See your monthly and annualized customer churn — and exactly how much revenue it's costing you.
A chunk of "churn" is usually involuntary — failed cards and broken dunning that a one-hour Stripe audit can surface.
Get the $19 Stripe Billing Audit or try the free MRR Leak CalculatorMonthly customer churn is simple division: customers lost during the month divided by customers you had at the start, times 100. Lose 25 of 500 customers and your monthly churn is 5%.
Annualized churn is where most founders get the math wrong. You can't multiply monthly churn by 12, because churn compounds against a shrinking base. The correct formula is 1 − (1 − monthly churn)12. That 5% monthly rate compounds to about 46% per year — meaning nearly half your customer base disappears in twelve months unless new signups replace them.
The revenue figures multiply lost customers by your average revenue per customer. Monthly revenue lost is the MRR that walked out the door this month; yearly revenue lost is that monthly bleed times twelve — a conservative floor, since it ignores compounding and any upgrades those customers would have made.
The severity bands reflect common SaaS benchmarks: under 3% monthly churn is sustainable for most SMB products, 3–7% means growth is fighting a strong headwind, and above 7% you're refilling a leaking bucket faster than almost any acquisition channel allows. Before spending more on acquisition, check how much of that churn is involuntary — failed payments are usually the cheapest churn to fix.
Monthly customer churn rate is the number of customers lost during the month divided by the number of customers you had at the start of the month, multiplied by 100. For example, losing 25 of 500 customers is a 5% monthly churn rate.
Because churn compounds. Each month you lose a percentage of a shrinking base, so annualized churn is calculated as 1 minus (1 minus monthly churn) to the 12th power. A 5% monthly churn rate compounds to roughly 46% annual churn, not 60%.
For SMB-focused SaaS, 3–5% monthly churn is common but worth improving. Under 3% monthly is generally healthy, 3–7% is a warning zone, and anything above 7% monthly is critical — at that rate you replace more than half your customer base every year just to stand still.