What is Pause MRR and Cancellation/Churn MRR?

Modified on: Sat, 26 Jun, 2021 at 11:44 PM

Pause MRR

This is the monthly recurring revenue of subscriptions that are in paused state. Subscriptions placed on pause will not be accounted for Churn, hence your reports will be accurate and will reflect the right numbers. 

Cancellation MRR or Churn MRR

A component in the calculation of Contraction MRR, Churn MRR, or Cancellation MRR takes into account the MRR lost due to canceled or churned subscriptions. 

Cancellation MRR = Total sum of the MRR lost for all subscriptions which were cancelled in a specific period

For example, if 5 of your subscriptions with $100 MRR each got canceled this month, then your cancellation MRR would be $500. 

Churn is useful in understanding how well your product stays relevant to your customers’ needs. During the early stages of a subscription business, a high or a rising churn MRR or cancellation MRR may indicate poor product-market fit, while a similar trend during later stages may point towards a recent marketing campaign that brought in customers with the wrong promise.

M
Monica is the author of this solution article.

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