SaaS Quick Ratio Calculator

What Is the SaaS Quick Ratio?

The SaaS quick ratio measures growth efficiency: how many dollars of MRR you gain for every dollar you lose. You take gross MRR gained (new business plus expansion) and divide it by gross MRR lost (churn plus contraction) over the same period. Popularized by Mamoon Hamid at Social Capital, it exposes what a headline growth rate hides — whether you're growing because the engine is efficient, or because you keep refilling a leaky bucket.

Two companies can both add $50,000 in net-new MRR this month. One gained $60,000 and lost $10,000 (quick ratio 6.0). The other gained $200,000 and lost $150,000 (quick ratio 1.3). Same net growth, very different businesses — the second gets more expensive to grow every single month.

The Formula, With a Worked Example

Quick Ratio = (New MRR + Expansion MRR) ÷ (Churned MRR + Contraction MRR)

Say in March you closed $30,000 of new MRR and existing customers upgraded by another $10,000. Over the same month you lost $8,000 to cancellations and $2,000 to downgrades:

• MRR gained: $30,000 + $10,000 = $40,000
• MRR lost: $8,000 + $2,000 = $10,000
• Quick ratio: $40,000 ÷ $10,000 = 4.0

You added $4 of recurring revenue for every $1 that walked out the door. All four inputs come straight from your MRR movement report, so the calculation takes seconds.

What's a Good SaaS Quick Ratio?

The classic thresholds come from Social Capital's framework. Treat the stage numbers below as directional 2026 medians, synthesized from public SaaS benchmark reports — see the full benchmark library for sources and caveats.

By stage, directional medians run around 4 at seed, 3 for bootstrapped and Series A companies, and 2 at Series B and beyond. That compression is normal: a bigger MRR base throws off more absolute churn dollars while new-logo MRR can't scale as fast. A seed-stage company at 2.0 likely has a retention problem; a $50M ARR company at 2.0 is on track.

Common Mistakes

First, this is not the accounting quick ratio — the acid-test liquidity metric comparing current assets to current liabilities. Same name, unrelated metric. Second, use MRR dollars, not logo counts: losing ten $50/month customers while landing one $5,000/month account is a win, and customer counts would tell you the opposite. Third, don't drop expansion and contraction from the formula — they routinely swing the result by a full point. Finally, beware small denominators: one lucky low-churn month produces a flattering spike, so trailing three-month sums give a truer read. The quick ratio also says nothing about what your growth costs — pair it with the SaaS magic number for sales efficiency, NRR for the health of your existing base, and the Rule of 40 for the growth-versus-profitability tradeoff.