Dear SaaStr: How Should I Calculate Gross Dollar Retention For Our Investors?

Dear Sister: How should I calculate the overall dollar retention for my investors?

Grass Dollar Retail (GRR) is an important metric for sauce business, especially when you offer investors. This tells them how much your income is retained, except for how much income or extension of your income. The best practice method of calculating this is:

1. Start with your start (annual repeated revenue): These are measuring you at the beginning of this period by your current customers.

2. Freeze r: This is lost from users who canceled their purchase during the period.

3. Scharged the reduced ARR: It is wasted from users who stayed but reduced their costs (such as, went into a lower -level project).

4. Divide through the beginning: This provides you with a percentage of revenue revenue.

   Formula:
   GRR = (Starting Arr – Mandeed Arr – Down Grade Arr) ÷ Start Arr

   For example, if you have started with M 1M Arr, the drugs are lost from K 50K, and to grade K 50K to the bottom, your GRR will be:
   GRR = ($ 1M – $ 50K – $ 50K) ÷ $ 1M = 90 %.

Key Best Action to Offer GRR to Investors:

• UPSELLS AND DELIVER EXPERIENCE: GRR focuses on maintaining purely, not developing by current consumers. This makes it a more conservative and honest matriculation.

• Class through the Customer Type: Break the GRR through customer classes (eg, SMB, mid market, enterprise). Investors want to see where you are strong and where you may have challenges.

• Benchmark your GRR: Investors will compare your GRR to industry standards:

  • Enterprise sauce: 90-95 %
  • Mid-market sauce: 85-90 %
  • SMB sauce: 80-85 %
    These standards indicate potential issues of keeping anything below 3.

• Show trends over time: Investors want to see if your GRR is better, stable or falling. A permanent or improving creates confidence in the sticky of your product.

• Highlight the Ship Walking and Consumer Successful Investment: GRR is very much affected to what extent do you board the ship and help consumers. If you are spending 5-15 % of your income on consumer success (Scaled by ACV), make sure it is mentioned. Enterprise users' LIFE, it should be close to 12-15 % 3.

• Specify variants: If your GRR has more than 5 % quarter -quarter fluctuations, be prepared to explain. This may be caused by seasonal, customer mix, or other factors 3.

Investors care about the GRR as this product market is a proxy for fit and consumer satisfaction. A strong GRR suggests that your product works, your customers are happy, and your revenue base is stable. Apply this metric nail, and your pitch will have a solid foundation.

And here a great -related deep diver: here:

https://www.youtube.com/watch?v=a8e7ew36etk