MRR Growth Rate Calculator
Inputs
| Starting MRR | 50,000 $ |
|---|---|
| New MRR | 8,000 $ |
| Expansion MRR | 3,000 $ |
| Contraction MRR | 1,000 $ |
| Churned MRR | 2,000 $ |
MRR Growth Rate Calculator
Calculate net new MRR and monthly MRR growth rate from new, expansion, contraction, and churned recurring revenue.
Inputs
Results
Enter a value to see results.
Details
What net new MRR measures
Net new MRR is the net change in monthly recurring revenue over a single period. It captures everything that moved the recurring revenue line: customers won, existing customers spending more, existing customers spending less, and customers lost. Rolling those four forces into one number shows whether recurring revenue grew or shrank, and the growth rate expresses that change relative to where the period started.
Tracking the components separately matters because the same net result can come from very different dynamics. Flat net new MRR might mean nothing happened, or it might mean strong new sales exactly offset heavy churn — two situations that call for very different responses.
The four components
Net new MRR combines two sources of gain and two sources of loss:
- New MRR — recurring revenue from brand-new customers acquired this period.
- Expansion MRR — additional recurring revenue from existing customers through upgrades, added seats, or cross-sells.
- Contraction MRR — recurring revenue lost when existing customers downgrade without leaving entirely.
- Churned MRR — recurring revenue lost from customers who cancelled.
The first two add to recurring revenue; the last two subtract from it.
The formula
Net new MRR is gains minus losses:
Net New MRR=New+Expansion−Contraction−ChurnEnding MRR is the starting run rate plus that net change:
Ending MRR=Starting MRR+Net New MRRAnd the growth rate states the change as a percentage of the starting base:
Growth Rate=Starting MRRNet New MRRWorked example
A business starts the month at 50,000 MRR. During the month it adds 8,000 from new customers and 3,000 from upgrades, while losing 1,000 to downgrades and 2,000 to cancellations.
Net new MRR is the gains minus the losses:
8,000+3,000−1,000−2,000=8,000Ending MRR adds that to the starting run rate:
50,000+8,000=58,000And the growth rate is the net change over the starting base:
50,0008,000=16%The business grew recurring revenue 16% in the month, ending at 58,000 MRR.
New versus expansion growth
Splitting gains into new and expansion MRR reveals where growth comes from. New MRR reflects how well the business acquires customers; expansion MRR reflects how well it grows the accounts it already has.
A business that leans heavily on new MRR must keep filling the top of the funnel just to stay level once churn is accounted for. A business with strong expansion MRR can grow even with modest new sales, because existing customers contribute more over time. When expansion exceeds contraction plus churn, the existing base grows on its own — a powerful and capital-efficient form of growth.
Reading the growth rate
Because the growth rate divides by the starting base, a fixed amount of net new MRR represents a smaller percentage as the business gets larger. Adding 8,000 to a 50,000 base is 16%; adding the same 8,000 to a 500,000 base is only 1.6%. High percentage growth is therefore easier to sustain early and naturally moderates with scale.
The growth rate is most useful read alongside churn and the new-versus-expansion mix rather than on its own. To translate a monthly run rate into its annual equivalent, pair this calculator with the MRR to ARR Calculator.
Frequently Asked Questions (FAQ)
What is net new MRR?
Net new MRR is the net change in monthly recurring revenue over a period. It adds new MRR from fresh customers and expansion MRR from existing customers, then subtracts contraction MRR from downgrades and churned MRR from cancellations. A positive figure means recurring revenue grew; a negative figure means it shrank.
How is the MRR growth rate calculated?
Divide net new MRR by starting MRR. For example, with 50,000 starting MRR and 8,000 net new MRR, the growth rate is 8,000 ÷ 50,000 = 16%. The rate measures growth relative to the base at the start of the period, which is why a fixed amount of net new MRR represents a smaller percentage as the base grows.
What is the difference between expansion MRR and new MRR?
New MRR comes from customers acquired during the period. Expansion MRR comes from existing customers spending more — upgrades, additional seats, or cross-sells. Separating the two shows whether growth is driven by winning new accounts or by deepening relationships with current ones; strong expansion can offset churn and sustain growth without constant new acquisition.
What is a good monthly MRR growth rate?
It depends heavily on stage and size. Early-stage businesses sometimes sustain 10–20% month over month, but those rates are hard to maintain as the base grows, since the same net new MRR becomes a smaller percentage. More mature businesses commonly see low single-digit monthly growth. Growth is best judged alongside churn and the mix of new versus expansion revenue.
Disclaimer
Contraction and churn are entered as positive amounts and subtracted. This calculator measures a single period and does not compound growth across months or account for seasonality. Results are for planning purposes and depend on consistent definitions of each MRR component.
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MRR to ARR Calculator
Convert monthly recurring revenue (MRR) to annual recurring revenue (ARR) and back. MRR × 12 = ARR; ARR ÷ 12 = MRR.