SaaS & Business
Churn Rate
The percentage of customers (or revenue) a SaaS business loses to cancellations in a given period.
Reviewed by the RadarTrek editorial team · June 2026
Churn rate measures loss — either logo churn (percentage of customers who cancelled) or revenue churn (percentage of MRR lost to cancellations). The two can tell very different stories: losing 10 small customers might be fine, losing 1 large one might not be. The compounding effect is brutal — at 5% monthly churn you lose half your customer base in a year; at 2% you lose about a fifth.
Why it matters
- —Revenue churn matters more than logo churn when customers vary significantly in size.
- —Small differences in monthly churn compound dramatically over a year — 2% vs 5% is the gap between sustainable and unsustainable.
- —Churn is the input every other growth metric depends on — it sets the ceiling on how fast a leaking business can actually grow.
Where to learn this
🎓
Churn — Measuring, Understanding, and Reducing It
SaaS Metrics and Finance course
This is the exact lesson that covers this term in depth — with examples, diagrams, and a hands-on exercise.