Model a SaaS price increase before you ship it. See the net MRR change after churn, the churn at which the rise breaks even, and whether the numbers say go.
Your current monthly recurring revenue.
How much you're raising the price on the affected base.
Share of affected revenue that cancels because of the rise.
Portion of MRR the increase applies to. 100% = whole book.
Net MRR change at different churn assumptions, holding your increase and affected share fixed. Watch the cliff at breakeven.
| Churn from increase | New MRR | Net MRR change | Verdict |
|---|
churn before it nets zero
churn before it nets zero
churn before it nets zero
A price increase pushes affected revenue up by the increase, then loses the share that cancels. The two forces cancel out at a single churn rate — the breakeven. Below it you net more MRR; above it the rise costs you.
The clean way to remember it: a rise of r breaks even when the cancelling share equals r / (1 + r). Bigger rises absorb more churn, but the curve flattens fast — doubling the increase doesn't double the tolerance.
Breakeven churn = increase / (1 + increase) Example: a 20% rise (increase = 0.20):
If your expected churn sits comfortably below the breakeven, the rise nets positive even with room for error. Go across the board, give clear notice, and anchor the increase to value you've shipped. The model ignores expansion, so the real result is usually better.
If churn lands near or above breakeven, the rise risks shrinking MRR. Soften it: a smaller increase, grandfathering existing customers, or a phased rollout buys retention while still capturing some uplift. Segment so your most price-sensitive cohort isn't hit hardest.
Up to the breakeven churn, which is increase / (100 + increase). A 20% rise breaks even at about 16.7% churn of the affected revenue — below that you net more MRR, above it you net less. The bigger the increase, the more churn it can absorb, but the relationship flattens: a 10% rise tolerates ~9.1% churn while a 50% rise tolerates ~33.3%.
It's the share of affected revenue that cancels. The model raises prices on the affected base, then removes the cancelling share. If you only raise prices on part of your book, apply the churn to that slice — the unaffected revenue carries on unchanged. The breakeven percentage itself doesn't depend on how much of the base you touch.
No, and that's deliberate. The model only counts the downside (cancellations) and the direct uplift, so it's a conservative floor. In practice a price increase often pulls some accounts up via plan changes or seat growth, and reactivation can recover part of the churn. Treat the net change here as the worst realistic case, then add expansion on top.
Grandfathering applies the new price only to new customers and protects existing relationships, which lowers churn but delays the revenue uplift. If your modelled churn sits above breakeven, grandfathering (or a phased rollout with notice) is usually the safer path. If you're well under breakeven, a clean across-the-board rise captures the upside faster.
It varies by segment and notice given, but well-run B2B SaaS increases of 10-20% often see low single-digit incremental churn when paired with clear communication and added value. Self-serve and price-sensitive segments react harder. The honest answer is to test the table below: if you'd still net positive even at double your expected churn, the risk is contained.
Most SaaS companies revisit pricing annually and increase for existing customers every one to two years, tied to shipped value. Frequent or surprise increases erode trust and spike churn. Anchor each rise to new capabilities, give 30-60 days' notice, and segment so your most price-sensitive cohort isn't hit hardest.
Modelling is step one. Mowt tracks the real MRR, churn and expansion impact of every pricing move straight from Stripe, updated daily — so you know within days whether the rise landed.
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