Frequently Asked Questions
What's a healthy churn rate?
Varies by segment: SMB SaaS 3-7% monthly, mid-market 1-2%, enterprise <1% monthly. Annual churn equivalents: SMB 30-60%, enterprise 5-10%. Net revenue retention (NRR) >100% means expansion exceeds churn - best-in-class SaaS hits 120%+.
What's the difference between gross and net churn?
Gross churn = lost revenue from cancellations and downgrades. Net churn = gross churn minus expansion revenue (upsells, cross-sells). Negative net churn (NRR >100%) means expansion exceeds losses - a sign of strong product-market fit.
How do I reduce churn?
First measure why: cancellation surveys, exit interviews, usage analytics. Common drivers: poor onboarding (most churn happens in first 90 days), lack of value realization, competitive switching, budget cuts. Top tactics: better onboarding, customer success outreach, in-app engagement, annual contracts.
How is churn rate calculated?
Customer churn = Customers lost / Customers at start of period. Revenue churn = Revenue lost / Revenue at start. Always specify the period (monthly, quarterly, annual). Cohort-based churn is more accurate than aggregate churn for fast-growing companies.
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Business Information Disclaimer: Estimates only. Not professional business advice.
This calculator provides estimates for informational purposes only. Business results vary by industry, market conditions, and execution. Not a substitute for professional business consulting, accounting, or legal advice. Consult qualified professionals before making business decisions.