Metric
SaaS quick ratio
New plus expansion recurring revenue divided by churned plus contracted revenue in the same period. A target of 4 is widely repeated but weakly sourced; under 1 means recurring revenue is shrinking.
Plain label: revenue added per revenue lostAlso known as: MRR quick ratio, revenue quick ratio
No dated benchmark. The target of about 4 is a widely repeated rule of thumb with weak, undated attribution and no dataset behind it (benchmark confidence C); under 1 is a warning. Compare the product with its own trend instead.
Very fast acquisition can hide heavy churn behind a healthy-looking ratio, so always read the components and net revenue retention next to it. It is the revenue twin of the user quick ratio.
Sources
What is the quick ratio hiding? · Tom Tunguz
Benchmark confidence C. A secondary source.
Book content is paraphrased, never quoted at length. Last verified October 24, 2026.
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