Growth Rate Contracted MRR
The month-over-month percentage change in contracted monthly recurring revenue, from the opening balance to the closing balance.
◆ Percentage
Formula
Built from
What it measures
The velocity of your contracted recurring revenue — how fast the committed-contract pool is expanding or shrinking, expressed as a percentage so it compares cleanly across companies of any size. It captures only the contracted segment (formal subscription contracts), not month-to-month or usage revenue, so it isolates the health of your highest-commitment customers.
Why it matters
Absolute CMRR tells you the scale of your committed revenue; the growth rate tells you the health of the machine producing it. A $1M CMRR base growing 3% monthly is a different business from a $500K base growing 10% — the percentage exposes momentum that the dollar figure hides. Finance and the board watch this rate because it leads absolute CMRR: when expansion stalls or a marquee account wobbles, the growth rate bends before the headline number does. Operators read it to judge whether retention and expansion plays are landing in the segment that matters most.
How to read it
Read this as a trend, never a single point. Positive growth means new contracts and expansion are outrunning downgrades and churn in your committed base; flat or negative means the leaks have won. Compare this month to last month, to plan, and to your overall ARR growth rate — if contracted growth lags total growth, your enterprise base is coasting on momentum from smaller cohorts. When the rate falls (say, 8% to 5%), decompose the move into new, upsell, downsell, and churned CMRR before you react: a decline from a single large churn is a different problem from a structural slowdown in new bookings.
What good looks like
Good
CMRR growth running positive and steady month over month, driven by new contracts and expansion in your committed base outpacing downgrades and churn.
Watch
Growth flattening toward zero, or increasingly dependent on a handful of large deals; renewals in key accounts under pressure.
Bad
Zero or negative CMRR growth — contracted customers downgrading or churning faster than new contracts and expansions land.
Watch-outs
- Ignoring the base. A 15% rate on $100K starting CMRR adds less committed revenue than a 3% rate on $2M. Always pair the percentage with the absolute CMRR and the dollar amount of new revenue added.
- Confusing contracted growth with total growth. Your contracted base can crawl at 3% while month-to-month and usage cohorts drive 20% total ARR growth — segment by customer type or you'll misread which engine is working.
- Letting a one-time spike poison the base. If starting CMRR includes a large deal that later churns, the next period's rate looks artificially low. Audit starting CMRR for non-repeating spikes before you trust the rate.
- Letting a positive rate hide contraction. Net growth can stay positive while downgrades and churn quietly accelerate, masked by a few big new bookings. Always read the waterfall components separately.
Worked example
Hypothetical
You close April with $800K in contracted MRR. In May you land two new contracts worth $60K and $40K, upsell existing customers by $30K, downgrade one account by $5K, and lose a $20K customer to churn. Closing CMRR is $800K + $100K + $30K − $5K − $20K = $905K. CMRR growth for May is ($905K − $800K) ÷ $800K = 13.1%.
Variants & windows
The same metric re-expressed by a mechanical transform — a trailing window, a growth rate, a per-unit scaling, or a book/segment cut. Each is computed from Growth Rate Contracted MRR above.
- CMRR Growth Rate Growth rate