Retention

The true measure of product-market fit

Retention measures your success at keeping customers and the revenue they generate over time. In the subscription economy, high retention is the clearest signal of product-market fit and the single greatest driver of long-term valuation. It is the core financial mechanism that determines Customer Lifetime Value (LTV).

To master the story of your customer base, retention must be viewed through both a customer-count lens and a revenue lens. We break down retention into three complementary measures that give you full insight into how much value you are retaining and generating from your existing base:

• Logo Retention: Tracks the percentage of your original customer count that remains active.
• Gross Revenue Retention (GRR): Tracks the percentage of revenue retained, excluding expansion revenue. This is your most conservative measure of revenue stability.
• Net Revenue Retention (NRR): Tracks the percentage of revenue retained, including revenue gained from customer upgrades (expansion). This is the key metric for built-in revenue growth.