SaaS MRR Calculator

Calculate, analyze, and benchmark your SaaS recurring revenue metrics to improve your business performance.

Calculate Your SaaS Revenue Metrics

Use our free calculator to understand your MRR, ARR, and Customer Lifetime Value.

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Retain more customers by providing timely help and ensuring they successfully adopt your product's core features.

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Frequently Asked Questions About SaaS MRR

Everything you need to know about calculating and improving your recurring revenue metrics.

Monthly Recurring Revenue (MRR) is a normalized measure of the predictable and recurring revenue components of your subscription business. It's one of the most important metrics for SaaS companies.

MRR helps you understand your business's health and growth trends month over month. It excludes one-time fees, non-recurring add-ons, and other variable revenue sources.

The basic formula for MRR is:

MRR = Number of Customers × Average Revenue Per User (ARPU)

Average Revenue Per User (ARPU) is calculated by dividing your total MRR by the number of active customers:

ARPU = MRR ÷ Number of Active Customers

ARPU helps you understand how much revenue you generate from each customer on average. Increasing ARPU is often easier and more cost-effective than acquiring new customers, making it a key focus area for sustainable growth.

MRR growth rates vary widely based on company stage, market segment, and funding status. However, general benchmarks for monthly MRR growth are:

  • Early-stage startups (under $1M ARR): 15-20% month-over-month

  • Growth-stage companies ($1M-$10M ARR): 8-15% month-over-month

  • Scaling companies ($10M+ ARR): 5-8% month-over-month

  • Public SaaS companies: 2-5% month-over-month

Remember that consistent growth is often more valuable than sporadic spikes. A sustainable 10% monthly growth compound quickly and leads to more predictable scaling.

Churn rate measures the percentage of customers or revenue that you lose over a specific period. There are two main types of churn:

  • Customer churn: The percentage of customers who cancel or don't renew their subscriptions.

  • Revenue churn: The percentage of revenue lost due to cancellations, downgrades, or non-renewals.

Churn directly impacts your MRR growth. Even with strong customer acquisition, high churn can stall or reverse your growth. This is known as the "leaky bucket" problem in SaaS.

For example, if your monthly customer churn is 5% and you don't add new customers, you'll lose approximately 46% of your current customer base within a year.

Here are key strategies to boost your MRR growth:

  1. Reduce churn: Improve customer onboarding, customer success, and product experience.

  2. Increase ARPU: Implement strategic price increases, create upsell opportunities, and add premium features.

  3. Optimize your pricing: Regularly review and adjust your pricing tiers based on value delivered and market conditions.

  4. Expand through add-ons: Develop complementary features or services that existing customers can add to their subscription.

  5. Improve onboarding: Use product tours and interactive guides to help new users quickly discover the value of your product.

The most sustainable approach typically combines reducing churn while simultaneously increasing the value (and price) of your offering.

Customer Lifetime Value (CLV) represents the total revenue a business can expect from a single customer account throughout their relationship with the company.

The simplest way to calculate CLV for subscription businesses is:

CLV = ARPU ÷ Customer Churn Rate

For example, if your ARPU is $100 and your monthly churn rate is 5%, your CLV would be $100 ÷ 0.05 = $2,000.

CLV is critical for determining how much you can spend on customer acquisition while maintaining profitability. Generally, your customer acquisition cost (CAC) should be less than 1/3 of your CLV for a healthy SaaS business.

Product tours can significantly impact your MRR by:

  • Reducing churn: Helping users quickly find value in your product, leading to better retention.

  • Increasing feature adoption: Guiding users to use more features, increasing their perceived value of your product.

  • Improving conversion rates: Demonstrating value during free trials leads to higher conversion to paid accounts.

  • Facilitating upsells: Introducing premium features contextually can encourage upgrades.

  • Enhancing user experience: Reducing friction and confusion, leading to increased product satisfaction.

By implementing targeted product tours with tools like Hopscotch, companies typically see 25-30% improvements in activation rates and 10-15% reductions in churn, both of which directly impact MRR growth.