New Monthly Recurring Revenue
Recurring monthly revenue added by customers landing their first paid contract in the period — brand-new logos only.
◆ Currency
Formula
Built from
What it measures
New MRR measures the normalized monthly value of contracts from customers who had $0 MRR in the prior period and went live this period. It isolates revenue from brand-new relationships — expansion in your existing base is Upsell MRR, not New MRR. Reactivations of fully-churned logos and one-time setup fees are excluded.
Why it matters
You watch New MRR to see whether your acquisition engine is working, before churn, upsell, and downsell noise cloud the picture. It is the cleanest read on sales productivity and market demand: finance uses it to forecast forward growth, and sales and product leadership use it to validate product-market fit and go-to-market efficiency. When New MRR moves, your top of funnel is moving — and it moves before everything downstream.
How to read it
Read New MRR as a trend, not a single number. Rising New MRR means acquisition is accelerating; flat or falling means sales friction, market saturation, or campaign fatigue. Compare month-over-month for momentum and year-over-year to strip out seasonality. Then read it against two things: your blended CAC and the average ACV of new logos. If New MRR is shrinking while CAC climbs, your unit economics are deteriorating. If New MRR holds but new-logo ACV is dropping, you are winning smaller deals — a mix shift the headline number hides.
What good looks like
Good
New MRR growing month-over-month and outpacing your blended CAC trend, with new-logo ACV holding or rising — acquisition is compounding.
Watch
New MRR flat or growing below your established rate; new-logo ACV slipping or CAC creeping up — investigate pipeline coverage and sales-cycle length.
Bad
New MRR declining month-over-month while CAC rises — the acquisition engine is breaking and unit economics are deteriorating.
Watch-outs
- Conflating New MRR with expansion. New MRR captures only net-new logos (prior MRR = $0), never growth inside existing accounts — flat New MRR is not stagnation if Upsell MRR is climbing.
- Counting reactivations wrong. A returning logo is New MRR only if its prior MRR was truly $0; a customer who merely downgraded and came back is Upsell MRR, not New.
- Booking annual contracts as lump sums. A $120K annual deal is $10K of New MRR in the go-live month, not $120K — always normalize TCV to the monthly equivalent.
- Using signature date instead of go-live. New MRR lands the month a logo starts paying, not the day the contract was signed — get this wrong and your monthly numbers shift a period.
Worked example
Hypothetical
In June you sign three new logos: Customer A ($120K TCV, 12-month term = $10K MRR), Customer B ($60K, 12-month = $5K), and Customer C ($36K, 12-month = $3K), all live June 15. New MRR for June is $18K. In July only Customer D ($24K, 12-month = $2K) goes live, so July New MRR is $2K. That June-to-July drop is slower deal flow in the pipeline — not churn of existing customers, which would never touch New MRR.