Net New MRR is the net change in Monthly Recurring Revenue in a period — new plus expansion minus contraction minus churn.
What is Net New MRR?
Net New MRR decomposes growth into its four levers. Two companies can post the same growth while one is acquisition-driven and fragile, the other expansion-driven and durable. The breakdown tells you which.
How to calculate Net New MRR
Worked example
In a month you add $20,000 new and $8,000 expansion, but lose $3,000 to downgrades and $5,000 to churn. Net New MRR = $20,000 + $8,000 − $3,000 − $5,000 = $20,000.
What's a good Net New MRR?
Best-in-class SaaS generates a growing share of net new MRR from expansion — often 30%+ at scale — because expansion is cheaper than new-logo acquisition.
Frequently asked questions
What's a healthy mix of net new MRR?
There's no single answer, but a rising expansion contribution and shrinking churn contribution is the signature of a durable business.
How does Net New MRR relate to the MRR waterfall?
The MRR waterfall is the visual of exactly these components — starting MRR, plus new and expansion, minus contraction and churn, equals ending MRR.
Related metrics
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