Question 1

What is MRR?

Accepted Answer

Monthly Recurring Revenue (MRR) is the predictable revenue a SaaS or subscription business expects to receive every month. It normalizes all subscription plans into a single monthly figure, making it the standard metric for measuring business size, growth rate, and momentum. MRR excludes one-time charges, services revenue, and non-recurring fees.

Question 2

What's the difference between MRR and revenue?

Accepted Answer

Revenue is the total amount a business earns in a period and includes everything — subscriptions, one-time sales, professional services, etc. MRR focuses specifically on the recurring portion of revenue from active subscriptions. For SaaS businesses, MRR is considered a more meaningful measure of business health because it reflects predictable, committed income.

Question 3

What chart type works best for MRR?

Accepted Answer

A line chart is the most common and effective choice for MRR because it shows the growth trajectory clearly. An area chart (filled line chart) emphasizes the cumulative growth even more. For MRR composition (new MRR, expansion MRR, churned MRR), a stacked bar chart is better for showing the contribution of each component.

Question 4

What is a good MRR growth rate?

Accepted Answer

Early-stage SaaS companies aiming for fast growth typically target 10–20% month-over-month MRR growth. This compounds to roughly 3–7x annual growth. More established companies aim for 5–10% monthly growth. These are rough benchmarks — the right target depends heavily on your market, business model, and stage.

Question 5

What is Net New MRR?

Accepted Answer

Net New MRR = New MRR (from new customers) + Expansion MRR (from upgrades) − Churned MRR (from cancellations and downgrades). It tells you how much your MRR actually grew in a given month after accounting for losses. A positive Net New MRR means growth; negative means contraction even if your headline MRR looks stable.

MRR Chart

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FAQ: MRR Chart