Pocketsflow

// subscription calculator

MRR, churn and lifetime value, worked out.

MRR is subscribers times the monthly price. A subscriber stays 1 / churn months, and that times the price is their lifetime value. Enter your numbers to see all of it, after fees, and the next 12 months.

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Subscription calculator

Billed

The share of subscribers who cancel each month.

At these numbers

$2,000.00 MRR today, about $4,760.00 in 12 months.

MRR$2,000.00
ARR$24,000.00
MRR after fees (4.7% + $0.30)$1,876.00
Average customer lifetime20 mo
Lifetime value (LTV)$400.00
LTV after fees$375.20
Steady state (new / churn)400 subs

Lifetime is 1 / churn. LTV is monthly revenue per subscriber times lifetime; after fees takes 4.7% + $0.30 off each payment. Subscribers are rounded to whole people each month.

Subscribers and MRR at the end of each of the next 12 months
MonthSubscribersMRR
Today100$2,000.00
Month 1115$2,300.00
Month 2129$2,580.00
Month 3143$2,860.00
Month 4156$3,120.00
Month 5168$3,360.00
Month 6180$3,600.00
Month 7191$3,820.00
Month 8201$4,020.00
Month 9211$4,220.00
Month 10220$4,400.00
Month 11229$4,580.00
Month 12238$4,760.00

A model, not a forecast: one plan, steady growth and steady churn. Trials, upgrades, failed payments and refunds are left out.

// the formulas

Four numbers, one line each.

Every result above comes from these formulas. The worked examples use the calculator's defaults: $20 a month, 100 subscribers, 20 new a month, 5% churn.

  • MRR

    subscribers × monthly price

    Monthly recurring revenue. A yearly plan counts as price / 12. 100 subscribers at $20 a month is $2,000.00.

  • ARR

    MRR × 12

    Annual recurring revenue: what a year looks like if nothing changes. $2,000.00 of MRR is $24,000.00 of ARR.

  • Lifetime and LTV

    lifetime = 1 / churn · LTV = monthly price × lifetime

    At 5% churn a subscriber stays 20 months on average, so $20 a month is worth $400.00, or $375.20 after 4.7% + $0.30 per payment.

  • Steady state

    new per month / churn

    The size where new subscribers equal those who leave. 20 new a month at 5% churn levels off at 400 subscribers.

On Pocketsflow, subscriptions and memberships are on every plan, including Free, at 4.7% + $0.30 per payment with no monthly fee. From the Pro plan, failed payment recovery and cancellation save offers help lower churn. See subscriptions or compare plans.

// faq

Common questions.

How do I calculate MRR?

Multiply your paying subscribers by what each pays a month. Yearly plans count as the yearly price divided by 12. 100 subscribers at $20 a month is $2,000.00 of MRR, and $24,000.00 of ARR.

How do I calculate churn?

Divide the subscribers who cancelled during a month by the subscribers you had at the start of it. 5 cancellations out of 100 is 5% monthly churn.

How do I calculate customer lifetime value (LTV)?

Divide what a subscriber pays a month by your monthly churn. $20 at 5% churn is $20 / 0.05 = $400.00. On Pocketsflow each $20 payment leaves $18.76 after 4.7% + $0.30, so the LTV after fees is $375.20.

How much does lower churn help?

A lot, because lifetime is 1 / churn. Halving churn doubles lifetime, LTV and the size your list levels off at: at 2.5% instead of 5%, the $20 example is worth $800.00 a subscriber instead of $400.00.

Why does my subscriber count stop growing?

Because the subscribers you lose each month grow with your list, while new ones stay about the same. Growth stops at new per month / churn: 20 new a month at 5% churn levels off at 400, whatever you start from. To grow past it, bring in more subscribers or lose fewer.

What does Pocketsflow charge on subscriptions?

4.7% + $0.30 per payment, card processing and tax handling included, and no monthly fee. Subscriptions and memberships are on every plan, including Free.

// more free tools

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