NRR (Net Revenue Retention)

The percentage of revenue retained from existing customers over a year, including expansion.

Customer Success

Ufafanuzi wa

Net Revenue Retention measures how much revenue from an existing cohort of customers grew or shrank over 12 months, including expansion, contraction, and churn. NRR above 100% means expansion exceeded losses — the holy grail of SaaS.

Pointi muhimu

  • Formula: (Starting ARR + Expansion − Contraction − Churn) / Starting ARR × 100
  • >100% NRR = net negative churn; customers grow faster than they shrink
  • Best-in-class: 120%+ NRR
  • NRR below 90% is typically a structural business model problem
Mfano wa Mfano

Start Jan 2025 with $1M ARR from 100 customers. 12 months later: same cohort now worth $1.2M (expansion $300k, contraction $50k, churn $50k). NRR = 1.2 / 1.0 = 120%.

Maneno yanayohusiana

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