Churn & retentionMetric 9 of 35

Gross MRR Churn

Revenue lost to cancels and downgrades, before counting expansion.

How much MRR walked out the door this period, before any expansion offsets it. Gross churn is the worst-case retention view — useful precisely because it strips away the comforting noise of upsells.

Formula

Gross MRR Churn = (Churned MRR + Contraction MRR) ÷ MRR at Start

Worked example

Start with $100,000 MRR. Lose $3,000 to cancels, $500 to downgrades → Gross MRR Churn = 3.5%.

Benchmark

B2B SaaS monthly

Top quartile

< 1%

Median

1–2.5%

Concerning

> 4%

Why it matters

Gross MRR churn caps your ceiling honestly. Net retention can mask trouble — a few big expansion deals can hide widespread downgrades. Gross churn is the pure 'are we losing money on existing accounts?' number. Run both, but trust gross to tell you the unvarnished truth.

Common mistakes

Reporting only net retention to make the picture look better.
Forgetting to include downgrades — only counting full cancels understates the bleeding.
Calculating on customer count instead of revenue (that's logo churn, not MRR churn).

Tracked in FlowMRR

Retention → Churn Split card: gross vs. net MRR churn, side by side.

Track Gross MRR Churn in FlowMRR