Glossary > Total Contract Value (TCV)

Total Contract Value (TCV)

Total Contract Value (TCV) is the total amount of money that a customer has committed to paying you over the length of an entire contract.

In SaaS and subscription businesses, TCV is typically calculated as follows:

TCV = MRR * Contract Term Length + One-time fees

TCV is an important metric in SaaS because it helps you understand how much your business makes on average from each customer you acquire.

MRR = Monthly Recurring Revenue

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