The total predictable subscription revenue your business earns in a single month, normalised to a monthly value.
MRR = Σ (active subscriptions × normalised monthly price)
40 customers on a £50/mo plan and 10 customers on a £1,200/yr plan (£100/mo equivalent).
(40 × £50) + (10 × £100) = £2,000 + £1,000 = £3,000 MRR
MRR is the heartbeat of any subscription business. It measures the recurring revenue you can count on every month, stripped of one-off charges like setup fees, professional services, or one-time purchases. Only the recurring portion counts.
To get an accurate figure you normalise every plan to its monthly equivalent. An annual plan billed at £1,200 contributes £100 of MRR, not £1,200 in the month it was charged. The same logic applies to quarterly and multi-year terms.
MRR moves in five ways: new MRR (fresh customers), expansion MRR (upgrades and add-ons), contraction MRR (downgrades), churned MRR (cancellations), and reactivation MRR (returning customers). Tracking each movement separately is what turns a single number into something you can act on.
MRR is the single best gauge of momentum. It smooths out lumpy annual contracts into a steady monthly signal, lets you compare months like-for-like, and feeds nearly every other SaaS metric — ARR, growth rate, LTV, and forecasts all start here.
Early-stage SaaS targeting venture scale often aim for 10–20% month-over-month MRR growth; mature businesses settle into steadier single-digit monthly growth.
No. MRR is strictly recurring. Setup fees, one-off professional services, and one-time purchases are excluded — only the predictable subscription portion counts.
Annual plans are normalised to their monthly equivalent. A £1,200 annual plan adds £100 to MRR each month, not £1,200 in the month it was billed. Mowt does this normalisation automatically.
ARR is simply MRR multiplied by 12. MRR is the monthly view; ARR is the annualised run-rate. See our ARR definition.
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