Better onboarding, engagement monitoring, customer success.

Logo churn vs revenue churn?

Track both for product-market fit and financial health.

How does churn affect valuation?

Low churn commands higher valuation multiples.

Business

Churn Rate Calculator

Calculate monthly and annual customer churn rate, MRR churn, and average customer lifetime from your subscription data.

Quick Answer

Monthly Churn = Customers Lost ÷ Starting Customers × 100. Losing 50 of 1,000 customers = 5% monthly churn = ~46% annual churn.

Customer Churn

Starting Customers

Customers Lost This Month

Revenue Churn (optional)

Starting MRR ($)

MRR Lost ($)

Results

5.00%

Monthly Churn

46.0%

Annual Churn

6.00%

MRR Churn

20.0 mo

Avg Customer Lifetime

About the Churn Rate Calculator

Churn rate measures the percentage of customers who stop using your product or service during a given time period. For subscription businesses, churn is arguably the single most important metric because it determines long-term sustainability. Even small differences in monthly churn compound dramatically over a year.

Monthly vs Annual Churn

Monthly churn and annual churn are not linearly related. A 5% monthly churn rate does not equal 60% annual churn. The correct calculation is: Annual Churn = 1 - (1 - Monthly Churn)^12. This gives approximately 46% annual churn for 5% monthly. Understanding this compounding effect is critical for accurate forecasting and investor communication.

Customer Churn vs Revenue Churn

Customer churn counts the number of accounts lost. Revenue churn measures the dollar amount lost. These can differ significantly if your customers have varying plan sizes. Losing ten $10/month customers is very different from losing one $100/month enterprise account. Revenue churn, also called MRR churn, often matters more for financial planning.

Average Customer Lifetime

Average customer lifetime is the inverse of your churn rate. At 5% monthly churn, the average customer stays 20 months (1/0.05). At 2% monthly churn, that jumps to 50 months. This metric directly connects to customer lifetime value and determines how much you can afford to spend on acquisition.

Frequently Asked Questions

What is a good churn rate for SaaS?

For B2B SaaS, 3-5% annual churn is excellent. Monthly churn under 1% is considered strong. B2C subscription businesses typically see higher churn, with 5-7% monthly being common. The best SaaS companies achieve net negative revenue churn through expansion revenue.

What is net revenue churn?

Net revenue churn accounts for expansion revenue from existing customers (upgrades, cross-sells) in addition to lost revenue. If you lose $3,000 MRR but gain $4,000 from upgrades, your net revenue churn is negative 2%, which is the gold standard for SaaS businesses.

How do I reduce churn?

Focus on onboarding to ensure customers reach their 'aha moment' quickly. Monitor engagement metrics to identify at-risk accounts. Build a customer success function for high-value accounts. Improve your product based on cancellation feedback. Offer annual plans with discounts to reduce monthly decision points.

Should I track logo churn or revenue churn?

Track both. Logo churn tells you about product-market fit and customer satisfaction. Revenue churn tells you about financial health. A company can have high logo churn but negative net revenue churn if enterprise customers expand enough to offset small account losses.

How does churn affect company valuation?

Churn is one of the top metrics investors evaluate. High churn suggests product-market fit issues and makes growth unsustainable since you need to replace lost customers before growing. Companies with low churn and net negative revenue churn command significantly higher valuation multiples.