MRR
Monthly Recurring Revenue — the predictable income a business earns every month from active subscriptions or retainer contracts.
MRR (Monthly Recurring Revenue) is the total subscription or retainer income a business can count on receiving every month. It is the foundational metric for any recurring-revenue business — SaaS companies, newsletter operators, service businesses on monthly retainers, and content subscription products all use MRR to measure health and growth.
How to calculate MRR: Multiply the number of active paying customers by their average monthly charge. If you have 10 clients each paying $150/mo, your MRR is $1,500.
Why MRR matters more than one-off revenue: MRR is predictable — you know roughly what next month will bring. One-off project income is unpredictable. Businesses with high MRR can plan, invest, and grow with confidence; businesses relying entirely on project income cannot.
Key MRR movements to track: - New MRR: Revenue from new customers this month - Expansion MRR: Existing customers upgrading to higher plans - Churned MRR: Revenue lost from cancellations - Net New MRR: New + Expansion − Churned
MRR vs ARR: ARR (Annual Recurring Revenue) is simply MRR × 12. ARR is commonly used for annual contracts; MRR for monthly billing.
Example
You run 5 Zapier automation retainers at $200/mo each. Your MRR is $1,000. Add one client and it becomes $1,200. Lose one and it drops to $800. MRR makes the income trajectory immediately visible.
Related terms
SaaS
Software as a Service — software delivered over the internet on a subscription basis, where the provider hosts and maintains the product.
Churn
The rate at which customers cancel their subscriptions or stop paying — the primary measure of retention health for any recurring-revenue business.
Retainer
A recurring payment arrangement where a client pays a fixed monthly fee for ongoing access to a service or a defined scope of work.
Passive Income
Income that continues to arrive without ongoing active work — generated by assets, products, or systems set up previously.