Recurring Revenue Growth Calculator
Calculate and project growth of your recurring revenue stream over time. Model the compound effect of consistent MRR growth with different churn rates and expansion scenarios.
📊 SaaS💼 MRR Next Month = MRR * (1 + Growth% - Churn%)
Current MRR ($)
Monthly net growth rate (%)
Monthly churn rate (%)
Projection months
Please enter valid values.
Formula & Reference
| Variable | Formula | Units |
|---|---|---|
| Recurring Revenue Growth Calculator | MRR Next Month = MRR * (1 + Growth% - Churn%) | $/month |
Step-by-Step Examples
Example 1
Healthy SaaS Growth
$20k MRR, 8% new growth, 2% churn, 24 months.
- Net growth: 6%/month
- In 24 months: $20k * (1.06)^24 = $80,995
- ARR: $971,940 | Doubles every 11.9 months
✓ $81k MRR, $972k ARR in 24 months
Example 2
High Churn Problem
$30k MRR, 5% growth, 4% churn, 12 months.
- Net growth: 1%/month
- In 12 months: $30k * (1.01)^12 = $33,800
- Barely growing despite 5% new MRR - churn is killing it
✓ $33.8k MRR after 12 months - churn destroys growth
Example 3
Negative Net Growth
$50k MRR, 3% growth, 5% churn, 12 months.
- Net growth: -2%/month
- In 12 months: $50k * (0.98)^12 = $39,113
- Shrinking MRR despite positive new sales!
✓ Shrinking to $39k despite adding new customers
Real-World Applications
SaaS Founders
Model different growth and churn scenarios to set realistic ARR targets.
Investors
Project MRR trajectory to evaluate investment timing and potential.
Revenue Planning
Build bottom-up revenue models for board reporting and headcount planning.
Goal Setting
Set monthly MRR targets backed by compound growth math.
Common Mistakes to Avoid
⚠️
Ignoring churn in growth projections
Projecting MRR growth rate without subtracting churn gives wildly optimistic forecasts. Net growth = new MRR growth minus churn rate.
⚠️
Assuming constant growth rate
Growth rates change as you scale: faster early (small base), typically slower at $1M+ ARR as market penetration deepens and competitive dynamics shift.
⚠️
Not modeling expansion revenue
The formula here uses net growth (new customers only). Businesses with strong expansion revenue can have positive net MRR growth even with significant churn.
Frequently Asked Questions
What is net MRR growth rate? ▾
New MRR added as a % of total MRR, minus MRR lost to churn and contraction. If you add 8% new MRR and lose 2% to churn, net growth = 6%.
How does churn affect long-term growth? ▾
Dramatically. At 10% monthly new growth with 2% churn (8% net), you grow 150% annually. At 5% churn (5% net), you grow only 80%. Small churn differences compound into massive valuation differences.
What MRR growth rate sustains a healthy SaaS business? ▾
5-10% monthly net growth at early stage. 2-4% at $1M+ ARR. Below 1% monthly is concerning at any stage if your cost structure doesn't support profitability at current scale.
How do I model MRR for fundraising? ▾
Use current MRR, last 6 months of actual net growth rate, and model 3 scenarios (bear/base/bull). Justify your base case growth rate assumption with data.
What is the T2D3 target for MRR? ▾
Triple to $1M ARR, triple again to $3M, then double to $6M, double to $12M, double to $24M. Roughly tracks to 15-20% monthly MRR growth early on, declining as scale increases.