Net Revenue Retention
Revenue retained from existing customers including upsell and churn. SaaS growth health in one number.
Net Revenue Retention in Practice
Calculation
NRR = (Starting MRR + Expansion - Downgrades - Churn) / Starting MRR × 100%
Why NRR Matters More Than Churn
A company can have high churn and still grow healthily if expansion outpaces it. NRR captures that dynamic in a single figure. Consequently, it is why NRR has replaced logo churn as the headline retention metric for investors.
Track NRR monthly, by segment and by cohort. Typically, enterprise segments have higher NRR than SMB because expansion opportunities are bigger.
NRR vs. GRR, and Why You Need Both
NRR includes expansion; Gross Revenue Retention does not. GRR caps at 100% and shows how much you keep before any upsell, so it is the honest measure of churn and contraction. NRR can exceed 100% and shows the net growth of the existing base. Read together, they separate two questions: are we leaking revenue (GRR), and is the base growing despite the leak (NRR)?
A high NRR carried entirely by a few large expansions can hide a churn problem in the long tail. Track NRR by cohort and by segment so one big upsell does not flatter an otherwise shrinking base. Retention is ultimately driven by experience, so pair the metric with proactive customer service and health-score monitoring.
Frequently Asked Questions
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