Gross Revenue Retention Calculator for SaaS GRR Analysis

Define the beginning revenue cohort

To initiate your Gross Revenue Retention analysis, you must first define the starting monthly recurring revenue (MRR) of your selected customer cohort. This represents the total active contract value generated by a specific group of customers at the exact beginning of your observation period. It is critical to exclude any new customer revenues or reactivation values that occurred during the month from this starting baseline to ensure cohort purity.

Enter churned recurring revenue

Input the amount of monthly recurring revenue lost due to complete cancellations from the cohort during the period. This includes customers who deactivated their subscriptions, failed to renew their annual agreements, or went out of business. Fully churned revenue represents a total loss of the customer relationship.

Enter contraction recurring revenue

Record the revenue decline resulting from existing customers downsizing their subscription packages. Contraction occurs when active accounts downgrade their tiers, reduce user seat counts, remove add-on modules, or negotiate lower discount pricing. Unlike churn, contraction represents an ongoing relationship but at a decreased spend level.

Keep expansion and new revenue separate

A major rule of GRR modeling is that you must keep expansion, reactivation, and new logo revenues entirely separate. While they are crucial for measuring overall company growth, adding expansion back into the GRR equation violates core accounting standards. GRR is designed to evaluate raw cohort preservation, meaning it cannot exceed 100%. Keeping expansion separate allows you to detect if aggressive upselling is masking structural churn.

Step-by-step example

Let us look at a real-world scenario of a business cohort to understand the math:

• Starting cohort MRR: $100,000
• Contraction MRR: $3,000
• Churned MRR: $5,000
• Expansion MRR: $15,000 (Excluded from GRR)

Calculating GRR vs NRR

First, we calculate the Gross Retained Revenue:
Gross Retained Revenue = Starting MRR - Contraction - Churned = $100,000 - $3,000 - $5,000 = $92,000.

Second, we compute the Gross Revenue Retention (GRR):
GRR = ($92,000 / $100,000) * 100 = 92.00%.

Finally, we can compare this with NRR which includes the expansion MRR:
NRR = (($92,000 + $15,000) / $100,000) * 100 = 107.00%.

In this example, the high NRR of 107.0% might suggest rapid expansion, but the GRR of 92.0% shows that the cohort is losing 8.0% of its base revenue. This demonstrates why both metrics must be tracked together.