Gross dollar retention above 86%. Of the 18 publicly traded companies that disclosed their gross dollar retention at IPO, the lowest figure was 86% which is still very good. Generally speaking, healthy SaaaS has gross dollar retention of 80%+. Obviously, the higher gross dollar retention is, the higher net dollar retention will be.
Some firms prefer gross dollar retention. We do know some growth equity and venture funds that look to gross dollar retention more so than net dollar. Their view is that so long as you’re not losing customers, they can teach you how to upgrade those customers, whereas if gross dollar retention is low, that’s a much harder problem to solve (retaining customers). We happen to care far more about net dollar retention, as it takes time to figure out your ideal customer and NDR reflects that focused customer, whereas GDR doesn’t isolate the ideal customer in the data at nearly as well.
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