How to Calculate Exactly How Much Revenue You're Losing to Failed Payments
The 3-step formula SaaS founders use to size the problem. Plus a free interactive calculator you can use right now.
Before you can decide whether paid payment recovery is worth your time (or money), you need to know what you're losing. Here's the simplest formula we know.
The 3-step formula
Step 1: Find your MRR (monthly recurring revenue)
Step 2: Multiply by 9% (industry average involuntary churn)
Step 3: That's your monthly loss. Multiply by 12 for annual.
That's it. Three steps. The whole thing takes 30 seconds.
Worked example
Let's say your MRR is $30,000:
- $30,000 × 9% = $2,700/month lost
- $2,700 × 12 = $32,400/year lost
- Top-quartile recovery = 65% × $32,400 = $21,060 back in your pocket
At PaidGuard's Growth tier ($99/month), that's a 213x ROI. Most founders don't believe it until they see the number for their own business.
Where to find your actual MRR in Stripe
Don't guess. Pull it from your Stripe dashboard:
- Open Stripe Dashboard → Home
- Look for "MRR" in the top stat row
- That's your number
Stripe also gives you your actual failed-payment rate. It's in Reports → Subscriptions → Failed payments. That's a more accurate number than the industry 9%—use it if you can.
Caveats and adjustments
Annual vs monthly subscriptions
Annual subscribers fail less often (lower volume), but when they fail, the dollar amount is higher. The 9% average holds across both. If you only have annual plans, your per-failure dollar value is 12x higher but count is much lower.
B2B vs B2C
B2B SaaS sees slightly lower failure rates than B2C (corporate cards fail less), but recovery rates are higher because there's usually a finance team involved. Net result: roughly the same loss percentage.
High-churn vs low-churn
If your voluntary churn is already high, the 9% involuntary rate still applies—on top of your existing churn. The total addressable recovery shrinks proportionally, but the percentage remains.
Use the calculator
We've built the calculator into our homepage. Just enter your MRR and instantly see:
- Annual revenue lost without intervention
- Annual revenue recovered with PaidGuard
- ROI vs our different pricing tiers
Three numbers. Thirty seconds. That's all it takes.
Calculate your loss →When the number is small, it's still worth it
If your MRR is $5,000 and you calculate $4,500/year lost, that's still meaningful. $4,500 is a Stripe Atlas LLC formation plus a new laptop. It's a small reinvestment that compounds.
More importantly, recovered revenue doesn't churn later. A customer who updates their card stays 8-12 months longer on average. That's where the long-term compounding lives.