NRR measures "how much revenue are last year's customers generating now?" It contrasts with Gross Retention.
Formula
NRR = (Starting MRR + Expansion − Downgrade − Churn) / Starting MRR
- 100% = exactly maintained - 110% = expansion beats churn (good) - 120%+ = world-class SaaS - ≤90% = leaky bucket (growth stagnates)
Why it matters
- Shows whether you can grow from existing customers alone - Investors recognize 110%+ NRR as "Net Negative Churn" - If over half of ARR growth comes from NRR, you're very healthy
Korea/Japan B2B specifics
- **Korea**: expansion typically via upsell and seat growth — both product and headcount - **Japan**: annual contracts + ringi slow expansion, but churn is also low — 100% NRR is easy
Expansion plays
- Upgrade to higher-tier plans - Usage-based pricing - Team / seat expansion - Cross-sell (related products/modules) - Regional/entity expansion (e.g., Korea entity → Japan entity)
Tools
- ChartMogul / Baremetrics: cohort NRR - HubSpot / Salesforce: expansion pipeline - Mixpanel: usage-growth detection