🚀 Revenue Forecast

Forecasting Startup Revenue (MRR/ARR)

For SaaS and subscription businesses, predicting future revenue is key to survival and fundraising. It relies on your growth rate and churn rate.

Key Metrics

• MRR: Monthly Recurring Revenue.
• ARR: Annual Recurring Revenue (MRR × 12).
• Churn: The % of customers who cancel each month.
• Growth Rate: The % increase in new customers.

The Compound Effect

Small changes in churn have massive long-term effects. A 5% monthly churn means you lose ~46% of your customer base every year if you don't acquire new ones.

FAQ

What is Net Negative Churn?

Ideally, existing customers upgrade or add seats faster than others cancel. This means revenue grows even with zero new sales. This is the holy grail of SaaS.