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What’s a Good Level of Net Dollar Retention?

One SaaS metric we monitor closely is net dollar retention. Net dollar retention tells you what percent of revenue from current customers you retained from the prior year, after accounting for upgrades, downgrades, and churn.

Formulaically, net dollar retention is the beginning of period revenue + upgrades — downgrades — churn all divided by beginning of period revenue. If that formula yields a number greater than 100%, then growth from your existing customer base more than offset any losses from that customer base.

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