Gross Revenue Retention (GRR)
Gross Revenue Retention (GRR) measures the percentage of starting customer revenue retained after one year — excluding expansion — capturing pure customer retention without offsetting growth signal.
Why This Matters
GRR calculation: (starting ARR - contraction - churn) / starting ARR, measured at customer cohort level. GRR ranges 0-100% (cannot exceed 100% — excludes expansion). Healthy B2B SaaS GRR: 90%+. Below 85% indicates significant churn problems. Top performers achieve 95%+ GRR. GRR pairs with NRR for complete retention picture: NRR 130% / GRR 90% = healthy expansion masking 10% gross churn; NRR 130% / GRR 95% = exceptional retention plus expansion.
Frequently Asked Questions
Frequently Asked Questions
Why measure both GRR and NRR?
GRR isolates retention performance; NRR combines retention with expansion. Both needed because high NRR can mask poor GRR. Healthy SaaS achieves both — NRR over 110% AND GRR over 90% indicates strong overall economics.
What's the relationship between GRR and customer success investment?
Strong GRR requires customer success investment. Customer success teams reduce churn through value demonstration, problem resolution, and relationship management. CS investment ROI measured partly through GRR improvement.