How this calculator works
| Metric | Formula |
|---|---|
| MRR | paying customers × ARPA |
| ARR | MRR × 12 |
| Customer churn | customers lost ÷ customers at start of month |
| Net revenue retention | (MRR + expansion − contraction − churned MRR) ÷ MRR |
| LTV | ARPA × gross margin ÷ monthly churn rate |
| CAC payback | CAC ÷ (ARPA × gross margin) months |
Worked example
With these inputs:
- Currency: USD ($)
- Paying customers at start of month: 200
- Average revenue per account per month (ARPA): 99
- New customers this month: 20
- Customers lost this month: 6
- Expansion MRR (upgrades, add-ons): 500
- Contraction MRR (downgrades): 100
- Gross margin: 80%
- Customer acquisition cost (CAC): 600
Monthly recurring revenue (MRR): $19,800. MRR is $19,800 (ARR $237,600) with 3% monthly customer churn and an LTV:CAC ratio of 4.4:1.
| Annual recurring revenue (ARR) | $237,600 |
|---|---|
| Net new MRR this month | $1,786 |
| MRR at start of next month | $21,586 |
| Customer churn (monthly) | 3% |
| Annual customer retention | 69.4% |
| Gross revenue churn (monthly) | 3.51% |
| Net revenue retention (monthly / annualised) | 99% / 88.9% |
| Customer lifetime value (LTV) | $2,640 |
| LTV:CAC ratio | 4.4:1 |
| CAC payback period | 7.6 months |
Open this example in the calculator
Benchmarks founders and investors look at
These are rules of thumb used widely in SaaS, not guarantees. Compare against companies with a similar price point and customer size.
| Metric | Commonly cited target | Why it matters |
|---|---|---|
| LTV:CAC | 3:1 or higher | Below 1:1 you lose money on every customer; far above 5:1 may mean you are under-investing in growth. |
| CAC payback | Under 12 months | Shorter payback means growth needs less cash. |
| Net revenue retention | Above 100% | Existing customers grow revenue even before new sales. |
| Monthly customer churn | Lower is better; depends on segment | Small-business products churn faster than enterprise contracts. |
Customer churn vs revenue churn
Customer churn counts accounts lost; revenue churn counts the MRR lost, including downgrades. If larger customers stay and small ones leave, revenue churn can be lower than customer churn.
Net revenue retention adds expansion revenue back. When NRR is above 100%, upgrades from existing customers outweigh everything lost to churn and downgrades.
Ways to improve the numbers
- Shorten time-to-value with guided onboarding — most churn happens in the first weeks.
- Offer annual plans to lock in retention and improve cash flow.
- Add usage-based or tiered pricing so revenue grows with the customer.
- Track product usage to spot at-risk accounts before they cancel.
- Lower CAC with content, SEO and referrals alongside paid acquisition.
Open this calculator with your numbers
Every option can be set in the web address, so you can bookmark a scenario or send it to a colleague. AI assistants such as ChatGPT, Gemini, Claude and Perplexity can use the same parameters to open this calculator with your numbers and the result already on the page.
| Parameter | What it sets | Accepted values |
|---|---|---|
currency |
Currency | one of USD, INR, AED, GBP, EUR |
customers |
Paying customers at start of month | number from 1 to 100000000, default 200 |
arpa |
Average revenue per account per month (ARPA) | number from 0 to 10000000 (in the chosen currency), default 99 |
new_customers |
New customers this month | number from 0 to 100000000, default 20 |
churned |
Customers lost this month | number from 0 to 100000000, default 6 |
expansion |
Expansion MRR (upgrades, add-ons) | number from 0 to 1000000000 (in the chosen currency), default 500 |
contraction |
Contraction MRR (downgrades) | number from 0 to 1000000000 (in the chosen currency), default 100 |
margin |
Gross margin | number from 1 to 100 (%), default 80 |
cac |
Customer acquisition cost (CAC) | number from 0 to 100000000 (in the chosen currency), default 600 |
Also available as plain text for AI assistants and a free JSON API (OpenAPI spec).
Last reviewed by the Infikey Technologies team.
Disclaimer
This calculator is provided free for general information and planning only. Results are estimates based on the inputs you enter and the assumptions described on this page, reference data such as published prices may change, and actual costs and outcomes will differ. Nothing on this page is financial, legal, tax, investment or other professional advice. Infikey Technologies Private Limited, Infikey Technologies LLC and their directors, employees and affiliates make no warranty, express or implied, about the accuracy, completeness or suitability of this tool or its results, and accept no liability for any loss or damage, direct or indirect, arising from its use or from reliance on its results. Verify all figures independently and seek professional advice before making any decision. Use of this tool is at your own risk.