Fig. 01 · Glossary
Net Revenue Retention (NRR)
Also known as Net Dollar Retention, NDR
Definition
Net Revenue Retention measures the dollar revenue from a cohort of customers one year later relative to what they paid at the start, including upsell and expansion, net of churn and contraction. NRR ≥ 110% is the floor for top-quartile B2B SaaS; ≥ 120% signals a category-leader product. The trap: high reported NRR can mask low gross retention because expansion from a few large accounts compensates for losses elsewhere. PE diligence pulls cohort-level GRR (Gross Retention) to detect the disguise.
We have seen sellers report 105% NRR and feel safe; the buyer’s diligence team computes 78% GRR on the same cohort and the deal restructures around 70% earnout. The gap between NRR and GRR is the single richest forensic signal we extract during commercial diligence.
For an operator: track NRR weighted by cohort vintage, segmented by deal size and industry. The aggregate number is a vanity metric. The breakdown tells you which sales motion is profitable and which is borrowing future revenue.
Human Renaissance glossary · operator-grade definitions · Research methodology
