Expansion Ratio
Expansion MRR relative to new-customer MRR, not a share of total growth.
Put this metric to work: explore FlowMRR's MRR movement analytics to track revenue movements, retention and forecasts from your own account.
MRR generated by upsells, seat expansion, usage growth, or plan upgrades divided by new-logo MRR. This ratio can exceed 100%; it is not expansion's share of total growth. It shows whether growth has a land-and-expand engine or depends mostly on acquisition.
Formula
Expansion Ratio = Expansion MRR ÷ New MRRWorked example
Expansion MRR $12,000, New MRR $40,000 → Expansion Ratio = 30%.
Illustrative comparisons
Growth mixThese unsourced ranges are illustrative scenarios, not measured industry benchmarks, percentiles or recommended targets. Their qualitative labels are editorial interpretations. Compare your own cohorts using the same segment, period, currency and measurement basis.
Why it matters
Expansion revenue is cheaper than new revenue because the customer is already acquired. A rising Expansion Ratio usually means pricing, seats, usage, or packaging are working. A low ratio is not fatal for early SaaS, but at scale it means growth gets expensive because every dollar must come from a new customer.
Common mistakes
- Counting price increases as expansion without separating true usage or seat growth.
- Comparing self-serve SMB and enterprise expansion ratios directly.
- Ignoring contraction alongside expansion; pair this with NRR or Net New MRR.