Blog · Wallet share and penetration · SaaS
The honest answer to what net revenue retention a company should have: the widely quoted 100 percent floor and 120 percent aspiration are SaaS investor figures that depend on segment, contract structure and what is counted as expansion. This page gives the ranges by segment, the three measurable things that set the right figure for one base, the cohort, the gross retention underneath, and the expansion source, and the table to compute before anyone quotes a percentage.
Net revenue retention is the revenue from last year's customers this year, over their revenue last year. The question is what the quotient should be, and the answer is three more columns on the same table.
| Segment | NRR, typical | Gross retention, typical |
|---|---|---|
| Enterprise SaaS | 110 to 130 percent | 90 to 97 percent |
| Mid-market SaaS | 100 to 115 percent | 85 to 92 percent |
| SMB SaaS | 85 to 100 percent | 70 to 85 percent |
| Usage-priced infrastructure | 115 to 140 percent, volatile | 90 to 95 percent |
| Non-SaaS recurring, services retainers | 95 to 110 percent | 85 to 95 percent |
These are investor figures for public and late-stage companies. They are useful as a sense of scale, not as a target for one base.
NRR = revenue this period from customers active a year ago ÷ their revenue a year ago
A blended figure mixes cohorts that behave differently. By start year:
| Cohort | Customers a year ago | Revenue then | Revenue now from same customers | NRR |
|---|---|---|---|---|
| 2022 | 40 | $2,000,000 | $2,400,000 | 120% |
| 2023 | 60 | $2,400,000 | $2,500,000 | 104% |
| 2024 | 90 | $2,700,000 | $2,400,000 | 89% |
| All | 190 | $7,100,000 | $7,300,000 | 103% |
The blended 103 is fine. The 2024 cohort at 89 is the finding: the most recent customers, sold by the current team under the current pricing, are shrinking. The NRR worked example computes each cohort by hand.
Gross retention = revenue now from the same customers, capped at each customer's prior revenue ÷ their revenue a year ago
| Base | NRR | Gross retention | Expansion points |
|---|---|---|---|
| A | 110% | 95% | 15 |
| B | 110% | 80% | 30 |
The same NRR. Base A loses 5 percent a year and grows the rest; base B loses a fifth of its customers' revenue every year and covers it. B's number ends when its expansion does.
| Source | Points of NRR |
|---|---|
| Seats and usage | 8 |
| Additional products | 4 |
| Price increase | 18 |
| Total expansion | 30 |
Eighteen of thirty points from price. The number the board sees is 110; the number that describes what customers are doing is 92 plus a price rise.
| Measure | Formula | From |
|---|---|---|
| NRR, by cohort | Same customers' revenue now ÷ then | Billing or ledger, by customer, two periods |
| Gross retention, by cohort | Capped version of the same | Same |
| Expansion by source | Upsell, cross-sell, usage, price, separately | Billing with line detail |
| Contraction and churn, separately | Reduced ÷ then; lost ÷ then | Same |
| Identity | Then + expansion − contraction − churn = now | Same |
The identity is the check: if the four movements do not sum to the difference, a customer has been counted twice or a merged account has been missed.
Blended figure only. The newest cohort shrinking under a healthy average.
NRR without gross. Churn hidden by price rises until the year it is not.
Expansion unsplit. Growth attributed to customers who were merely charged more.
New customers included. New logos in the numerator; the figure is not retention at all.
A good net revenue retention is above 100 with gross retention above 90, in every cohort not just the blend, with expansion coming mostly from seats, usage and products rather than price. The segment ranges say whether 105 is high or low; the three columns say whether it will last. Covirage computes NRR, gross retention and the expansion split by cohort from the billing export every month, with the identity checked.
Roughly, enterprise 110 to 130 percent, mid-market 100 to 115, SMB 85 to 100, with wide spread inside each. Usage-priced products run higher and more volatile; seat-priced products with annual contracts run lower and steadier. An SMB product at 95 percent may be at its segment's top; an enterprise product at 105 may be at its bottom.
Because expansion can hide churn for a while and then stop. Gross retention of 80 means a fifth of the base leaves each year; the 30 points of expansion covering it will not survive a price freeze or a downturn. Gross retention is the floor the company is standing on; NRR is the floor plus what is stacked on it.
Upsell, cross-sell, usage growth and price increase, each separately. NRR that is mostly price rise is renting growth from the customer's tolerance. NRR that is mostly seat and product expansion is customers buying more. The split by source is on the same table as the total.