Mathematical Formula

NRR = ((Starting MRR + Expansion MRR - Churned MRR - Downgraded MRR) / Starting MRR) * 100

What is NRR?

Net Revenue Retention measures your ability to grow revenue from your existing customer base through cross-sells, upsells, and price increases, even after accounting for cancellations and downgrades.

Where is NRR Used?

SaaS financials, investment decks, public company reports, and board updates.

What Does It Mean & Strategic Value

An NRR of 115% means your existing customer base spent 15% more with you this year than last year, showing excellent product stickiness.

Down-Funnel Impact

SaaS businesses with an NRR over 120% grow incredibly fast because their existing customer base expands organically, without needing heavy ad spend.

Real-World Usage & Auditing

Analyzed by CFOs to evaluate SaaS pricing strategies and guide customer success team goals.

Why NRR Matters for Growth

The ultimate health metric for subscription businesses, showing true product value and customer satisfaction.

Operational Example Scenario

If you start the year with $100,000 in monthly recurring revenue (MRR), generate $20,000 in expansion upsells, and lose $5,000 to cancellations, your NRR is 115%.