Gross Revenue Retention (GRR)
The percentage of recurring revenue retained from existing customers, excluding any benefit from expansion or cross-sells.
FORMULA
GRR = (Starting ARR - Contraction ARR - Churned ARR) / Starting ARRWhy it matters
Gross Revenue Retention provides the unvarnished truth about customer satisfaction and core product utility. Because GRR mathematically cannot exceed 100%, it removes the masking effect of a few large customers expanding rapidly. A company might boast an impressive 110% NRR, but if its GRR is 75%, it is running a leaky bucket where massive expansion from power users is hiding severe churn among the broader base. Investors use GRR to assess the true floor of revenue stability. Consistently high GRR indicates that the product is sticky, switching costs are high, and the core value proposition is delivering on its promise.
2025 BENCHMARK
SaaS Capital's 2025 dataset indicates a median GRR of 89% across B2B SaaS, with enterprise-focused companies averaging 92%.
COMMON MISTAKES
- Accidentally including expansion revenue, turning the metric into NRR.
- Failing to account for dowgrades and only subtracting full logo churn.
- Measuring GRR on a gross dollar basis rather than a cohort basis.