We’ve all seen the ads touting “one simple/crazy trick” to lower your insurance (or weight, or electric bill, or whatever). Now GigaOm has it’s own variant for cloud vendors to predict annual revenue:
Just take your July revenue and multiply it by 12. Or if you want to get even trickier, take your daily revenue on July 15 and multiply it by 365.
They’re both embarrassingly simple, but surprisingly accurate. For a subscription business with a consistent trajectory, it’ll get you extremely close to the ultimate answer – usually within a couple percentage points.
There is more to it of course.