Tools > MRR / ARR Calculator
MRR / ARR Calculator
Convert between monthly and annual recurring revenue, project your MRR 12 months forward, and model the impact of expansion, contraction, and churn on your revenue base.
Total recurring subscription revenue per month. Excludes one-off payments.
Total paying customers. Used to calculate ARPU. Leave at 0 to skip.
$42,000 x 12 = $504.0k ARR
Your MRR today.
Compound monthly MRR growth rate.
Number of months to project. Max 60.
| Month | MRR | ARR | MoM Growth | |
|---|---|---|---|---|
| Month 1 | $46.2k | $554.4k | +10.0% | |
| Month 2 | $50.8k | $609.8k | +10.0% | |
| Month 3 | $55.9k | $670.8k | +10.0% | |
| Month 4 | $61.5k | $737.9k | +10.0% | |
| Month 5 | $67.6k | $811.7k | +10.0% | |
| Month 6 | $74.4k | $892.9k | +10.0% | |
| Month 7 | $81.8k | $982.2k | +10.0% | |
| Month 8 | $90.0k | $1.1M | +10.0% | |
| Month 9 | $99.0k | $1.2M | +10.0% | |
| Month 10 | $108.9k | $1.3M | +10.0% | |
| Month 11 | $119.8k | $1.4M | +10.0% | |
| Month 12 | $131.8k | $1.6M | +10.0% |
MRR at the start of this month from existing customers.
MRR from new customers acquired this month.
MRR gained from upgrades and upsells this month.
MRR lost to downgrades this month.
MRR lost to cancellations this month.
MRR from previously churned customers who returned.
$42.0k + $5.0k + $2.0k + $0 - $500 - $1.2k = $47.3k
MRR vs ARR: what's the difference?
Monthly Recurring Revenue (MRR) is the normalised monthly value of all active subscriptions. Annual Recurring Revenue (ARR) is MRR multiplied by 12. They represent the same revenue base - just measured at different time horizons.
Most SaaS companies under $10M use MRR day-to-day because it is more responsive to change. Most investor conversations happen in ARR terms because it is easier to compare across companies and link to valuation multiples.
ARR = MRR x 12
MRR = ARR / 12
If a customer pays $1,200/year, their MRR contribution is $100. Their ARR contribution is $1,200.
Note: ARR is not the same as annual revenue. A company with $500k MRR has $6M ARR - but only has $6M in annual revenue if every customer renews and no one churns. ARR is a forward-looking metric representing run-rate, not a backward-looking measure of cash collected.
MRR growth rate benchmarks (2025)
19-21%
Median annual ARR growth for private SaaS companies in 2025.
That translates to roughly 1.5-1.6% compound monthly growth. Early-stage startups targeting venture funding need to be growing much faster - 10-15% monthly is the typical seed-stage benchmark.
| Monthly Growth | Annual Equivalent | Benchmark |
|---|---|---|
| 15%+ MoM | ~435% annual | Exceptional - Hypergrowth. Rare outside early-stage or AI-native. |
| 10-15% MoM | 214-435% annual | Strong - Seed / pre-Series A target. VC-fundable trajectory. |
| 5-10% MoM | 79-214% annual | Healthy - Good for post-Series A. Sustainable compounding. |
| 2-5% MoM | 27-79% annual | Moderate - Typical for scaling companies. Track trend carefully. |
| <2% MoM | <27% annual | Slow - Median private SaaS range. May indicate market saturation or GTM issues. |
| ARR Stage | Target Annual Growth | Notes |
|---|---|---|
| $0 - $1M ARR | 3x+ (200%+) | T2D3 rule applies here |
| $1M - $10M ARR | 2x+ (100%+) | VC Series A / B expectation |
| $10M - $50M ARR | 80-100% | Growth efficiency becomes critical |
| $50M - $100M ARR | 50-80% | Rule of 40 comes into focus |
| $100M+ ARR | 30-50% | IPO-readiness range |
The five types of MRR movement
Ending MRR is the sum of five distinct movements. Tracking each separately is essential for understanding where your revenue is actually coming from - and where it is leaking.
Ending MRR = Starting MRR + New MRR + Expansion MRR + Reactivation MRR - Contraction MRR - Churned MRR
Two of these grow your base. Three reduce it. Only expansion is in your control without acquiring new customers.
| Type | What it is | Target |
|---|---|---|
| New MRR | Revenue from newly acquired customers | Primary growth lever |
| Expansion MRR | Upgrades, upsells, seat additions | Should offset churn at minimum |
| Reactivation MRR | Returning churned customers | Bonus - do not rely on it |
| Contraction MRR | Downgrades and plan reductions | Keep below 0.5% monthly |
| Churned MRR | Cancellations | Keep below 1% monthly |
Frequently asked questions
Why VeryCreatives?
Building a SaaS product?
Building toward your first $1M ARR?
VeryCreatives builds SaaS products for non-tech founders - from MVP to a product that acquires and retains customers. We've done it across legaltech, fintech, and more.