent revenue into a run rate and test it against growth.
A simple run rate assumes no growth and no seasonality, which makes it a snapshot rather than a forecast. Compounding growth over twelve months produces a substantially higher total than the run rate suggests. Quoting run rate from the best recent month is a well-known way to overstate scale, which is why investors ask for the underlying monthly series.
Run Rate
Run rate = period revenue ÷ months × 12; growth projection sums a geometric series
Run rate = period revenue ÷ months × 12; growth projection sums a geometric series A simple run rate assumes no growth and no seasonality, which makes it a snapshot rather than a forecast. Compounding growth over twelve months produces a substantially higher total than the run rate suggests.
Quoting run rate from the best recent month is a well-known way to overstate scale, which is why investors ask for the underlying monthly series.
This calculator takes 4 inputs: Revenue in the period, Length of the period, Monthly growth rate, Seasonality adjustment. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.