📉 SaaS Churn Calculator
Churn is the silent killer of SaaS. Measure logo churn and revenue churn to see how fast the bucket leaks.
How Churn Measurement Works
Churn rate is the share of customers (or revenue) lost in a period. Two flavors matter: logo churn (customers lost) and revenue churn (MRR lost). Revenue churn is the money metric — losing small accounts while keeping big ones shows up here.
The Formulas
Revenue Churn = Lost MRR ÷ Starting MRR × 100
Retention = 100% − Churn
Benchmarks (monthly): SMB SaaS 3–7% logo churn is common; enterprise <1–2%. The magic threshold is net revenue retention ≥100% — expansion from remaining customers fully offsets churn. Annualize monthly churn × 12 for yearly, but compounding makes the true annual figure higher.
Worked Example
1,000 customers, 40 lost → logo churn = 4%, retention 96%. MRR churn: $1,500 ÷ $50,000 = 3%. With 80 new customers added, net growth = +40 (1,040 end). Break-even needs just 40 new customers — this business grows comfortably.
Finding and Fixing Your Churn
Split churn into voluntary (customer chose to leave) and involuntary (failed payments) — dunning management and card-updater services routinely recover 20–40% of involuntary churn, the cheapest growth you'll ever buy. Voluntary churn clusters in the first 90 days: onboarding that drives users to their first value moment (the "aha") within days cuts early churn dramatically. Structural retention beats persuasion: annual plans (often at 2 months free) collapse 12 monthly cancel decisions into one, typically halving logo churn. Run exit surveys on every cancellation and code the reasons — "too expensive" usually means "didn't get value," which is a product/onboarding problem, not a pricing one. Finally, remember expansion offsets churn: a customer who upgrades 2× before canceling contributed net-positive — optimize net revenue retention, not just logo retention.
Set churn alerts, not just reports: instrument leading indicators — login frequency drops, feature usage declines, support ticket spikes — and trigger human outreach before the cancellation click. Save plays (discounts, training, success calls) recover 15–30% of at-risk accounts, but only if they fire weeks before renewal, not after.
Frequently Asked Questions (FAQs)
What is a good churn rate for SaaS?
Monthly: under 2% is excellent, 3–5% typical for SMB, 5–7%+ is a red flag. Annual enterprise churn under 10% is strong. Context matters — price point and contract length drive huge differences.
Logo churn vs revenue churn?
Logo churn counts customers; revenue churn counts dollars. If big accounts stay and small ones leave, revenue churn looks better — track both, optimize revenue churn.
What is net revenue churn?
Gross churn minus expansion (upsells) from remaining customers. Negative net churn (expansion > churn) is the hallmark of best-in-class SaaS.
How do I reduce churn?
Onboarding that drives time-to-value, usage monitoring with save plays, annual plans (structural retention), and exit interviews that feed the roadmap.
Should churn be monthly or annual?
Measure monthly for operations, report annual for strategy. Never just multiply monthly × 12 — compounding means 5% monthly ≈ 46% annual, not 60%.
Last updated: September 2026