Add your pricing tiers and growth assumptions to project your monthly recurring revenue over 24 months.
Pricing Tiers
Plan namePrice / moSubscribers
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Acquisition Pipeline
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days
Revenue Dynamics
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Unit Economics
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Add your pricing tiers and click calculate to see your MRR projections
Current MRR
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per month
Current ARR
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per year
ARPU
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Net Growth
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12-Mo ARR
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LTV
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NRR
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Quick Ratio
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LTV:CAC
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24-Month Projection
Monthly Breakdown
What is MRR?
Monthly Recurring Revenue (MRR) is the lifeblood metric of every subscription business. It represents the total predictable revenue your SaaS company earns each month from active subscriptions, normalized to a monthly amount. Unlike one-time sales, MRR gives you a reliable pulse on business health because it measures the revenue you can count on every 30 days.
For SaaS founders and product managers, MRR serves as the foundation for forecasting, fundraising, and strategic planning. Investors, boards, and stakeholders use MRR (and its annualized cousin, ARR) to evaluate business performance, growth trajectory, and unit economics.
How to Calculate MRR
The basic MRR formula is straightforward:
MRR = Sum of (Monthly Price × Number of Active Subscribers) for each plan
For businesses with multiple pricing tiers, you calculate the MRR contribution from each plan and sum them together. If you offer annual plans, divide the annual price by 12 to normalize it to a monthly figure.
To get a more complete picture, you should also track these MRR components:
New MRR — revenue from brand-new customers acquired this month
Expansion MRR — additional revenue from existing customers who upgraded or added seats
Churned MRR — revenue lost from customers who cancelled their subscriptions
Contraction MRR — revenue lost from existing customers who downgraded
Net New MRR — (New + Expansion) minus (Churned + Contraction)
MRR vs ARR
ARR (Annual Recurring Revenue) is simply MRR multiplied by 12. While mathematically simple, the choice of which metric to emphasize matters:
MRR is preferred for early-stage startups (under $10M ARR) because it shows month-to-month momentum and makes trends visible faster.
ARR is the standard for growth-stage and enterprise SaaS companies, especially when communicating with investors and boards who think in annual terms.
Both metrics should be tracked, but MRR is the operating metric (what you use for decisions) while ARR is the reporting metric (what you use in board decks and fundraising).
Understanding SaaS Unit Economics
Beyond MRR, the most critical metrics for evaluating SaaS health are LTV, CAC, and NRR:
LTV (Lifetime Value) — the total revenue you expect from a customer over their entire relationship: ARPU divided by monthly churn rate
CAC (Customer Acquisition Cost) — total sales and marketing spend divided by new customers acquired in the same period
LTV:CAC Ratio — a ratio of 3:1 or higher is considered healthy; below 1:1 means you spend more to acquire a customer than they are worth
NRR (Net Revenue Retention) — measures revenue retained from existing customers after accounting for expansion, contraction, and churn. Above 100% means you grow even without new customers.
MRR Components Explained
In advanced mode, this calculator breaks down your MRR into its four constituent components, which is how best-in-class SaaS teams track revenue:
New MRR — revenue from new paying customers. In our model, this comes from monthly signups multiplied by your trial conversion rate, with a delay based on trial length.
Expansion MRR — additional revenue from upgrades, add-ons, or seat expansions. Modeled as a percentage of existing customers who expand each month.
Churned MRR — revenue lost from cancellations. Modeled using your monthly churn rate applied to the existing customer base.
Contraction MRR — revenue lost from downgrades. Distinct from churn because the customer stays but pays less.
Key SaaS Benchmarks
Understanding where your metrics fall relative to industry benchmarks helps you identify strengths and areas for improvement:
Net Revenue Retention — median SaaS is 100–105%; best-in-class exceeds 120% (Snowflake, Twilio). Below 100% means your existing customer base is shrinking.
SaaS Quick Ratio — measures growth efficiency: (New + Expansion MRR) / (Churned + Contraction MRR). Above 4 is world-class, 2–4 is healthy, below 2 is a leaky bucket.
Monthly Churn — 3–5% is typical for SMB SaaS, 1–2% for enterprise. Above 5% is a red flag for product-market fit issues.
LTV:CAC Ratio — 3:1 or higher is the standard benchmark. Below 1:1 means you lose money on every customer acquired.
Frequently Asked Questions
For early-stage SaaS companies, 15–20% month-over-month MRR growth is considered strong. Growth-stage companies typically see 5–10% monthly growth, while mature SaaS businesses often grow at 2–5% monthly. The "triple triple double double double" framework suggests tripling ARR twice before doubling year-over-year toward $100M.
The median monthly churn rate for SaaS businesses is around 3–5% for SMB-focused products and 1–2% for enterprise. A monthly churn rate above 5% is a red flag. Best-in-class SaaS companies achieve "net negative churn" where expansion revenue from existing customers exceeds lost revenue from churned customers.
Annual subscriptions should be divided by 12 and spread evenly across months for MRR calculations. If a customer pays $1,200 annually, that contributes $100/month to MRR. In this calculator, enter the monthly equivalent price for any annual plans.
NRR measures how much revenue you retain and grow from existing customers. An NRR of 110% means your existing customer base grows by 10% even without any new customers. It is the single most important metric for SaaS investors because it indicates product stickiness and expansion potential. Use the Advanced mode to calculate your NRR.
The SaaS Quick Ratio measures growth efficiency by comparing how much revenue you add versus how much you lose: (New MRR + Expansion MRR) / (Churned MRR + Contraction MRR). A ratio above 4 is world-class (you add $4 for every $1 lost), 2–4 is healthy, and below 2 means you have a leaky bucket problem.
First, calculate LTV (Lifetime Value) by dividing your ARPU by your monthly churn rate. Then divide LTV by your CAC (Customer Acquisition Cost). A ratio of 3:1 means each customer generates 3x what it costs to acquire them. Below 1:1 means you lose money on every customer. Use Advanced mode and enter your CAC to see this metric.
Go deeper than a calculator.
The SaaS Metrics Analyzer takes your MRR, churn, and growth data and produces a full financial analysis with scenario modeling, industry benchmarks, and actionable recommendations.