Why is my MRR in ProfitWell different than Paddle?
The MRR you see in ProfitWell won't match the MRR you see in Paddle.
When thinking about the "right way" to calculate MRR, we spend a lot of time agonizing over two things:
1) The accuracy of the data
2) Making the data actionable so you can make better decisions to drive growth.
As ProfitWell and Paddle come together as one, we will transition all Paddle customers onto ProfitWell metrics while going through an evolution of our combined platforms.
We want to be transparent throughout this process and you can expect some changes to the metrics you find in your Paddle dashboard as we make them more accurate.
Some of the differences between the two platforms and their MRR:
- Cancellations vs. Churn - When a user cancels, their MRR is deducted immediately from Paddle MRR, where in ProfitWell's MRR, it's done at the end of the billing cycle. More on why here.
- FX rates - The MRR you see in Paddle is calculated using FX rates from when money is paid out to your customers. The MRR in ProfitWell is using FX rates from the date that the customer purchased the subscription.
- Paddle Invoicing - ProfitWell Metrics doesn't support Paddle Invoicing (yet). Customers who pay via invoice will not be factored into MRR. This is on the roadmap for later this year. In the meantime, these customers can be added manually to ProfitWell through the UI or the google sheets integration.
- Customers - Customers on free trials, paid trials, or free plans do not count towards ProfitWell's customer counts or MRR.
- One time payments - ProfitWell currently ignores any customer who is not on at least one paying subscription. Adding support for one time payments is on the roadmap. Paddle includes customers who purchase one-off transactions in addition to recurring subscriptions.
- Churn - Customers that sign up and churn in the same calendar month do not contribute to ProfitWell's MRR, as to not inflate new + churn.
- Tax- ProfitWell's MRR figures are always exclusive of Tax.
- Historical data - ProfitWell's MRR is calculated from customers who have actually paid through Paddle. Customers that were migrated from a previous platform (i.e. customer halfway on an annual plan who hasn't yet renewed) will not contribute to MRR until they renew. Adding support for migrating and stithing together historical data is on the roadmap.
Needless to say, there are many other complexities and nuances around how MRR is calculated—from how ProfitWell handles refunds, mid-cycle upgrades, credits, coupons, and more. For more detail on how ProfitWell calculates MRR generally and why , check out this doc.
Of course, if you have any questions at all or find discrepancies in the data, we encourage you to share them with our team and we're more than happy to investigate.