We said we would own the mid-market by the time you read this.

18-month update — Arroyo Systems, Series B class

The Original Commitments

Metric	Series B Forecast	Actual	Delta
ARR	$14.2M	$13.7M	-3.5%
Net Revenue Retention	118%	127%	+9 pts
Gross Margin	74%	78%	+4 pts
New Logos	94	81	-14%

Three Surprises

Upside #1

NRR expansion driven by warehouse-ops add-on, unexpectedly adopted by 63% of base

Upside #2

EMEA pilot converted to full region in month 11, ahead of 18-month target

Downside

SMB churn 18% vs 9% forecast — root cause and fix detailed in slides 4–5

SMB Churn Root Cause

We over-indexed on logos and under-invested in time-to-value.

The Fix: CS Transformation

Q1 2024

Hired Implementation Team

3 Implementation Engineers with SaaS onboarding expertise

Q2 2024

Launched Guided Onboarding

Time-to-value: 85-day median reduced to 34 days

Q3 2024

Churn Rate Returning

14% trailing 90-day churn, converging to forecast

Original Plan

• SMB-heavy go-to-market
• Add-on target $2.8M
• EMEA headcount +2
• Series C at $20M ARR

New Plan

• Shift budget to upmarket
• Add-on target $4.1M
• EMEA headcount +6
• Series C at $28M ARR

4.8x

LTV / CAC — Up from 3.1x at Series B close

14 mo

Payback Period

141%

Best-Cohort NRR

ARR Trajectory

Competitive Position

Team Additions

PM

Priya Menon

Chief Financial Officer

DV

Dom Vasquez

VP Engineering

LR

Lena Röder

Head of EMEA

"The financial infrastructure is now Series C-ready."

— Priya Menon, CFO

$38M Series C Extension

40%

Upmarket sales motion

35%

EMEA build-out

25%

CS infrastructure

Target close: October 31, 2025

Contact: Marcus Webb, CEO • marcus@arroyosystems.io