cust.co / Glossary / Gross Retention Rate (GRR)

Gross Retention Rate (GRR)

Percentage of recurring revenue retained from existing customers, EXCLUDING expansion. Measures pure churn + contraction loss.

Also known as: Gross Revenue Retention, Dollar-Based Gross Retention, GDR

Definition

Gross Retention Rate is the count-side complement to NRR. GRR = (Starting ARR - Contraction - Churn) / Starting ARR. Critically, it EXCLUDES expansion revenue, so GRR is always less than or equal to NRR. The gap between GRR and NRR (called the expansion contribution) tells you how much of NRR strength comes from upsell vs pure retention. >95% GRR is top-decile.

Formula

(Starting ARR - Contraction - Churn) / Starting ARR

Example

Starting ARR $1M - Contraction $50K - Churn $100K = $850K. GRR = $850K / $1M = 85%.

Related terms

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