I built a free churn rate calculator for SaaS founders - here's what I learned about churn benchmarks
I've been building free tools for SaaS founders and just shipped the first one: a churn rate calculator.
It calculates your churn rate, shows a 12-month customer projection, revenue impact, and benchmarks you against industry averages (enterprise, mid-market, SMB, consumer).
What surprised me during research:
At 5% monthly churn, which sounds small, you're losing 46% of your customers annually. You'd need to replace nearly half your customer base every year just to stay flat.
And most founders I've talked to track customer churn but not revenue churn, which is often the more important number. Losing your highest-paying customers is way worse than losing a bunch of free-tier users, but the customer churn number doesn't tell you that.
The benchmarks that matter:
- Enterprise: 0.5-1% monthly (long contracts help)
- Mid-market: 1-2% monthly
- SMB: 3-5% monthly (this is where most indie hackers sit)
- Consumer: 5-7%+ monthly
If you're in SMB and above 5% monthly, it's worth digging into why before spending more on acquisition.
Here's the tool if useful: beyondfolder.com/tools/churn-rate-calculator
Free, no signup, runs in the browser. Would love feedback on what other calculators would be helpful for you.
Great tool - the revenue churn vs customer churn distinction is key.
One thing I'd add to the benchmarks: a chunk of what looks like "churn" is actually involuntary - soft declines, etc. Not customers choosing to leave, just billing mechanics.
For SMB SaaS, that's often 3-9% of MRR silently leaking. Worth splitting out before assuming it's a product problem.
This is solid especially the emphasis on revenue churn vs customer churn.
One thing that stood out: most churn tools stop at “your number vs benchmark,” but the real moment of insight is why the churn is happening.
Have you considered pairing the output with a lightweight diagnostic like:
“If revenue churn > customer churn --> you’re breaking promises for power users.”
“If customer churn is high but revenue churn is low --> onboarding / expectation mismatch.”
That kind of framing could turn this from a calculator into a decision tool.
No but that is a good idea to expand this
This is super useful (and +1 on highlighting revenue churn vs logo churn).
One thing that trips founders up is mixing definitions:
If you’re iterating on the calculator, a couple additions that could make it even more actionable:
Curious: are you planning to benchmark by price point / contract length too? That seems to be the other huge driver.
Indeed considering price point would be a logical first step