MRR Growth Rate

Date created: Apr 28, 2018  •   Last updated: Feb 6, 2021

What is MRR Growth Rate?

Monthly Recurring Revenue (MRR) Growth Rate is the velocity at which MRR is being added to the business, expressed as a percentage. MRR Growth Rate is often cited as a monthly rate, but it's also possible to express it using an annual timeframe; for example, "we are targeting 10% MRR Growth for April", or "our MRR Growth Rate was 100% last year".

Alternate names: Monthly Recurring Revenue Growth Rate

Formula

ƒ (Total MRR end of period - Total MRR beginning of period) / (Total MRR beginning of period)

How to calculate

A recurring revenue business increased its MRR from $250K at the beginning of the month to $265K at the end of the month. (Total MRR end of period - Total MRR beginning of period) / (Total MRR beginning of period) Net MRR Growth = MRR at the end of the period - MRR at the beginning of the period = $15K $15K / $250K = 6% MRR Growth Rate per month

MRR Growth Rate

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What is a good MRR Growth Rate benchmark?

According to the KeyBanc 2019 SaaS Survey, the average annual MRR Growth Rate across all companies surveyed was 52%.

Annual MRR Growth Rate by ARR

Annual MRR Growth Rate by ARR

KeyBanc, Jan 2019
Annual MRR Growth Rate by ARPA

Annual MRR Growth Rate by ARPA

KeyBanc, Jan 2019
Annual MRR Growth Rate by Primary Sales Channel

Annual MRR Growth Rate by Primary Sales Channel

KeyBanc, Jan 2019
Annual MRR Growth Rate by Sales & Marketing Spend as a Percentage of Revenue

Annual MRR Growth Rate by Sales & Marketing Spend as a Percentage of Revenue

KeyBanc, Jan 2019
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More about this metric

Monthly Recurring Revenue (MRR) is the total amount of recurring revenue generated by a subscription-based business each month. The change in MRR compared to a previous period in time gives the MRR Growth Rate.

MRR Growth Rate measured over time helps you track the rate at which your business is growing, and lets you rectify slow growth or drawn-out declines in growth. To improve your MRR Growth Rate, it is helpful to focus on acquisition along with other factors such as retention, expansion, and pricing.