The craziness of the quarter has ended (or will end hopefully!).
And now 2 words are being repearted and talked about in board rooms and management meetings, GRR and ARR. GRRÂ and ARR.
So to make sure you understand the next QBR, understanding how Gross Retention Rate (GRR), churn and Annual Recurring Revenue (ARR) interconnect is crucial.
GRR measures the percentage of revenue retained from existing customers, excluding upsells and expansions. It’s all about the dollars you’re keeping from your current base.
This is a solid sign of customer satisfaction and loyalty.
ARRÂ reflects the total annual revenue expected from existing subscriptions, including renewals, upsells, and new customers. It shows the company's revenue growth trajectory.
High GRR supports a strong, stable ARR.
Stable revenue from existing customers (high GRR) sets a solid baseline
Management and shareholders especially love predictability.
High GRR means stable revenue, reducing the risk of churn. Combine that with a growing ARR, and your company is in solid shape.
If you haven’t noticed yet, you are more than just a lawyer. You’re at the unique level to be close to management so learn how to speak like management.
Think you're a SaaS contracting pro? Download "10 Contract Basics to Know as a SaaS Attorney".
Commentaires