Definition
The percentage of churned revenue caused by failed payments rather than an active decision to cancel.
Formula
MRR lost to failed payments / Total churned MRR x 100
How to measure
Tag every churn event by cause, distinguishing failed-payment cancellations from active cancellations, then calculate the failed-payment share.
Why track it
Involuntary churn is usually the cheapest churn to recover through better dunning and card-update flows, since it requires no product changes.
Example
A company finds 35% of its total churned MRR came from failed payments rather than active cancellations.
FAQ
- What is Involuntary Churn Rate?
- The percentage of churned revenue caused by failed payments rather than an active decision to cancel.
- How do you calculate Involuntary Churn Rate?
- MRR lost to failed payments / Total churned MRR x 100
- Why track Involuntary Churn Rate?
- Involuntary churn is usually the cheapest churn to recover through better dunning and card-update flows, since it requires no product changes.