Question 1

What is good MRR growth for a B2B SaaS startup?

Accepted Answer

Early-stage B2B SaaS should target 10–15% MoM growth. At $1M ARR, 10% MoM is exceptional. Investors look for T2D3 growth (triple, triple, double, double, double) from $1M to $10M ARR. At $10M ARR, 5–8% MoM growth is strong.

Question 2

What is a good average contract value (ACV) for B2B SaaS?

Accepted Answer

B2B SaaS ACV benchmarks: SMB-focused = $1,200–$5,000/year, mid-market = $10,000–$50,000/year, enterprise = $50,000–$500,000+/year. Higher ACV means longer sales cycles but better unit economics, lower churn, and stronger net revenue retention.

Question 3

What is a good MRR growth rate?

Accepted Answer

Early-stage SaaS should target 10-20% month-over-month growth. Growth-stage ($1M+ ARR) aims for 5-10% monthly. At scale, 3-5% monthly (36-60% annually) is considered strong. The 'triple triple double double double' framework targets 3x in years 1-2, 2x in years 3-5.

Question 4

What's the difference between MRR and ARR?

Accepted Answer

MRR (Monthly Recurring Revenue) is your normalized monthly revenue from subscriptions. ARR (Annual Recurring Revenue) = MRR × 12. ARR is used for valuation conversations; MRR for day-to-day growth tracking.

Question 5

What churn rate is acceptable for SaaS?

Accepted Answer

Best-in-class SaaS: < 0.5% monthly (6% annually). Good: 1-2% monthly. Problematic: > 3% monthly (30%+ annual). High-velocity self-serve products can tolerate slightly higher churn than enterprise-focused products.

Question 6

What does net new MRR include?

Accepted Answer

Net new MRR = New MRR (new customers) + Expansion MRR (upgrades) - Churned MRR (cancellations) - Contraction MRR (downgrades). Negative net new MRR means churn is outpacing growth.

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