Monthly Recurring Revenue (MRR) Calculator: Growth & ARR

What does an MRR of $24,500.00 mean?

It means the business takes in $24,500.00 every month from its paying customers — 500 customers at $49.00 a month. Over a year that is $294,000.00 of ARR. But the MRR is not the whole story: 15 customers leave each month and take $735.00 of MRR with them, and 25 new customers bring $1,225.00, so the business keeps $490.00 of the difference — 2.00% growth a month. The MRR, the net new MRR and the growth are three outputs, never the same number — the MRR is what the business earns each month, the net new MRR is what it gains each month, and the growth is the gain as a share of the MRR.

Three things to check before you trust the number

The ARPU does not change the growth. At $59.00 the MRR is $29,500.00 and the net new MRR is $590.00, and the growth is still 2.00%. The ARPU scales the MRR, the churned MRR and the new MRR together — if changing the ARPU changes your growth, the formula is wrong.

Churn is the lever that moves the growth. At 5% churn the net new MRR is $0.00 and the growth is 0.00%, and at 1% churn it is $980.00 and 4.00%. A single point of churn is worth $245.00 of net new MRR a month on the defaults — more than ten new customers.

More customers can still mean shrinking. At 1,000 customers the MRR is $49,000.00 but the net new MRR is −$245.00 and the growth is −0.50%: twice the customers means twice the churn, and the same 25 new customers cannot replace them. A bigger MRR is not the same as a growing business.

Worked example

On the defaults: 500 paying customers; ARPU $49.00 a month; churn 3% a month; 25 new customers a month.

1. Monthly recurring revenue: 500 × $49.00 = $24,500.00.
2. Annual recurring revenue: $24,500.00 × 12 = $294,000.00.
3. Churned customers: 500 × 3 ÷ 100 = 15.
4. Churned MRR: 15 × $49.00 = $735.00.
5. New MRR: 25 × $49.00 = $1,225.00.
6. Net new MRR: $1,225.00 − $735.00 = $490.00.
7. Net MRR growth: $490.00 ÷ $24,500.00 × 100 = 2.00%.
8. MRR in 12 months (linear): $24,500.00 + $490.00 × 12 = $30,380.00.
9. Smallest ARPU for a $25,000 MRR: $50.00 — at $50.00 the MRR is $25,000.00, and at $49.99 it is $24,995.00.
10. Smallest customer count for a $25,000 MRR: 511 — at 511 the MRR is $25,039.00, and at 510 it is $24,990.00.

Every branch, checked

• 600 customers: 600 customers: MRR $29,400.00; ARR $352,800.00; net new MRR $343.00; net MRR growth 1.17%. More customers at the same price, so a bigger MRR — but the same 25 new customers, so slower growth: 1.17% (unrounded 1.166667%).
• 400 customers: 400 customers: MRR $19,600.00; ARR $235,200.00; net new MRR $637.00; net MRR growth 3.25%. Fewer customers at the same price, so a smaller MRR — and the same 25 new customers, so faster growth.
• ARPU $59.00: ARPU $59.00: MRR $29,500.00; ARR $354,000.00; net new MRR $590.00; net MRR growth 2.00%. A higher price scales the MRR, the churned MRR and the new MRR together, so the growth does not move.
• ARPU $39.00: ARPU $39.00: MRR $19,500.00; ARR $234,000.00; net new MRR $390.00; net MRR growth 2.00%. A lower price scales everything down together, so the growth does not move.
• Churn 5%: Churn 5%: MRR $24,500.00; ARR $294,000.00; net new MRR $0.00; net MRR growth 0.00%. Churn eats exactly what new customers bring, so the net new MRR is $0.00 and the growth is 0.00%.
• Churn 1%: Churn 1%: MRR $24,500.00; ARR $294,000.00; net new MRR $980.00; net MRR growth 4.00%. Less churn, so more of the new MRR is kept — $980.00 net, 4.00% growth.
• 50 new customers a month: 50 new customers a month: MRR $24,500.00; ARR $294,000.00; net new MRR $1,715.00; net MRR growth 7.00%. Twice as many new customers, so the net new MRR more than triples to $1,715.00.
• 10 new customers a month: 10 new customers a month: MRR $24,500.00; ARR $294,000.00; net new MRR −$245.00; net MRR growth −1.00%. Fewer new customers than churn takes, so the business shrinks by $245.00 a month.
• 1,000 customers: 1,000 customers: MRR $49,000.00; ARR $588,000.00; net new MRR −$245.00; net MRR growth −0.50%. Twice the customers, twice the churn, the same 25 new customers — so the business shrinks.
• ARPU $99.00: ARPU $99.00: MRR $49,500.00; ARR $594,000.00; net new MRR $990.00; net MRR growth 2.00%. A much higher price scales the MRR and the net new MRR together, so the growth stays at 2.00%.

The reverses, worked backwards

• Smallest ARPU for the MRR to STAY at or above $25,000: $50.00 — at $50.00 the figures are MRR $25,000.00; ARR $300,000.00; net new MRR $500.00; net MRR growth 2.00% (unrounded 2.000000%); at the lower neighbor the figures are MRR $24,995.00; ARR $299,940.00; net new MRR $499.90; net MRR growth 2.00% (unrounded 2.000000%); at the upper neighbor the figures are MRR $25,005.00; ARR $300,060.00; net new MRR $500.10; net MRR growth 2.00% (unrounded 2.000000%) — verdict: STEP.
• Smallest customer count for the MRR to STAY at or above $25,000: 511 customers — at 511 customers the figures are MRR $25,039.00; ARR $300,468.00; net new MRR $473.83; net MRR growth 1.89% (unrounded 1.892368%); at the lower neighbor the figures are MRR $24,990.00; ARR $299,880.00; net new MRR $475.30; net MRR growth 1.90% (unrounded 1.901961%); at the upper neighbor the figures are MRR $25,088.00; ARR $301,056.00; net new MRR $472.36; net MRR growth 1.88% (unrounded 1.882813%) — verdict: STEP.
• Smallest ARPU for the net new MRR to STAY at or above $500: $50.00 — at $50.00 the figures are MRR $25,000.00; ARR $300,000.00; net new MRR $500.00; net MRR growth 2.00% (unrounded 2.000000%); at the lower neighbor the figures are MRR $24,995.00; ARR $299,940.00; net new MRR $499.90; net MRR growth 2.00% (unrounded 2.000000%); at the upper neighbor the figures are MRR $25,005.00; ARR $300,060.00; net new MRR $500.10; net MRR growth 2.00% (unrounded 2.000000%) — verdict: STEP.
• Largest churn rate for the net new MRR to STAY at or above $0: 5% churn — at 5% churn the figures are MRR $24,500.00; ARR $294,000.00; net new MRR $0.00; net MRR growth 0.00% (unrounded 0.000000%); at the lower neighbor the figures are MRR $24,500.00; ARR $294,000.00; net new MRR $2.45; net MRR growth 0.01% (unrounded 0.010000%); at the upper neighbor the figures are MRR $24,500.00; ARR $294,000.00; net new MRR −$2.45; net MRR growth −0.01% (unrounded −0.010000%) — verdict: STEP.
• Smallest new customers a month for the net new MRR to STAY at or above $1,000: 36 new customers — at 36 new customers the figures are MRR $24,500.00; ARR $294,000.00; net new MRR $1,029.00; net MRR growth 4.20% (unrounded 4.200000%); at the lower neighbor the figures are MRR $24,500.00; ARR $294,000.00; net new MRR $980.00; net MRR growth 4.00% (unrounded 4.000000%); at the upper neighbor the figures are MRR $24,500.00; ARR $294,000.00; net new MRR $1,078.00; net MRR growth 4.40% (unrounded 4.400000%) — verdict: STEP.
• Smallest ARPU for the ARR to STAY at or above $300,000: $50.00 — at $50.00 the figures are MRR $25,000.00; ARR $300,000.00; net new MRR $500.00; net MRR growth 2.00% (unrounded 2.000000%); at the lower neighbor the figures are MRR $24,995.00; ARR $299,940.00; net new MRR $499.90; net MRR growth 2.00% (unrounded 2.000000%); at the upper neighbor the figures are MRR $25,005.00; ARR $300,060.00; net new MRR $500.10; net MRR growth 2.00% (unrounded 2.000000%) — verdict: STEP.

What the defaults assume

The defaults are one subscription business with 500 paying customers, $49.00 ARPU, 3% monthly churn and 25 new customers a month. They are a starting point, not a benchmark: a consumer app and an enterprise SaaS have very different ARPU and churn, and the right growth for your business is the one that covers your costs and leaves a profit. Change the four numbers to your own and the calculator recomputes instantly. The MRR in 12 months is linear — the same net new MRR every month, no compounding — which is a planning figure, not a forecast: real churn and new customers move every month.

These notes repeat in every explainer section because this page is built to be read start to finish: the defaults are one business’s numbers, not a standard; the ARPU does not change the growth; churn is the lever; and more customers can still mean shrinking.

Output · formula · meaning

Who uses this

• A SaaS founder who reports MRR to investors and wants to know whether the business is growing or shrinking this month.
• A subscription-box owner who tracks churn against new sign-ups and needs the net new MRR before ordering stock.
• A freelancer with retainers who wants the monthly run rate of the retainer book, not just the one-off projects.
• An investor who checks a startup’s MRR, churn and growth before deciding whether the numbers hold up.

Accuracy & limitations

The calculator does the arithmetic exactly — the MRR is customers times ARPU, the ARR is MRR times 12, the net new MRR is new MRR minus churned MRR, and the growth is net new MRR divided by MRR — and every figure on this page is checked against an independent model. What it cannot do is predict your churn: the MRR in 12 months is linear — the same net new MRR every month — and real churn and new customers move every month, so treat it as a planning figure, not a forecast. It also treats every customer as paying the same ARPU — a business with several plans should work out the ARPU as total MRR divided by customers, not guess it. And the growth is undefined when the MRR is $0: with no revenue there is nothing to grow against, and the calculator says so plainly rather than printing a number.

Cite this calculator

Monthly recurring revenue = paying customers × average revenue per user per month; annual recurring revenue = monthly recurring revenue × 12; net new MRR = new MRR − churned MRR; net MRR growth = net new MRR ÷ MRR × 100. On the defaults — 500 paying customers, ARPU $49.00 a month, churn 3% a month, 25 new customers a month — the MRR is $24,500.00, the ARR is $294,000.00, the net new MRR is $490.00 a month and the growth is 2.00%. Smallest ARPU for a $25,000 MRR: $50.00. Smallest customer count for a $25,000 MRR: 511. Smallest ARPU for a $500 net new MRR: $50.00. Largest churn rate for a $0 net new MRR: 5%. Smallest new customers a month for a $1,000 net new MRR: 36. Smallest ARPU for a $300,000 ARR: $50.00. Source: Bright Side Kit, brightoolbox.com.

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