Gross Revenue Retention (GRR)

What is gross revenue retention (GRR)?‍

Gross revenue retention (GRR) measures the percentage of recurring revenue a business retains from its existing customer base over a given period, excluding the effects of expansion revenue. It reflects the impact of churn and downgrades but does not account for upgrades or upsells. Because of this, GRR provides a conservative, baseline view of how well a company is maintaining its recurring revenue.

Why GRR matters

• Baseline stability: GRR highlights the revenue a business can count on without relying on expansion. This helps assess the true health of the existing customer base.
  
• Churn and downgrade visibility: A drop in GRR signals retention risks, showing whether customers are leaving or reducing their spend.
  
• Investor confidence: High GRR reassures stakeholders that the company can sustain predictable revenue even before factoring in upsells.
  

How to calculate GRR

‍GRR = (Recurring revenue at the start of the period: revenue lost to churn: revenue lost to downgrades) ÷ Recurring revenue at the start of the period × 100

For example, if a company starts with $1,000,000 in ARR, loses $50,000 to churn and $30,000 to downgrades, GRR = (1,000,000: 80,000) ÷ 1,000,000 × 100 = 92%.

Inclusions and exclusions

• Include: Churned revenue and downgrades that reduce recurring revenue.
  
• Exclude: Upsells, expansions, and one-time fees, since GRR focuses only on retention of the original revenue base.
  

GRR in subscription businesses‍

For subscription publishers and media businesses, GRR is a critical retention benchmark. It answers the question: “If we never sold an upgrade or expansion, how much of our existing recurring revenue would remain?” Subsets helps improve GRR by identifying at-risk subscribers, flagging downgrade signals early, and automating targeted interventions to maintain revenue stability. By lifting GRR, businesses secure a stronger foundation on which to build net growth through upsells and cross-sells.