MRR Growth Rate Calculator
Calculate monthly recurring revenue growth rate from net new MRR, plus the compounded annualized rate and projected ARR. Runs in your browser.
New + expansion − churned − contraction.
MRR growth
- Ending MRR
- $54,000
- Monthly growth rate
- 8.00%
- Annualized growth (compounded)
- 151.8%
- Projected ARR (ending MRR × 12)
- $648,000
Monthly growth = net new MRR ÷ starting MRR. Annualized assumes the rate compounds for 12 months — sustained high monthly growth annualizes dramatically (10%/mo ≈ 214%/yr). Net new MRR should net out churn and contraction, not just gross new sales. Informational.
About this tool
Monthly recurring revenue (MRR) growth is the pulse of a subscription business. This calculator computes your monthly growth rate as net new MRR divided by starting MRR, then compounds it into an annualized rate and projects your annual recurring revenue (ARR) from the ending MRR. The key input is net new MRR — new plus expansion revenue minus churned and contracted revenue — because gross new sales alone overstate growth when churn is eating into the base. The annualized figure is eye-opening: because growth compounds, a steady 10% per month annualizes to roughly 214% a year, which is why early-stage SaaS targets like 'T2D3' (triple, triple, double, double, double) are even conceivable. Conversely, slowing monthly growth compounds downward just as fast. Use it to track momentum, set targets, and translate a month's performance into an annual trajectory. It assumes the current month's rate persists, which real businesses rarely sustain, so treat the annualized number as a trajectory, not a forecast. It is informational, not financial advice. Everything runs in your browser.
How to use it
- Enter your starting MRR for the month.
- Enter net new MRR (new + expansion − churned − contraction).
- Read the monthly and annualized growth rates.
- Use it to track momentum and set growth targets.
Frequently asked questions
- How is MRR growth rate calculated?
- Monthly growth = net new MRR ÷ starting MRR. If you start at $50,000 and add $4,000 net, that is 8% monthly growth. The ending MRR is starting plus net new.
- What is "net new" MRR?
- New MRR from new customers, plus expansion MRR from upgrades, minus churned MRR (cancellations) and contraction MRR (downgrades). Using net new — not gross new sales — is essential, because churn offsets new growth and gross figures flatter the rate.
- How does monthly growth annualize?
- It compounds: annualized = (1 + monthly rate)^12 − 1. So 10% monthly is about 214% annually, and even 5% monthly is roughly 80% annually. Compounding is why consistent monthly growth produces such large annual numbers.
- What is a good MRR growth rate?
- It depends on stage. Early-stage startups may target 10–20%+ monthly; as ARR grows, sustaining high percentages gets harder, so larger companies measure healthy growth in annual terms (e.g. 40%+ YoY at scale). Compare to your stage and peers.
- Why is the annualized figure just a trajectory?
- It assumes this month's rate continues for a year, which almost never holds — growth rates change as the base grows and markets saturate. Read it as "if this pace held," useful for momentum, not as a literal forecast.
- Is this financial advice?
- No. It is an informational metric calculation.