Metrics
Net Revenue Retention (NRR)
Quick definition
Revenue from your existing customer base 12 months later, including expansion and churn.
NRR = (Starting ARR + Expansion − Contraction − Churn) / Starting ARR, measured on a fixed cohort over 12 months. Best-in-class SaaS companies see NRR above 120%. Below 100% means the base is shrinking.
Related metrics terms
ARR (Annual Recurring Revenue)
Annualized value of your subscription revenue at a point in time.
MRR (Monthly Recurring Revenue)
Monthly equivalent of ARR, useful for month-over-month tracking.
Gross Revenue Retention (GRR)
NRR without upsell — what you keep before expansion.
CAC (Customer Acquisition Cost)
Fully-loaded cost to acquire one new customer.
See this in action
Insights and tools where Net Revenue Retention (NRR) shows up.
Frequently asked questions
- What is Net Revenue Retention (NRR)?
- NRR = (Starting ARR + Expansion − Contraction − Churn) / Starting ARR, measured on a fixed cohort over 12 months. Best-in-class SaaS companies see NRR above 120%. Below 100% means the base is shrinking.
- Why is Net Revenue Retention (NRR) important for startups?
- Net Revenue Retention (NRR) is a metrics concept that matters for startup founders because it directly affects fundraising readiness, financial decision-making, or operational discipline at the stage where mistakes are expensive to undo. Founders who understand it have a meaningfully easier time in diligence, board meetings, and investor conversations.
- What category does Net Revenue Retention (NRR) belong to?
- Net Revenue Retention (NRR) is a Metrics term in the StartupCFO finance glossary — alongside other metrics concepts that founders, CFOs, and accountants use in daily startup operations and reporting.
- Where can I learn more about Net Revenue Retention (NRR)?
- Beyond this definition, see the related metrics terms below, or explore StartupCFO's insights and tools that put Net Revenue Retention (NRR) in context. For specific situations, talk to a fractional CFO who can walk through your numbers.
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