What is net revenue retention (NRR)?

Written by Madalena Rugeroni, founder of Mazo · Updated 15 September 2026

Net revenue retention (NRR) is the percentage of recurring revenue a SaaS company keeps from an existing group of customers over a period, usually 12 months, after adding expansion and subtracting downgrades and churn. Revenue from new customers is excluded. NRR above 100% means existing customers grow revenue even with no new sales.

NRR formula

NRR = (starting MRR + expansion − contraction − churned MRR) ÷ starting MRR × 100

"Starting MRR" is the recurring revenue from customers you had at the beginning of the period. Everything in the formula is about those customers only: new customers acquired during the period are excluded.

Worked example

A fictional SaaS had €50,000 MRR from its existing customers twelve months ago. Over the year, those customers:

expanded by €8,000 (upgrades and more usage),
downgraded by €2,000,
churned €4,000.

NRR = (€50,000 + €8,000 − €2,000 − €4,000) ÷ €50,000 = 104%. Its gross revenue retention, which ignores expansion, is (€50,000 − €2,000 − €4,000) ÷ €50,000 = 88%.

NRR benchmarks

SaaS Capital, 2026: bootstrapped B2B SaaS companies with $3M–$20M ARR report a median NRR of 103%, with the top 10% at about 118%.¹
SaaS Capital, 2023: companies on month-to-month or annual contracts show a median NRR of about 100%, and equity-backed companies report slightly higher NRR than bootstrapped ones.²

These datasets are of companies above €1M ARR. Below that, a single customer expanding or leaving can move NRR by several points, so read it as a trend.

Why NRR matters from €0 to €1M ARR

Pre-revenue to €10k MRR: too few customers for a meaningful percentage. Watch whether each customer is still using the product.
Around €30k–€50k MRR: calculate it quarterly on a trailing twelve months. Expansion only comes if your value metric grows with the customer.
Approaching €1M ARR: NRR becomes the most important metric. David Skok calls negative churn — expansion covering what's lost — the most powerful compounding force in SaaS, and Jason Lemkin's view is that if NRR is above about 100%, almost everything else is fixable.

Mazo's rule of thumb: under 10 customers, track interviews and willingness-to-pay signals, not NRR. Near €1M ARR, watch CAC payback and net revenue retention — aim for NRR above 100%, where expansion covers churn.

Common NRR mistakes

Including new customers. It turns NRR into a growth rate.
Annualising one month. A single upgrade month isn't a year.
Reporting NRR without GRR. A strong NRR can hide heavy churn covered by a few large expansions.

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FAQ

What is a good net revenue retention rate?

Above 100% means existing customers grow revenue on their own. SaaS Capital's 2026 data puts the median at 103% for bootstrapped B2B SaaS companies with $3M–$20M ARR, with the top 10% around 118%.

What is the difference between NRR and GRR?

Net revenue retention includes expansion revenue from existing customers, so it can exceed 100%. Gross revenue retention excludes expansion and only subtracts churn and downgrades, so it can never exceed 100%.

Is NRR the same as net dollar retention?

Yes. Net dollar retention (NDR) and net revenue retention (NRR) describe the same metric; the name varies by company and currency.

Who wrote this

Madalena Rugeroni built Mazo. She's an ex-Googler, a startup advisor and investor, and runs a portfolio of internet companies. Before that, as Head of Growth at Amplemarket, she scaled a B2B SaaS to $10M ARR. LinkedIn

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Sources.

Median NRR 103% and 90th percentile ~118% for bootstrapped $3M–$20M ARR companies: SaaS Capital, "2026 Benchmarking Metrics for Bootstrapped SaaS Companies"
Median NRR ~100% on month-to-month or annual contracts; equity-backed slightly higher: SaaS Capital, "2023 B2B SaaS Retention Benchmarks" (PDF)

Operators and books referenced: David Skok (forEntrepreneurs), Jason Lemkin (SaaStr). These are published methodologies credited to their authors; Mazo is not affiliated with or endorsed by them.