What is MRR (Monthly Recurring Revenue)?
The predictable revenue your business earns each month from active subscriptions.
Why It Matters
MRR is the key metric for subscription businesses, showing how revenue grows or shrinks over time.
Real-World Example
Having 200 customers on a $50/month plan gives you $10,000 MRR.
“Understanding terms like MRR (Monthly Recurring Revenue) matters because it helps you have better conversations with developers and make smarter decisions about your software. You do not need to be technical. You just need to know enough to ask the right questions.”
Related Terms
ARR (Annual Recurring Revenue)
The predictable revenue your business earns per year from active subscriptions, typically MRR multiplied by 12.
Churn Rate
The percentage of customers who stop using your product or cancel their subscription in a given period.
LTV (Lifetime Value)
The total revenue you can expect from a single customer over the entire time they remain a customer.
SaaS
Software as a Service - applications you access online and pay for through subscriptions
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Related Terms
SaaS
Software as a Service - applications you access online and pay for through subscriptions
Churn Rate
The percentage of customers who stop using your product or cancel their subscription in a given period.
LTV (Lifetime Value)
The total revenue you can expect from a single customer over the entire time they remain a customer.
ARR (Annual Recurring Revenue)
The predictable revenue your business earns per year from active subscriptions, typically MRR multiplied by 12.
Product-Market Fit
The point where your product satisfies a strong market demand and customers actively want it.
Lean Startup
A methodology for building businesses by rapidly testing ideas with real customers and iterating based on feedback.