How to Use SaaS Quick Ratio Calculator
The SaaS Quick Ratio Calculator sums new MRR and expansion MRR as total gains, sums contraction MRR and churned MRR as total losses, then divides gains by losses. The resulting ratio shows how many dollars of new revenue you generate for every dollar lost. A ratio above 4 is excellent; below 1 means you are shrinking.
What It Does
Use the calculator with intent
The SaaS Quick Ratio Calculator sums new MRR and expansion MRR as total gains, sums contraction MRR and churned MRR as total losses, then divides gains by losses. The resulting ratio shows how many dollars of new revenue you generate for every dollar lost. A ratio above 4 is excellent; below 1 means you are shrinking.
SaaS founders, revenue operations leaders, and investors who need a single metric to gauge whether MRR growth is healthy. It complements NDR by also counting new customer revenue, not just existing customer behavior.
Interpreting Results
The quick ratio is the headline number. Above 4 means you add $4 in revenue for every $1 lost, which indicates strong momentum. If the ratio is low, compare gains and losses to determine whether the problem is weak acquisition, poor expansion, or excessive churn.
Input Steps
Field by field
- 1
New MRR
Enter monthly recurring revenue from brand-new customers acquired this period.
- 2
Expansion MRR
Enter additional MRR from existing customers who upgraded, added seats, or purchased add-ons.
- 3
Contraction and Churned MRR
Enter contraction MRR (downgrades from existing customers) and churned MRR (complete cancellations) separately.
- 4
Results
Review the quick ratio, total gains, and total losses. A ratio above 4 is excellent, 2-4 is healthy, 1-2 needs work, and below 1 means revenue is shrinking.
Common Scenarios
Use realistic starting points
Growing SaaS with moderate churn
New MRR
$20,000
Expansion MRR
$8,000
Contraction MRR
$2,000
Churned MRR
$5,000
Quick ratio of 4.0 is the threshold for excellent. Watch whether churn or contraction is the bigger drag on the ratio.
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FAQ
Questions people ask next
The short answers readers usually want after the first pass.
Sources & References
- The SaaS Quick Ratio — Insight Partners
- SaaS Metrics 2.0 — For Entrepreneurs (David Skok)
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