Formula
New business MRR = Σ MRR at month end of customers
with no MRR at any prior month endWorked example
Illustrative figures. One month for six customers. Customer B had MRR before, so it is reactivation, not new business.
| Customer | History | MRR 31 Aug | MRR 30 Sep | Movement |
|---|---|---|---|---|
| Customer A | First contract | – | 4,000 | New business 4,000 |
| Customer B | Churned in March | – | 2,500 | Reactivation 2,500 |
| Customer C | Since 2024 | 3,000 | 4,200 | Expansion 1,200 |
| Customer D | Since 2025 | 5,000 | 3,500 | Contraction (1,500) |
| Customer E | Since 2023 | 2,000 | – | Churn (2,000) |
| Customer F | Module +1,000, seats −600 | 6,000 | 6,400 | Expansion 400 |
| Total | 16,000 | 20,600 | 4,600 |
New business MRR = 4,000
Go-live date, not signature date
A customer is new in the month its first contract goes live. Signed-not-live value is backlog. Classifying on signature date moves new business ahead of the revenue it describes and breaks the link between the bridge and MRR.
Corporate groups
When a subsidiary of an existing customer signs its own contract, the policy on account hierarchy decides the movement. Treated as part of the group, the contract is expansion; treated as a separate customer, it is new business. State the policy and apply it consistently.
Channels and segments
Where self-serve and sales-led motions coexist, a blended new business figure hides changes in mix. Report it by channel or segment where the data allows.
How Revnewed calculates it
A customer’s first month end with MRR is new business. A customer returning after a month end at zero is reactivation.
Each customer record is classified on its own. A subsidiary entered as a separate customer, with the group as its parent account, is new business when its first contract goes live; a contract added under the existing customer is expansion.
Like every movement, new business is measured at the prior month’s rates, with translation on the FX line.
Common misstatements
- Signature date used
- Signed contracts that have not started are backlog, not new business.
- Win-backs counted as new logos
- This overstates acquisition and conceals the earlier churn.
- New products for existing customers
- A second product sold to an existing customer is expansion.