Monthly Recurring Revenue(MRR)

MRR is the most important metric for any business with a subscription model. It shows how much money is guaranteed to come in every month, without one-time deals or variable revenue. You calculate MRR by adding up all monthly subscription amounts. For annual contracts, divide the amount by 12. A healthy MRR grows every month through new customers (New MRR), upsell with existing customers (Expansion MRR), minus customers who stop (Churned MRR). The MRR growth rate is crucial: 10% growth per month means doubling in 7 months. At 5% growth that takes 14 months. Most successful SaaS companies are between 5-15% MRR growth per month in the growth phase. MRR also gives you grip on your business: you know exactly what's coming in and can plan ahead. It makes financing easier because investors see exactly how predictable your business is. Note: revenue from projects or implementation doesn't count. Only pure recurring subscriptions count.