The percentage of revenue retained from existing customers over a period, including expansions and minus contractions and churn. NRR > 100% means existing customers grow faster than they leave.
NRR is the single best indicator of product stickiness. NRR >120% is elite. NRR >130% is best-in-class. Public SaaS like Snowflake (160%+) and Datadog (130%+) command premium multiples primarily because of NRR.
NRR = (Starting MRR + Expansion - Churned - Contraction) / Starting MRRNRR >160% — usage-based pricing compounds with customer growth
NRR ~130% — usage expansion as customers scale
NRR > 100% means you can grow without acquiring new customers. The most efficient form of growth.
100% = stable. 110% = healthy. 120%+ = strong. 130%+ = elite.
Add usage-based pricing, build features that grow with the customer, target larger ICPs, and reduce churn.
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