Answers

What churn rate is acceptable when buying a micro-SaaS?

Short answer: For a small SaaS you plan to buy, monthly revenue churn under about 3% is comfortable and above 5% is a warning: at 5% you lose almost half your revenue in a year without new sales. Ask for 12 months of churn computed from Stripe, not a single quoted figure, and stress-test the price.

Updated 7 October 2026 · Figures checked against their sources on 7 October 2026

What is the difference between logo churn and revenue churn?

Logo churn counts the share of customers who cancel each month; revenue churn counts the share of monthly recurring revenue lost to cancellations and downgrades. For a buyer, revenue churn matters more, because losing one large customer can cut revenue more than losing ten small ones. Ask for both, and for net revenue churn after upgrades.

How much revenue does a SaaS keep after 12 months at each churn rate?

A SaaS with 5% monthly revenue churn and no new sales keeps about 54% of its revenue after 12 months, because 0.95 multiplied by itself 12 times is 0.54. At 3% it keeps about 69%, and at 2% about 78%. This is arithmetic, not an industry survey.

Arithmetic: (1 − churn)¹².

That is why we treat about 3% a month as comfortable and above 5% as a warning. These are our checker thresholds for a small SaaS you plan to buy, not an industry statistic; our checker flags churn above 5% a month.

What does churn do to payback if new sales stop?

With high churn and no new sales, a SaaS may never pay back its price: in the composite below, a $70,000 business with $3,000 MRR and 5% monthly churn would earn only about $45,000 of profit in total if sales stopped, less than the price. Even with $120 of new MRR a month, payback stretches from 31 to 35 months.

Try your own figures in the SaaS churn stress test. A new owner often sells less than the founder did in the first months, so the no-new-sales case is worth taking seriously.

How do I compute churn from a Stripe export?

To compute monthly revenue churn from Stripe, export 12 months of subscriptions, then for each month divide the MRR lost to cancellations and downgrades by the MRR at the start of that month. Use the seller's View Only Stripe access so the data comes from the source, and compare your figure with the one in the listing.

1. Export subscriptions with start, cancellation and amount changes.
2. For each month, list MRR at the start of the month.
3. Add up MRR lost from cancellations and downgrades in that month.
4. Divide lost MRR by starting MRR. Look at all 12 months, not the best one.

What if the listing gives no churn figure?

A recurring-revenue listing with no churn figure leaves the most important number for the buyer unknown, so ask for 12 months of churn computed from Stripe before you value it. Our checker raises no churn figure for subscription businesses that leave it out. See how to verify Stripe revenue for the access to request.

Sources

1. FirstPass Memo, red-flag checker rules, our own rules, published as /rules.json
2. Stripe Docs, User roles, read 7 October 2026

Related

• SaaS churn stress test
• Red flag: monthly churn above 5%
• Red flag: no churn figure
• How to verify Stripe revenue
• How to value a small SaaS
• Due diligence for a small SaaS
• Glossary of listing terms
• More questions buyers ask

Composite examples are invented and labelled. Figures from other sites are quoted with a link and the date we read them; FirstPass figures are asking prices and seller-stated profit, not sale prices. Informational screening only, not investment, legal or tax advice.