MRR/ARR Growth Calculator
Calculate monthly and annual recurring revenue growth
Results
MRR Components Over Time
What is MRR/ARR Growth?
MRR (Monthly Recurring Revenue) and ARR (Annual Recurring Revenue) are fundamental metrics for SaaS and subscription businesses. MRR represents the predictable monthly revenue from subscriptions, while ARR is simply MRR × 12. These metrics are crucial because they show predictable, recurring revenue rather than one-time sales.
Tracking MRR components (new, expansion, and churned) helps you understand revenue health and growth drivers. Net Revenue Retention (NRR) and Quick Ratio are key indicators of business sustainability. High NRR (above 100%) means you're growing revenue from existing customers, while a strong Quick Ratio indicates efficient growth. For overall revenue projections, see our Revenue Growth Calculator to forecast total revenue growth.
How to Use This Calculator
Enter your current MRR, monthly new MRR (from new customers), expansion MRR (from upgrades), churned MRR (from cancellations), and projection period. The calculator shows projected MRR, ARR, growth rate, net revenue retention, and Quick Ratio.
Use the chart to visualize how new, expansion, and churned MRR contribute to total MRR over time. This helps you understand the balance between acquisition, expansion, and retention.
Formula Explained
The MRR calculation tracks components over time:
ARR = MRR × 12
Net Revenue Retention = (Starting MRR + Expansion - Churn) / Starting MRR × 100
Quick Ratio = (New MRR + Expansion MRR) / Churned MRR
Source: SaaS Metrics - MRR, ARR, and Revenue Retention Calculations
When to Use This Calculator
Use this calculator when planning SaaS growth, preparing investor presentations, or analyzing revenue health. It's essential for understanding how new customer acquisition, expansion revenue, and churn affect your recurring revenue trajectory. For tracking customer growth, use our Customer Growth Rate Calculator to see how customer acquisition drives MRR.
SaaS executives and investors use MRR/ARR projections to evaluate business health, make strategic decisions, and communicate performance. These metrics are often more important than total revenue for subscription businesses because they show predictable, scalable revenue.
Tips for Best Results
- Track components separately: Monitor new, expansion, and churned MRR separately to identify growth drivers and problems. This helps you focus improvement efforts.
- Aim for high NRR: Net Revenue Retention above 100% is a strong indicator of product-market fit. Focus on expansion revenue and reducing churn to improve NRR.
- Maintain Quick Ratio above 4: A Quick Ratio above 4 means you're adding revenue 4x faster than losing it. If it's below 4, focus on reducing churn or increasing new/expansion MRR.
- Focus on expansion revenue: Expansion MRR (upsells, upgrades) is often more profitable than new MRR because it doesn't require customer acquisition costs.
- Monitor churn closely: High churn can kill growth even with strong new customer acquisition. Track churn rates and reasons to identify and fix problems early.
- Plan for runway: Use our Startup Runway Calculator to ensure MRR growth supports your cash flow needs.
Frequently Asked Questions
What is MRR and ARR?
MRR (Monthly Recurring Revenue) is the predictable monthly revenue from subscriptions. ARR (Annual Recurring Revenue) is MRR × 12. These metrics are crucial for SaaS businesses because they show predictable, recurring revenue rather than one-time sales. They're key indicators of business health and growth potential.
What's the difference between new, expansion, and churned MRR?
New MRR comes from new customers. Expansion MRR comes from existing customers upgrading or adding services. Churned MRR is revenue lost from customers canceling or downgrading. Net New MRR = New MRR + Expansion MRR - Churned MRR. Tracking these separately helps identify growth drivers and problems.
What's a good MRR growth rate?
Good MRR growth rates vary by stage. Early-stage SaaS companies might target 15-20% monthly growth. Growth-stage companies often target 5-10% monthly. Mature companies might target 2-5% monthly. Focus on sustainable growth with strong unit economics rather than just high growth rates.
What is net revenue retention?
Net Revenue Retention (NRR) measures how much revenue you retain from existing customers, including expansion and churn. NRR = (Starting MRR + Expansion MRR - Churned MRR) / Starting MRR × 100. NRR above 100% means you're growing revenue from existing customers even after churn, which is a strong indicator of product-market fit.
What is the Quick Ratio?
Quick Ratio = (New MRR + Expansion MRR) / Churned MRR. It measures growth efficiency - how much new revenue you add for every dollar lost to churn. A Quick Ratio above 4 is considered healthy, meaning you're adding revenue 4x faster than losing it. Lower ratios indicate churn problems.
Related Calculators
Revenue Growth Calculator
Project business revenue growth over time
Customer Growth Rate Calculator
Calculate customer acquisition and churn metrics
SaaS Growth Calculator
Project SaaS customer and revenue growth
Business Valuation Growth Calculator
Project business valuation based on revenue multiples
Startup Runway Calculator
Calculate cash runway and breakeven timing
Employee Headcount Growth Calculator
Plan employee hiring and payroll growth
Related Calculators
Revenue Growth Calculator
Project business revenue growth over time
Customer Growth Rate Calculator
Calculate customer acquisition and churn metrics
SaaS Growth Calculator
Project SaaS customer and revenue growth
Employee Headcount Growth Calculator
Plan employee hiring and payroll growth