Gross Revenue Retention (GRR)
Gross Revenue Retention (GRR) measures the percentage of recurring revenue retained from existing customers, accounting only for downgrades and churn — not expansion. Unlike NRR, GRR can never exceed 100%. It tells you how much revenue you keep before any upselling effort.
Why Gross Revenue Retention (GRR) Matters for SaaS Companies
GRR is the floor of your retention story. NRR can look healthy at 110% while masking the fact that you are losing 20% of your base and making it up through aggressive upselling. Investors — especially post-2022 — scrutinize GRR because it reveals the underlying health of your product-market fit without the sugar coating of expansion revenue. A GRR below 85% means your product has a fundamental retention problem.
Formula
GRR = (Starting MRR - Contraction - Churn) / Starting MRR x 100
Benchmark
Best-in-class B2B SaaS: 95%+. Good: 90-95%. Concerning: 85-90%. Red flag: below 85%.
Tools for Measurement
An Operator's Take
I have seen companies celebrate 120% NRR while their GRR was 78%. Translation: they were losing over a fifth of their revenue every year but compensating with upsells to surviving accounts. That works until you run out of upsell headroom — which at BatchService was exactly what happened. The top 20% of accounts were already on the highest tier. When we stopped relying on expansion to mask churn and instead fixed the retention problem directly, GRR went from 82% to 93%. That is more durable growth than any upsell motion.
Common Mistakes
What I see go wrong at Seed to Series B companies.
Only tracking NRR and ignoring GRR. NRR can hide a retention problem behind expansion revenue. Always track both.
Including expansion revenue in GRR calculations. GRR is exclusively about retention — downgrades and churn only. If your GRR exceeds 100%, your formula is wrong.
Not comparing GRR across customer segments. Enterprise GRR of 98% alongside SMB GRR of 72% tells you exactly where the product-market fit problem lives.
What to Do This Week
Concrete steps you can take right now.
Calculate GRR separately from NRR for your last 4 quarters. If GRR is declining while NRR holds steady, your expansion is masking a growing retention problem.
Segment GRR by customer plan tier. Find which tiers have the weakest retention.
If GRR is below 90%, audit your top churned accounts to identify the root causes — product gaps, poor onboarding, pricing misalignment, or competitive displacement.
Related Resources
Try These Tools
Further Reading
Frequently Asked Questions
What is the difference between GRR and NRR?
GRR only accounts for revenue lost (churn and downgrades) and cannot exceed 100%. NRR also includes revenue gained from existing customers (upsells, cross-sells) and can exceed 100%. GRR measures how well you retain. NRR measures how much your existing base is worth over time. Both are essential.
What is a good GRR for SaaS?
Best-in-class B2B SaaS companies maintain GRR above 95%. The median for B2B SaaS is around 90%. Below 85% is a red flag that indicates fundamental product-market fit or pricing issues. Enterprise-focused companies tend to have higher GRR than SMB-focused ones.
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