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Net Revenue Retention

Also called NRR, Net Dollar Retention, and NDR

Net revenue retention measures how much recurring revenue you keep from existing customers over a year, including upgrades and expansion but after downgrades and churn. Above 100 percent means the base grows even with no new customers.

NRR = (starting revenue + expansion - contraction - churn) / starting revenue

Why it matters

NRR is one of the most watched SaaS metrics because it shows whether your product gets more valuable to customers over time. Best-in-class NRR above 120 percent is a growth engine on its own.

For example

A SaaS company grows revenue from its existing base by 18 percent through upsells even after churn, a net revenue retention of 118 percent.

Go deeper

Related terms

Gross Revenue Retention Expansion Revenue Churn

Also in Starting Up

See how founders actually handle this on Money, pricing and metrics, part of the Starting Up hub.

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