---
title: SaaS Net and Gross Revenue Retention Benchmarks
description: Benchmarks for SaaS net revenue retention (NRR) and gross revenue retention (GRR), what good looks like, and how to calculate both from your data.
canonical: https://www.scalexp.com/blog/saas-benchmarks-revenue-retention/
---
# SaaS Revenue Retention Benchmarks: GRR and NRR

Benchmarks for SaaS net revenue retention (NRR) and gross revenue retention (GRR), what good looks like, and how to calculate both from your data.

**Short answer:** gross revenue retention (GRR) measures the recurring revenue you keep from existing customers before expansion, and net revenue retention (NRR) adds expansion back in; this guide shows how to calculate both and what the benchmark data says. ScaleXP calculates NRR, GRR and churn among its 30+ SaaS metrics from Xero or QuickBooks data, and connecting a CRM extends the metrics.

This article is part of our series on the [latest SaaS benchmarks](https://www.scalexp.com/saas-benchmarks/), focusing on revenue retention. It covers gross and net revenue retention, how each is calculated, what the benchmark data shows, and what you can do to improve them. In an environment of rising costs and pressure on profits, revenue retention is more important than ever for SaaS companies.

**Try it with your numbers:** the [gross revenue retention calculator](https://www.scalexp.com/saas-metrics-library/gross-net-revenue-retention/#sxl-grr-calculator) in the ScaleXP SaaS Metrics Library works out GRR from the ARR you retained and the ARR you started with a year ago.

## Why revenue retention matters

Here are a few reasons why revenue retention rates are more critical than ever:

1. **Focus has shifted from growth to execution**: Unlike recent years where growth at any cost was the mantra, 2023 has seen a shift to investor focus on sustainable growth, with a significant emphasis on revenue retention as a measure of business health and long-term viability. In OpenView’s 2023 SaaS Benchmarks report, 73% of founders were worried about go-to-market execution; this compares to just 59% who were worried about execution in 2021.
2. **Investors rank strong retention first in their ranking of attractiveness in the SaaS industry:** The 2023 [SEG survey of 135 top SaaS buyers and investors](https://softwareequity.com/research/saas-ma-buyers-perspectives), taken in August 2023 found that **71% ranked “strong retention / mission critical”** as a top quality of an attractive SaaS company in the current market, well above any other survey response.
3. Cost effective growth: In an environment increasingly focused on efficiency and profitability retaining existing customers is a key component of demonstrable efficient growth. Companies which excel in customer retention can grow steadily and predictably without the constant need for high customer acquisition spending.

## Understanding revenue retention in SaaS

[Revenue retention](https://www.scalexp.com/saas-metrics-library/gross-net-revenue-retention/), at its core, measures the ability of a company to retain its customers and revenue over time. It is a critical indicator of customer satisfaction, product value, and overall company health.

Revenue retention is measured through metrics such as net revenue retention, also known as net dollar retention (NDR), gross revenue retention, and churn rate.

## What is gross revenue retention?

Gross Revenue Retention refers to the percentage of revenue retained from existing customers within a specific timeframe, typically a year. It’s a vital indicator of customer loyalty and product value, as it reflects the company’s ability to maintain its revenue base in the face of customer churn and downgrades.

Key points about gross revenue retention:

Measures churn impact: Gross revenue retention looks at the amount of revenue retained from a prior period after taking into account revenue lost due to customers canceling (churn) or downgrading their services.

Excludes upsell revenue: Gross revenue retention focuses solely on the retained revenue from existing customers, not accounting for any additional revenue gained through upselling or cross-selling.

**Usually quoted on an annual basis.** This can be measured either over a year or annualized from a shorter time period.

Indicator of customer satisfaction and long-term revenue stability.

## How is gross revenue retention calculated?

Gross revenue retention is calculated as shown below.

![Formula for calculating gross revenue retention percentage with variables and mathematical symbols.](https://www.scalexp.com/wp-content/uploads/2024/02/Group-1111112052-1024x284.png)

*Gross revenue retention formula by ScaleXP – https://www.scalexp.com*

Gross revenue retention is generally calculated as one minus the sum of annual revenue from all lost and downgraded contracts divided by recurring revenue a year ago. In other words, 100% less the % revenue lost over the course of the year. In many cases, the churn rate is calculated on a monthly basis and multiplied by 12 to get to an annual rate. Similarly a quarterly rate can be annualized by multiplying churn by 3 and then subtracting from 100%.

## What is net revenue retention?

[Net revenue retention](https://www.scalexp.com/saas-metrics-library/gross-net-revenue-retention/) refers to the percentage of recurring revenue retained from existing customers over a specific period, usually a year, including any additional revenue from upsells, cross-sells, or price increases, while also accounting for churn and downgrades. It provides a view of customer retention which includes increases in the base retained.

Key points about net revenue retention:

- Measures churn impact: Like gross revenue retention, net revenue retention accounts for lost revenue due to customers canceling (churn) or downgrading their services.
- Includes revenue expansion: Unlike gross revenue retention, net revenue retention includes upside from existing customers to partially offset the impact of customers lost or downgrades. Net revenue retention is therefore generally higher than gross revenue retention and, unlike gross revenue retention, can be greater than 100%. This is because net revenue retention includes additional revenue gained from existing customers through upsells or service enhancements.
- **Usually quoted as an annual rate.** This is similar to gross revenue retention.
- **Indicator of customer loyalty and revenue predictability.** Like gross revenue retention, net revenue retention is an important indicator of the long term viability and health of recurring revenue streams

## How is net revenue retention calculated?

Net revenue retention is calculated as shown below.

![Graphic illustrating the net revenue retention formula with variables for upsells, lost contracts, and downgrades.](https://www.scalexp.com/wp-content/uploads/2024/02/Group-1111112053-1024x284.png)

*Net revenue retention formula by ScaleXP – https://www.scalexp.com*

Net revenue retention is calculated by taking all expansion revenue generated over the period and subtracting all revenue lost or downgraded. This is divided by total recurring revenue from the prior period to get the net churn rate as a percentage which is then added to 100% to get the net revenue retention rate. The usual measurement period is one year. Often this is generated by calculating the net revenue churn rate for a shorter period and multiplying by the number of periods in a year — so 12x monthly net churn or 3x quarterly net churn. This is then added to 100 to get the annual revenue retention rate.

### Worked example: GRR and NRR

The formulas, using annual recurring revenue (ARR) from the customers you had at the start of the year:

- GRR = (starting ARR – churned ARR – contraction ARR) / starting ARR
- NRR = (starting ARR – churned ARR – contraction ARR + expansion ARR) / starting ARR

A company starts the year with $1,000,000 of ARR from its existing customers. During the year, those customers cancel $80,000 of ARR, downgrade $20,000 and add $150,000 through upgrades and price increases. Revenue from customers acquired during the year is left out of both measures.

- GRR = ($1,000,000 – $80,000 – $20,000) / $1,000,000 = 90%
- NRR = ($1,000,000 – $80,000 – $20,000 + $150,000) / $1,000,000 = 105%

The figures are illustrative. GRR can never exceed 100%, because it ignores expansion; the 15-point gap between the two measures here is the expansion revenue.

## How is customer retention different from revenue and logo retention?

[Customer retention rate](https://www.scalexp.com/saas-metrics-library/customer-retention-rate/) refers to the ability to retain customer numbers, irrespective of relative size.

Revenue retention looks at the monetary value of customer retained rather than the number of customers.

Customer retention and churn rates are also sometimes called logo retention and churn rates to indicate that it is the customer group being measured rather than the individual person.

## Importance of revenue retention for SaaS companies

Revenue retention is critical for company valuation, including [public and private SaaS multiples](https://www.scalexp.com/blog/saas-benchmarks-arr-valuation/), as it proves long-term value and profitability. Investors are now placing more emphasis than ever on long-term strategic advantage built on strong product and high levels of customer loyalty as evidenced by high retention rates.

Here are some of the reasons high revenue retention rates are so highly valued by investors:

- Long-term customer relationships: High retention rates indicate that customers find continuous value in the product, leading to a stable and predictable revenue stream. High gross revenue retention rates reflect customer satisfaction and the perceived value of the product, as customers are willing to spend more over time.
- Lower cost of sales: Acquiring a new customer can cost significantly more than retaining an existing one. A focus on retention improves the company’s overall efficiency and profitability.
- Upsell opportunities: A retained customer base presents opportunities for upselling and cross-selling, contributing to revenue growth without the corresponding increase in acquisition costs.
- **Higher lifetime customer value .** [Customer Lifetime Value (CLV or LTV)](https://www.scalexp.com/saas-metrics-library/customer-lifetime-value/) is a measure of the total value of each customer to the business over time. Higher customer retention means lower [churn](https://www.scalexp.com/saas-metrics-library/customer-churn/) and higher value per customer.
- Growth Indicator: Gross revenue retention is a powerful indicator of organic growth. A rate over 100% signifies that revenue from existing customers is growing, which is crucial for long-term success without solely relying on new customer acquisition. Investors often favor SaaS companies with high revenue retention, as it indicates a sustainable and expanding revenue base.
- Market competitiveness: In a crowded market, strong revenue retention can set a company apart, indicating a robust business model capable of thriving through upselling and cross-selling opportunities.
- In addition, understanding revenue retention helps companies make informed decisions about product development, pricing strategies, and customer success initiatives.

## What are the latest SaaS revenue retention benchmarks?

The most recent public benchmark with a disclosed sample is the 2026 SaaS & AI Performance Benchmarks report from Aleph and Benchmarkit, published on June 1, 2026. It covers full-year 2025 actuals from 342 B2B SaaS and AI-native software companies; 226 reported gross revenue retention and 230 reported net revenue retention. The median company kept 84% of its revenue before expansion, down from 88% the year before, and 102% after expansion.

The table shows the 2025 medians by segment. The report does not publish gross revenue retention by ARR band, so those cells are marked as not reported.

| Segment (2025 data) | Median GRR | Median NRR |
|---|---|---|
| All companies | 84% | 102% |
| Top quartile | 91% | 110% |
| Bottom quartile | 76% | 92% |
| Under $5M ARR | Not reported | 94% |
| $20M to $50M ARR | Not reported | 101% |
| Over $100M ARR | Not reported | 103% |
| Sales-led go-to-market | 88% | Not reported |
| Product-led go-to-market | 79% | Not reported |
| Contract value under $5K a year | 80% | 98% |

Source: [Aleph, gross revenue retention benchmarks](https://www.getaleph.com/answers/gross-revenue-retention-saas-2026) and [Aleph, net revenue retention benchmarks](https://www.getaleph.com/answers/net-revenue-retention-saas-2026), both summarizing the 2026 Aleph and Benchmarkit report; checked November 2, 2026.

Read together, the two medians leave an 18-point gap: expansion from existing customers covers most of the revenue lost to churn and downgrades. A company with net revenue retention near the median but gross revenue retention well below 84% is relying on upsells to hide churn.

### 2023 trend data

The OpenView and SEG figures below are from 2023. They are kept as trend data, to show how retention has moved since then, and should not be used as current benchmarks.

The table below shows the average net revenue retention rate and gross revenue retention rate for SaaS companies by size in 2023 and prior years. This reflects a survey of over 3,500 SaaS companies across the globe by [OpenView Partners](https://openviewpartners.com/).

Despite increased investor focus on revenue retention as a measure of success, many SaaS companies found 2023 challenging as their customers were also under increased pressure to demonstrate efficiency and cut costs. Median gross and net retention rates were flat or reduced versus the prior year for companies of every size, in most cases dropping 5 percentage points or more in gross revenue retention, from the low/mid 90s to the 80s – and falling closer to 100% on a net revenue retention basis.

![Table displaying 2023 gross revenue retention data segmented by company size with median values.](https://www.scalexp.com/wp-content/uploads/2024/02/Screenshot-2024-02-05-143419.png)

*Source: OpenView 2023 SaaS Benchmarks Report*

The chart below illustrates the challenges faced by SaaS companies in 2023, with even the top quartile generally retaining only 95% or less of customer revenue before taking into account offset from price increases, some 5 percentage points lower than in 2022. This reflects the impact of challenging economic conditions and high levels of scrutiny of purchases, including consolidation of vendors by purchasers.

![Line chart displaying gross dollar retention rates segmented by ARR categories including bottom quartile, median, and top quartile.](https://www.scalexp.com/wp-content/uploads/2024/02/Screenshot-2024-02-05-150440-1024x618.png)

*Source: OpenView 2023 SaaS Benchmarks Report*

Net revenue retention was also significantly lower than in 2022, most notably for larger and higher performing companies who tended to be more reliant on expanding existing customer revenue relative to gaining new customers. Net revenue retention was, on average, at or near 100% across most revenue bands.

![Line chart displaying net dollar retention percentages segmented by annual recurring revenue (ARR) categories.](https://www.scalexp.com/wp-content/uploads/2024/02/Screenshot-2024-02-05-150608-1024x666.png)

*Source: OpenView 2023 SaaS Benchmarks Report*

## Method and sources

Each benchmark on this page, with the details needed to judge it:

| Source and publisher | Data year | Sample | Geography | Use |
|---|---|---|---|---|
| 2026 SaaS & AI Performance Benchmarks, Aleph and Benchmarkit (published June 1, 2026) | Full-year 2025 | 342 B2B SaaS and AI-native companies (GRR 226, NRR 230) | Not stated | Current benchmark |
| 2023 SaaS Benchmarks Report, OpenView Partners | 2023 | Over 3,500 SaaS companies | Global | Trend only (older than 2025) |
| SaaS M&A buyers’ perspectives survey, Software Equity Group | August 2023 | 135 SaaS buyers and investors | Not stated | Trend only (older than 2025) |

The Aleph and Benchmarkit figures were checked on November 2, 2026. The 2023 figures are quoted as originally published. Survey definitions of GRR and NRR can differ slightly, so compare your own figures on the formulas shown above. ScaleXP publishes this guide.

## Strategies for improving revenue retention

- Personalized customer experiences: Tailoring the customer experience based on individual needs and feedback. This works well in small, early stage SaaS companies and in larger SaaS businesses able to systematize and automate the ability to segment needs and personalized service via the latest technology, increasing incorporating elements of AI.
- Focus on customer success: Developing a robust customer success strategy that ensures customers achieve their desired outcomes with your product. As SaaS companies grow, having a professional, dedicated focus on helping existing customers retain and expand upon the value they receive is critical for customer retention.
- Product improvement: Continuously enhancing the product based on customer feedback and evolving market needs.
- Proactive engagement: Regularly engaging with customers to understand their challenges and pre-empt potential churn.

## What investors are looking for

The focus on revenue retention continues to intensify. SaaS companies that can demonstrate strong retention metrics are likely to see continued investor interest and market success.

## Conclusion

ScaleXP calculates net and gross revenue retention automatically from Xero or QuickBooks Online and HubSpot, Salesforce or Pipedrive, so finance teams track retention against these benchmarks every month from the same numbers as the financial statements.

## Frequently asked questions

### What is a good net revenue retention benchmark for SaaS?

A good net revenue retention rate for SaaS is 100% or higher: the median for full-year 2025 was 102%, with the top quartile at 110%, in the 2026 Aleph and Benchmarkit benchmarks of 342 companies. The OpenView 2023 SaaS Benchmarks Report put net revenue retention at around 100% across most revenue bands, while median gross revenue retention fell from the low to mid 90s in 2022 to the 80s in 2023. Holding NRR above that line signals durable, expanding revenue to investors. ScaleXP calculates NRR and GRR automatically from Xero or QuickBooks Online and the CRM, so finance teams know exactly where they stand against the benchmark every month and can act early on churn.

### What is a good gross revenue retention benchmark for SaaS?

A gross revenue retention rate of 85% or higher is a common goal for B2B SaaS, and 90% or more is top-quartile. In the 2026 Aleph and Benchmarkit benchmarks, covering full-year 2025 data, the median was 84%, down from 88% a year earlier, with the top quartile at 91% and the bottom quartile at 76%. Sales-led companies retained 88% at the median, against 79% for product-led companies.

### Can ScaleXP calculate NRR and GRR automatically from Xero and HubSpot?

Yes, ScaleXP calculates net revenue retention and gross revenue retention automatically from Xero or QuickBooks Online, combined with HubSpot, Salesforce or Pipedrive. ScaleXP tracks every customer’s recurring revenue over time, separating expansion, contraction and churn so both NRR and GRR are calculated consistently. Because the figures come from invoices rather than CRM estimates, they reconcile to the financial statements. Finance teams stop rebuilding retention formulas in spreadsheets and present revenue retention metrics investors trust.

### How does ScaleXP show what drives changes in revenue retention?

ScaleXP shows what drives changes in revenue retention through an ARR waterfall, cohort analysis and customer-level drill-down. ScaleXP splits movements into expansion, contraction, churn and reactivation, and breaks retention down by customer segment, so teams see exactly which accounts moved the number. Natalie, Director of Operations, explains: “Being able to see which of our customers are churning, identifying who we’ve missed billing that month was invaluable, the missed invoices that show as red / churned probably saved us around £100k!”

### How does ScaleXP make SaaS revenue retention metrics investor-ready?

ScaleXP makes SaaS revenue retention metrics investor-ready by calculating them from accounting data and presenting them in board-ready formats. ScaleXP builds NRR, GRR, logo churn and revenue churn from Xero, QuickBooks Online or Zoho Books invoices, so every figure ties back to the financial statements. Live dashboards and PowerPoint board packs show retention trends with drill-down to the customer, and investors can follow each movement. Finance leaders answer diligence questions on retention instantly and present a credible story of durable, growing revenue.

How ScaleXP does this

ScaleXP calculates MRR, ARR, churn, retention and more from your CRM and accounting data, with no spreadsheets. [See ScaleXP’s SaaS metrics](https://www.scalexp.com/saas-metrics/)