Net revenue retention (NRR) is the percentage of recurring revenue retained from existing customers over a twelve-month period, accounting for churn, contraction, and expansion within the existing customer base. NRR is a critical metric in SaaS and subscription business diligence, with NRR above 100% indicating that expansion within existing customers more than offsets churn and contraction.
Australian sub-$20M SaaS businesses with NRR above 110% command meaningfully higher multiples than businesses with NRR below 100%, often by multiple turns of revenue.