How It Works
Three simple steps to get accurate calculations
1
Enter Current Metrics
Input your current Monthly Recurring Revenue (MRR) and optionally your Average Revenue Per User (ARPU) to enable customer metrics.
2
Set Growth Assumptions
Define your expected monthly growth rate from new customers and your monthly churn rate from customer losses.
3
Choose Time Horizon
Select how many months into the future you want to project your revenue growth (1-120 months).
4
Analyze Projections
Review your projected MRR, total revenue, customer growth metrics, and month-by-month breakdown with actionable insights.
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Frequently Asked Questions
How is recurring revenue growth calculated?
The calculator applies your monthly growth rate to add new revenue, then subtracts revenue lost due to churn. This net growth compounds each month: New MRR = Previous MRR × (1 + Growth Rate - Churn Rate). The calculation accounts for the reality that both growth and churn happen simultaneously.
What is a good monthly growth rate for recurring revenue?
Monthly growth rates vary by business stage and industry. Early-stage SaaS companies often see 5-20% monthly growth, while mature companies typically see 2-10%. The key is ensuring your growth rate consistently exceeds your churn rate to maintain positive momentum.
How accurate are long-term revenue projections?
Projections become less accurate over longer time horizons due to market changes, competition, and business evolution. We recommend using 6-18 month projections for operational planning and longer projections for strategic scenario analysis only.
What is considered a healthy churn rate?
Monthly churn rates vary by industry and customer segment. B2B SaaS typically sees 3-8% monthly churn, while B2C subscriptions may see 5-15%. Lower churn rates generally indicate better product-market fit and customer satisfaction.
Should I include one-time fees in MRR calculations?
No, MRR should only include predictable, recurring revenue streams like monthly subscriptions, retainers, or contracted services. One-time setup fees, consulting, or variable usage fees should be tracked separately as they don't represent recurring business.
How does ARPU help with revenue projections?
Average Revenue Per User (ARPU) enables customer-level analytics by converting revenue metrics to customer counts. This helps you understand how many customers you need to acquire and retain to hit revenue targets, making your projections more actionable.
What if my churn rate exceeds my growth rate?
Negative net growth means your business is shrinking. Focus on reducing churn through improved onboarding, customer success programs, and product improvements, while simultaneously increasing customer acquisition through marketing and sales investments.
Can I model different pricing tiers or customer segments?
This calculator provides a simplified view assuming average metrics across your entire customer base. For complex scenarios with multiple pricing tiers or customer segments, consider running separate calculations for each segment or using specialized cohort analysis tools.
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Results are estimates for informational purposes only. Consult professionals for important decisions.