Product-Led Growth (PLG) MRR Velocity Calculator
Simulate self-serve subscriber acquisition, product-qualified lead (PQL) conversions, and low-friction expansion.
Parameters & Config
Active MRR at the start of the billing month
Monthly revenue from newly acquired signups
Additional revenue from existing customer tier upgrades and add-ons
Lost revenue from cancellations and downgrades during the month
Total MRR achieved at period end after additions and churn
Ending MRR projected over 12 months
Key Metrics & Sub-Totals
3 itemsCalculation Summary & Unit Breakdown
| Metric | Calculated Value | Notes / Logic |
|---|---|---|
| Beginning Monthly Recurring Revenue | $40000.00 | - |
| New Sign-up MRR Added | $7500.00 | New customer bookings |
| Expansion & Upsell MRR | $3500.00 | Tier upgrades |
| Churned & Lost MRR | $1800.00 | Cancellations + contractions |
| Net New Added MRR | $9200.00 | Net expansion |
| Ending Monthly Recurring Revenue | $49200.00 | Current month close |
| Annualized Run Rate (ARR) | $590400.00 | Ending MRR × 12 |
| Net Monthly Growth Rate | 23% | Month-over-month |
| SaaS Quick Ratio | 6.11x | Growth vs Churn efficiency |
Overview & Methodology
Product-Led Growth (PLG) centers the software itself as the primary driver of acquisition, retention, and expansion (e.g. Slack, Figma, Notion). Self-serve signups paired with high product engagement yield low CAC and strong compounding revenue.
Mathematical Formulation
Net New PLG MRR = Self-Serve New MRR + Usage Expansion - Churn. Growth Rate = (Net New / Starting MRR) × 100.Optimization Best Practices
Track Product-Qualified Leads (PQLs)—users who have experienced your product’s "Aha!" moment and have a 5x higher propensity to convert.
Implement viral collaboration features (e.g. sharing invite links, shared team workspaces) to generate free viral coefficients.
Use interactive in-app tooltips rather than lengthy email drip sequences to guide users to core value.
Frequently Asked Questions
Q.What is a Product-Qualified Lead (PQL)?
A PQL is a free user who has reached a defined usage threshold (e.g. invited 3 teammates or exported 5 files) indicating high purchase intent.
Q.How does PLG lower CAC compared to sales-led growth?
Users onboard themselves through intuitive UI without requiring human demo calls or sales commissions.
Q.What is the Quick Ratio on $11k added vs $1.8k churn in PLG?
The Quick Ratio is 6.11x ($11,000 / $1,800), reflecting world-class product-led growth efficiency.