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.

Worth your time

Unlocking the Path to Negative Churn For Entrepreneurs · guide How expansion revenue can push net retention above 100 percent, the mechanic behind a strong NRR, explained from first principles. Open forentrepreneurs.com →

Related terms

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