SaaS Metric
SaaS Quick Ratio
Definition
The SaaS quick ratio measures growth efficiency: how much MRR you add for every dollar you lose. Quick ratio = (new MRR + expansion MRR) ÷ (churned MRR + contraction MRR). Popularised by Social Capital, a ratio of 4 or higher is excellent; below 1 means losses outweigh gains and the business is shrinking.
Formula
SaaS quick ratio = (new MRR + expansion MRR) ÷ (churned MRR + contraction MRR)
Benchmark
A quick ratio of 4+ is excellent. Between 1 and 4 you are growing but losing efficiency to churn. Below 1, losses exceed gains.
What the quick ratio captures
Unlike NRR, the quick ratio includes brand-new MRR, so it measures total growth efficiency from all sources against all losses. It answers: for every dollar of recurring revenue leaving, how many dollars are coming in?
It exposes the leaky-bucket problem. Two companies can add identical new MRR, but the one losing less to churn grows far more efficiently. A high quick ratio means growth is durable rather than a treadmill where new sales merely replace churned revenue.
Frequently asked questions
What is a good SaaS quick ratio?
A quick ratio of 4 or higher is considered excellent — you add at least $4 of MRR for every $1 lost. Between 1 and 4 you are still growing but losing efficiency to churn; below 1 the business is contracting.
How is the SaaS quick ratio different from NRR?
NRR measures retention of an existing cohort and excludes new customers. The quick ratio includes new MRR, so it captures total growth efficiency — how well gains from all sources outpace all losses.
Related metrics
Net Revenue Retention (NRR)
Net revenue retention (NRR) measures recurring revenue kept from existing customers including expansion. Learn the NRR formula, what 100%+ means, and SaaS benchmarks.
Expansion Revenue
Expansion revenue is additional recurring revenue from existing customers via upgrades, seats and cross-sells. Learn how it drives net negative churn and NRR above 100%.
Monthly Recurring Revenue (MRR)
Monthly recurring revenue (MRR) is the normalised, predictable subscription revenue earned each month. Learn the MRR formula, its movement components, and how it relates to ARR.
Churn Rate
Churn rate is the percentage of customers or revenue lost in a period. Learn the customer churn and revenue churn formulas, healthy SaaS benchmarks, and how to reduce it.
Track this automatically
Connect Stripe and RetentionLens computes SaaS Quick Ratio for you — with cohorts, trends and churn-risk scoring. Start on the free tier.
Benchmarks are general SaaS ranges and vary by segment, stage and business model. Last reviewed 2026-05-30.