~2 min read
Churn is the single biggest drag on SaaS growth. Every percentage point of monthly churn compounds — a business churning 5% per month loses over 46% of its MRR base annually. This calculator shows you exactly how much revenue disappears each month and year, how much new MRR you must acquire just to stay flat, and what target requires hitting a given growth rate.
What does monthly churn rate mean?
Monthly churn rate is the percentage of paying subscribers who cancel in a given month. A 3% monthly churn rate means 3 out of every 100 subscribers cancel — leaving 97 active at month-end. Over 12 months, that compounds to an annual retention rate of (0.97)^12 = 69.4%, so you lose over 30% of subscribers annually from 3% monthly churn.
How to use this calculator
Enter your current MRR, your monthly churn rate (%), and the target monthly growth rate you want to achieve. The calculator outputs:
- Monthly revenue lost — churned MRR each month
- Annual revenue lost — the 12-month drag on revenue
- New MRR to break even — how much new MRR/mo to stay flat
- New MRR to hit growth target — acquisition + churn offset combined
- Average customer lifetime — months at this churn rate
Churn benchmarks for SaaS
| Monthly churn | Annual equivalent | Verdict |
|---|---|---|
| < 1% | < 11% | Excellent — enterprise SaaS range |
| 1–3% | 11–30% | Good — typical SMB SaaS |
| 3–5% | 30–46% | Needs improvement |
| 5–10% | 46–72% | Critical — acquisition can't outrun this |
| > 10% | > 72% | Business model issue, not a growth problem |
The "leaky bucket" growth problem
The hardest insight from this calculator: at 5% monthly churn, you need to grow new MRR by 5% just to stay flat. A 10% monthly growth target requires acquiring 15% of MRR in new subscriptions each month. This is why reducing churn has 3× the financial impact of the equivalent increase in acquisition spend.
For reducing churn, focus first on activation (users who never used key features cancel first), then on pricing alignment (users on the wrong plan for their usage), then on proactive cancellation flows.