Net New MRR Bridge
Bridge beginning MRR to ending MRR by isolating churn, downgrades, and expansion.
Quick checklist
- Start from a clean opening MRR baseline.
- Track expansion, contraction, and churn separately.
- Reconcile changes with billing systems.
- Review monthly to avoid stale assumptions.
- Use the bridge to explain MRR movement to leadership.
Step-by-step
- Export opening MRR for the month.
- Subtract churned revenue and downgrades.
- Add expansion revenue from upgrades and add-ons.
- Add new MRR from new customers if needed.
- Validate the bridge against ending MRR.
Why the bridge matters
- It highlights whether growth is coming from new logos or expansion.
- It shows when downgrades are offsetting price increases.
- It keeps retention metrics consistent across teams.
Common mistakes
- Double counting expansion and price increase impact.
- Ignoring mid-cycle downgrades.
- Mixing billing and usage periods.
