Monthly Recurring Revenue (MRR) is the most important metric for any subscription
business. It normalizes revenue across billing periods — annual subscribers, monthly
subscribers, and quarterly subscribers all contribute their monthly equivalent — giving
you a single number that represents predictable, steady-state revenue.
This calculator lets you add up to five subscription plans, each with its own
monthly price and subscriber count, and computes the combined MRR, Annual Recurring
Revenue (ARR = MRR × 12), and a 12-month growth projection at a custom growth rate.
Key MRR concepts
New MRR — revenue from brand-new customers this month.
Expansion MRR — additional revenue from existing customers who upgraded.
Churned MRR — revenue lost from cancellations.
Net New MRR = New MRR + Expansion MRR − Churned MRR.
A healthy SaaS typically targets Net New MRR that grows the base by 10–20% month-over-month at
early stage and 3–5% at scale.
How to use this calculator
Enter each plan's monthly price and number of active subscribers.
For annual plans, enter the monthly equivalent (annual price ÷ 12).
Optionally enter a monthly growth rate to project future MRR.
Frequently asked questions
Should I count annual subscribers in MRR?
Yes — MRR includes the monthly equivalent of all recurring revenue regardless of
billing period. A customer paying $1,200/year contributes $100/month to MRR.
What's the difference between MRR and revenue?
Revenue (cash received) differs from MRR (recognized monthly equivalent). If you
collect a $1,200 annual payment upfront, you recognize $100/month to MRR, but
received $1,200 in cash in month 1. Investors and VCs evaluate both, but MRR is
the primary growth health metric.
What's a good MRR growth rate?
Y Combinator famously targets 5–7% week-over-week (about 20–30% month-over-month)
during the early growth phase. At later stages, 10–15% monthly is strong, and
5–8% is typical for a healthy, scaling SaaS.
MRR growth rate benchmarks by stage — seed, Series A, growth — and how to calculate your current growth rate.
MRR growth rate is the single number most investors, accelerators, and founders use
to gauge the health of a SaaS business. But what's actually "good"?
Growth rate benchmarks by stage
Stage
Monthly MRR growth
Annual growth equivalent
Pre-product-market fit
5–10%
80–214%
Early traction (seed)
10–20%
214–792%
Y Combinator benchmark
5–7% week-over-week
Implied ~20–30%/month
Series A target
15–25%
435–1,355% ARR growth
Series B+ scale
5–10%
80–214%
Public SaaS (median)
2–5%
27–80% ARR
The YC "default alive" framework: at your current MRR growth rate and burn, will you
become profitable before running out of money? The MRR calculator above can project
this for you.
How to calculate your MRR growth rate
Month-over-month growth rate = ((MRR this month - MRR last month) / MRR last month) × 100
If your MRR was $8,000 last month and is $9,000 this month:
((9,000 - 8,000) / 8,000) × 100 = 12.5% MoM growth
What drags down growth rate: net churn
A 15% gross churn rate can completely offset strong new customer acquisition. If you're
adding $2k in new MRR each month but losing $1.8k to churn, your net new MRR is only
$200, regardless of how fast you're growing the top of the funnel.
Use the churn impact calculator to see exactly how your churn rate is affecting your
MRR trajectory.
How SaaS companies are valued relative to MRR and ARR — revenue multiples by growth rate, profitability, and company stage.
SaaS companies are valued as a multiple of ARR (Annual Recurring Revenue = MRR × 12).
Understanding these multiples helps founders estimate company value, benchmark
fundraising terms, and understand what growth rate is needed to justify a target valuation.
Revenue multiples by stage (2024 environment)
Stage
ARR
Typical ARR Multiple
Notes
Pre-revenue / MVP
<$10k
N/A (team + market)
Valued on potential
Early traction
$10k–$500k
3–8×
Proof of concept
Growth
$500k–$5M
5–15×
PMF established
Scale
$5M–$20M
8–20×
Strong NRR, growth
Late growth
$20M+
10–25×
Near-public quality
These are wide ranges because multiples depend heavily on growth rate, NRR, and
gross margin. A company growing 150% YoY with 120% NRR commands a much higher
multiple than one growing 30% with 95% NRR.
The growth + margin premium
The Rule of 40 score (growth rate + profit margin) strongly predicts the valuation
multiple. Public SaaS data shows:
- Rule of 40 < 20: ~6–8× ARR
- Rule of 40 20–40: ~8–12× ARR
- Rule of 40 40–60: ~12–18× ARR
- Rule of 40 > 60: ~18–30× ARR
Annual vs Monthly Billing — Impact on MRR and Cash Flow
How offering annual subscriptions affects your MRR calculation, cash flow, and effective churn rate — including worked examples.
Offering annual billing alongside monthly is one of the highest-leverage decisions
a SaaS founder can make. Here's the full picture of the tradeoffs.
How annual billing is counted in MRR
An annual subscriber paying $1,188/year ($99 × 12) contributes $99 MRR —
the same as a monthly subscriber. Their ARR contribution is $1,188.
The $1,188 received upfront is deferred revenue — you earn it $99/month
as you deliver the service. From an MRR perspective, both billing types are identical.
Cash flow advantage of annual billing
The difference is pure cash flow and churn reduction:
Metric
Monthly billing
Annual billing
Cash received today
$99
$1,188
Churn risk this month
~2–3%
~0% (locked in)
Effective annual churn
24–36%
5–15%
Customer LTV
~$1,200–2,475
~$2,000–4,000
Annual subscribers churn at 5–10× lower rates because: (1) they're already
committed, (2) they evaluated the product more carefully before buying, and
(3) the renewal decision happens once a year rather than implicitly every month.
Typical annual discount to offer
Industry standard is a 10–20% discount for annual payment (equivalent to giving
1–2 months free). This converts enough monthly subscribers to annual to improve
cash position and reduce churn, while not unduly reducing revenue.
Use our MRR Calculator to model your revenue mix with
different ratios of monthly vs annual subscribers.
SaaS MRR Benchmarks — What Is Good MRR Growth by Stage?
MRR growth benchmarks for SaaS companies from $0 to $1M MRR — monthly growth rates, time-to-targets, and what separates top quartile from average.
Understanding what "good" MRR growth looks like at each stage helps founders
set realistic targets and diagnose whether their growth is on track.
MRR growth benchmarks by stage
MRR Stage
Top Quartile MoM Growth
Median MoM Growth
T2D3 Target
$0 → $10k
30–50%+
15–25%
30%+
$10k → $50k
20–30%
10–20%
20–25%
$50k → $100k
15–20%
8–15%
15–20%
$100k → $500k
10–15%
5–10%
~12%
$500k+ MRR
7–12%
4–7%
~8%
Time to common MRR milestones
At a steady 15% monthly growth from $1k MRR:
- $10k MRR: ~16 months
- $50k MRR: ~26 months
- $100k MRR: ~31 months
Growth rates typically slow as you scale — early growth of 30%/month is much
harder to sustain above $50k MRR as channel saturation increases.
Leading indicators of MRR growth
Track these weekly: new trial starts, trial-to-paid conversion rate, expansion
revenue from upgrades, and net new MRR (new + expansion − churn). These predict
next month's MRR before it appears in the headline number.