NRR & Renewal Rate — Business User Guide

What is the Renewal Rate Report?

The Renewal Rate report (also referred to as NRR — Net Revenue Retention) helps you understand how your recurring revenue changes over time. It compares two equal time periods and shows you exactly where your money is growing, staying flat, or shrinking — broken down by individual client.

You can find this report on the MRR page, under the Renewal Rate tab.

Screenshot Walkthrough

📷 Screenshot Placeholder
Insert the Renewal Rate dashboard screenshot here using Insert → Files & Images in Confluence.

Below is a detailed explanation of every section visible on the Renewal Rate dashboard, using real data from a sample period (06/01/2026 – 06/30/2026).

Section 1 — The Three Gauge Charts (Top Row)

These gauges give you an instant health check of your portfolio. Below each gauge, a summary line shows the trend:

Gauge	What It Means
Renewal Rate: 88.0% Avg revenue/customer: £2.86k → £2.93k (▲ +£76.77)	Measures how much of your starting revenue you kept. 88% means you retained almost 9 out of every 10 pounds of baseline revenue. The needle is in the blue zone — this is healthy.
Gross Churn: 12.0% Customer count: 295 → 271 (▼ -24)	Shows the percentage of revenue lost because clients stopped spending entirely. 12% sits in the amber zone — worth watching, but not yet critical.
Customer Churn: 17.0% Total portfolio MRR: £842.27k → £794.55k (▼ -£47,720.22)	Shows the percentage of your client base that left. 17% (51 out of 295 clients churned) is in the amber-to-red zone — this deserves investigation.

💡 Why Customer Churn is higher than Gross Churn

In this example, Customer Churn (17%) is higher than Gross Churn (12%). This means the clients who left tended to be smaller accounts — they represented a smaller share of revenue (12%) than they did of the total client count (17%). If the opposite were true (Gross Churn higher than Customer Churn), it would mean your larger accounts were leaving — a more serious situation.

Section 2 — Summary Statistics (Middle Row)

Three lines summarise the big-picture changes between the two periods:

Statistic	Previous Period	Current Period	Change	What This Means
Average revenue per customer	£2.86k	£2.93k	▲ +£76.77	Despite losing customers, the ones who stayed became slightly more valuable on average — a positive sign.
Number of customers	295	271	▼ -24	The customer base shrank by 24 clients (51 churned, 27 new added, net = -24).
Total portfolio MRR	£842.27k	£794.55k	▼ -£47,720.22	Overall recurring revenue decreased by approximately £47.7k — driven primarily by churn.

Section 3 — Category Breakdown (The Six Cards)

This is the core of the report. Every client is placed into exactly one of six categories:

Category	Value	Client Count	What It Represents
BASE	£842.27k	295	The starting line. Total revenue from ALL clients in the previous period. Every other number is measured relative to this.
RENEWAL	£630.45k	213	Clients who spent the exact same amount in both periods. This is your stable, predictable revenue. 213 out of 295 clients (72%) stayed flat.
UPGRADE	£13.53k	11	Growth from existing clients. 11 clients increased their spending, generating an extra £13.53k. This is organic growth.
NEW BIZ	£75.04k	27	Brand-new revenue. 27 clients appeared in the current period who weren't there before. They brought £75.04k in fresh revenue.
DOWNGRADE	−£32.16k	20	Partial loss. 20 clients reduced their spending but didn't leave entirely. You lost £32.16k from these accounts.
CHURN	−£104.13k	51	Complete loss. 51 clients from the previous period are entirely gone. This cost £104.13k in lost revenue.

🔍 How to Verify the Numbers Add Up

The six categories should satisfy this relationship:

Total MRR (Current Period) = BASE + UPGRADE + NEW BIZ + DOWNGRADE + CHURN

Using the sample data: £842.27k (Base) + £13.53k (Upgrade) + £75.04k (New Biz) − £32.16k (Downgrade) − £104.13k (Churn) = £794.55k ✓

And: BASE = RENEWAL revenue + UPGRADE starting revenue + DOWNGRADE starting revenue + CHURN starting revenue

Section 4 — Client Detail Table (Bottom)

The table at the bottom lists every individual client with five columns:

Column	What It Shows	Example
Client Name	The company name	Website Energizers LTD
Category	Colour-coded badge showing their classification	● renewal, ● upgrade, ● churn, etc.
Previous MRR (£)	Their total monthly spend in the earlier period	2,700.00
Current MRR (£)	Their total monthly spend in the current period	2,700.00
Delta (£)	The exact difference (Current − Previous)	0.00 (flat), +1,000.00 (growth), −1,500.00 (decline)

How to use this table:

Sort by Delta descending to find your biggest upgrades
Sort by Delta ascending to find your biggest churn losses
Use the Search box to find a specific client by name
Filter by Category to isolate all churned clients, all upgrades, etc.

How Every Metric Is Calculated — Complete Formula Reference

This section explains exactly how every number on the dashboard is derived, in plain English with worked examples.

Step 1 — Calculate MRR Per Client Per Period

For each client, the system adds up all their qualifying recurring revenue across the selected period. Each invoice amount is divided by the number of months it covers to arrive at the monthly figure.

📝 Example
A client has a £1,200 annual invoice for prospecting services. The system divides £1,200 by 12 months = £100/month contribution to that client's MRR for each month the invoice covers.

Step 2 — Compare Each Client Across Both Periods

For every client who existed in the previous period:

Scenario	Classification
They appear in the current period with the same MRR	→ RENEWAL
They appear in the current period with a higher MRR	→ UPGRADE (the increase is tracked separately)
They appear in the current period with a lower MRR	→ DOWNGRADE (the decrease is tracked separately)
They do not appear in the current period at all	→ CHURN

Then, for every client in the current period who was not in the previous period:

Scenario	Classification
Brand-new client	→ NEW BIZ

Step 3 — Calculate the KPIs

Base Value

What it is: The sum of all clients' MRR in the previous period.

Formula: BASE = Sum of MRR for every client in the previous period

Example from screenshot: BASE = £842.27k (from 295 clients)

Renewal Rate (%)

What it is: The percentage of baseline revenue you kept (excluding churned revenue).

Formula: Renewal Rate = (BASE − |CHURN|) ÷ BASE × 100

Example from screenshot: (£842.27k − £104.13k) ÷ £842.27k × 100 = 87.6% → rounded to 88.0%

Interpretation: 88% of your starting revenue was retained. The remaining 12% was lost to churn.

Gross Churn (%)

What it is: The percentage of baseline revenue lost to clients who left entirely.

Formula: Gross Churn = |CHURN| ÷ BASE × 100

Example from screenshot: £104.13k ÷ £842.27k × 100 = 12.4% → rounded to 12.0%

Interpretation: For every £100 of baseline revenue, £12 walked out the door.

Customer Churn (%)

What it is: The percentage of your client base that left entirely.

Formula: Customer Churn = CHURN COUNT ÷ BASE COUNT × 100

Example from screenshot: 51 churned clients ÷ 295 total clients × 100 = 17.3% → rounded to 17.0%

Interpretation: Approximately 1 in 6 clients left during this period.

Net Revenue Retention — NRR (%)

What it is: The ultimate measure of revenue growth/decline from your existing customer base. NRR above 100% means your existing customers are generating more revenue than before (even before counting new business). Below 100% means they're generating less.

Formula: NRR = (BASE + UPGRADE + DOWNGRADE + CHURN) ÷ BASE × 100

Note: NEW BIZ is deliberately excluded from NRR because NRR measures revenue from existing relationships only.

Example from screenshot: (£842.27k + £13.53k − £32.16k − £104.13k) ÷ £842.27k × 100 = £719.51k ÷ £842.27k × 100 = 85.4%

Interpretation: Your existing customer base is generating 85.4% of what it was before — a net decline of 14.6%. This is a signal that churn and downgrades are outweighing upgrades.

Average Revenue Per Customer

What it is: The typical MRR per client, used to see if your customer value is trending up or down.

Formula: Avg Revenue = Total MRR ÷ Number of Customers (calculated separately for each period)

Previous period: £842.27k ÷ 295 = £2.86k per customer
Current period: £794.55k ÷ 271 = £2.93k per customer
Delta: +£76.77 per customer

Interpretation: Even though total revenue dropped, the average remaining customer became more valuable — a positive quality-over-quantity signal.

Total MRR Delta

What it is: The net change in total portfolio MRR between the two periods.

Formula: Total MRR Delta = Current Total MRR − Previous Total MRR = UPGRADE + NEW BIZ + DOWNGRADE + CHURN

Example from screenshot: £794.55k − £842.27k = −£47,720.22

Cross-check using categories: £13.53k + £75.04k − £32.16k − £104.13k = −£47,720.22 ✓

Customer Count Delta

What it is: The net change in number of customers.

Formula: Customer Count Delta = Current Customer Count − Previous Customer Count = NEW BIZ COUNT − CHURN COUNT

Example from screenshot: 271 − 295 = −24

Cross-check using categories: 27 new − 51 churned = −24 ✓

Summary Formula Cheat Sheet

KPI	Formula	Screenshot Example
Renewal Rate	(BASE − \|CHURN\|) ÷ BASE × 100	(842.27 − 104.13) ÷ 842.27 × 100 = 88.0%
Gross Churn	\|CHURN\| ÷ BASE × 100	104.13 ÷ 842.27 × 100 = 12.0%
Customer Churn	CHURN COUNT ÷ BASE COUNT × 100	51 ÷ 295 × 100 = 17.0%
NRR	(BASE + UPGRADE + DOWNGRADE + CHURN) ÷ BASE × 100	(842.27 + 13.53 − 32.16 − 104.13) ÷ 842.27 × 100 = 85.4%
Avg Revenue (Previous)	BASE ÷ BASE COUNT	842.27k ÷ 295 = £2.86k
Avg Revenue (Current)	Current Total MRR ÷ Current Customer Count	794.55k ÷ 271 = £2.93k
Total MRR Delta	Current Total − Previous Total	794.55k − 842.27k = −£47.72k
Customer Count Delta	Current Count − Previous Count	271 − 295 = −24

Which Products Are Included in NRR?

The NRR calculation does not include every product and service. It filters to only count recurring revenue items — products that represent ongoing, repeatable monthly spend. One-off charges, setup fees, and non-recurring items are excluded to ensure the numbers reflect true recurring revenue.

Below is the complete list of all products in the system, with their inclusion status:

✅ Included in NRR (Recurring Revenue Items)

These 18 products count toward the NRR calculation:

ID	Product Name	Description
2	Monthly fees	Fee for prospecting services (e.g. 750 prospect credits @ £2.00)
3	One Time Campaign	Campaign-based services
8	LinkedIn 100% Rebate	LinkedIn account coverage (full rebate)
9	LinkedIn Acct 50% Rebate	LinkedIn account coverage (50% rebate)
12	Sales Prospecting — LinkedIn Sales Navigator	LinkedIn Sales Navigator prospecting
13	Group Invoicing	Consolidated group billing
14	Bad Debt Write-off	Written-off bad debt (negative revenue adjustment)
18	Monthly fees US	Fee for prospecting services — US region
19	GiftBox	GiftBox service
20	GiftBox	GiftBox service (second variant)
21	Sales Prospecting — LinkedIn Connections Service	LinkedIn Connections prospecting
22	SoPro Prospecting — Phone Finder	Phone number discovery service
23	SoPro Prospecting — Intent Tracking	Intent tracking service
24	Sales Prospecting — LinkedIn Connections Service	LinkedIn Connections (second variant)
25	SoPro Prospecting — Phone Finder	Phone Finder (second variant)
26	SoPro Prospecting — Intent Tracking	Intent Tracking (second variant)
27	Sales Prospecting — LinkedIn Sales Navigator USA	LinkedIn Sales Navigator — US region
28	Platform Fee Service	Platform usage fee
29	Platform Fee Service	Platform usage fee (second variant)

❌ Excluded from NRR (Non-Recurring / One-Off Items)

These 8 products are not counted because they are one-time charges, setup fees, or non-recurring services:

ID	Product Name	Reason for Exclusion
1	Setup Invoice	One-off campaign setup fee — not recurring
4	Ninja	Not classified as recurring revenue
5	Tech	Technical service — not recurring
6	Custom	Custom/adhoc service — not recurring
7	Email Append	One-off data enrichment service
15	Revalidate and Recontact	One-off data refresh service
16	Toolset Subscription	Toolset subscription — tracked separately from prospecting MRR
17	Setup Invoice US	One-off campaign setup fee (US) — not recurring

💡 Why This Matters
Including one-off fees like Setup (ID 1) or Setup Invoice US (ID 17) would inflate your NRR numbers and hide the true health of your recurring revenue. By excluding them, the report gives you a clean view of repeatable, ongoing revenue — which is what investors, boards, and leadership teams care about most.

How to Interpret the Numbers — Decision Guide

Scenario 1: NRR > 100% (Growing)

What it looks like: Upgrades + New Biz outweigh Churn + Downgrades. Total MRR is higher than before.

What to do:

Identify why upgrades are happening — can you replicate that success with other clients?
Ensure new business clients are properly onboarded so they don't churn early
Keep monitoring — growth can mask early warning signs

Scenario 2: NRR = 90–100% (Stable with Slight Decline)

What it looks like: Churn and downgrades are eating into growth. You're retaining most revenue but slowly shrinking. (The screenshot example falls here at 85.4%.)

What to do:

Focus on the Churn category — these are your biggest leaks. Can any be saved?
Look at Downgrade clients — why are they reducing spend? Is it budget, competition, or dissatisfaction?
Check if the churning clients share any common characteristics (industry, size, product, account manager)

Scenario 3: NRR < 90% (Declining — Needs Attention)

What it looks like: Significant revenue loss. Churn is outpacing all growth.

What to do:

Immediate churn analysis — contact every churned client if possible to understand why
Review the client detail grid sorted by Delta (ascending) to see the biggest losses
Escalate to leadership — this trend is unsustainable
Consider whether pricing, product, or service quality issues are driving clients away

Colour Coding Reference

The client table uses coloured badges to help you spot patterns at a glance:

Colour	Category	Business Meaning	Recommended Action
Grey	Renewal	Stable revenue — no change	Monitor for cross-sell/upgrade opportunities
Blue	Upgrade	Growing revenue — client spending more	Identify what drove the growth; replicate
Green	New Biz	Fresh revenue — new relationship	Ensure smooth onboarding; set up QBR
Amber	Downgrade	Shrinking revenue — client spending less	Investigate immediately; schedule a check-in call
Red	Churn	Lost revenue — client gone	Conduct exit interview; feed into retention strategy

Frequently Asked Questions

Why does the report use "equal-length periods"?

To make a fair comparison. If you compare a 1-month period against a 12-month period, the numbers won't be meaningful. The report always looks back an equal amount of time — so if you pick 3 months, it compares against the previous 3 months.

What revenue is included in the calculation?

The report only counts recurring revenue items — 18 specific products and services that represent ongoing monthly spend (listed in full above). One-off purchases (Setup Invoice, Email Append, Revalidate and Recontact, etc.) and the Toolset Subscription are excluded so the numbers reflect true prospecting recurring revenue.

Why do some values show as negative?

Downgrade and Churn values are shown as negative numbers (with a minus sign) because they represent revenue that was lost. This makes it immediately clear which categories are subtracting from your total. The absolute (positive) value is used when calculating percentages.

What does "BASE" mean?

BASE is simply the total revenue from all your clients in the earlier comparison period — 295 clients worth £842.27k in the screenshot example. It's called "base" because everything else is calculated relative to it — it's the foundation the other numbers are built on.

How often should I check this report?

Monthly is recommended. The report defaults to the current month, making it easy to do a quick monthly health check. For quarterly business reviews, use the "Last 12 Months" preset to see annual trends.

Can I filter by a specific client?

Yes — use the client dropdown at the top of the MRR page to filter all data (including the Renewal Rate tab) to a single client. This lets you see one client's revenue history in isolation.

What's the difference between Gross Churn and Customer Churn?

Gross Churn measures revenue lost — what percentage of your pounds walked out the door.

Customer Churn measures clients lost — what percentage of your accounts left.

If Customer Churn is higher than Gross Churn (as in the screenshot: 17% vs 12%), it means smaller accounts are leaving. If Gross Churn is higher, it means larger accounts are leaving — a more dangerous situation.

Why is NRR different from Renewal Rate?

Renewal Rate only looks at what you kept vs what you lost to churn. It ignores upgrades, downgrades, and new business.

NRR looks at the full picture — it factors in upgrades and downgrades too, measuring whether your existing customer base is generating more or less revenue overall.

Think of Renewal Rate as "how much didn't leave" and NRR as "how much did the relationship grow or shrink."

What does the "Type" dropdown (Revenue vs MRR) do?

At the top of the MRR page, there is a Type selector with two options:

Revenue — shows totals in the original invoice currency
MRR — shows totals adjusted for the month-by-month breakdown (this is what the Renewal Rate tab uses)

The Renewal Rate tab always uses the MRR type internally, regardless of which option is selected on the main page.

Quick Reference Card

📋 At a Glance

Want growth? Look for Renewal Rate > 90%, NRR > 100%, and low Churn.

Losing money? Check the Churn and Downgrade categories — these are where revenue is leaking. Sort the client grid by Delta (ascending) to find the biggest losses.

Client leaving? The client detail grid at the bottom shows you exactly who churned, how much they were paying, and the total revenue impact.

New opportunities? The New Biz and Upgrade categories show where fresh revenue is coming from. Upgrades mean you're doing something right with existing clients — find out what and repeat it.

Healthy portfolio? If your Renewal Rate is above 85% and your NRR is above 95%, you're in good shape. If either drops below those thresholds, investigate immediately.

All formulas at a glance: See the "Summary Formula Cheat Sheet" table above.