My top two retention metrics are net dollar retention to show customer expansion over time and gross account retention to show on an absolute basis (regardless of spend) which customers are sticking around. Both help you manage different aspects of retention. One on the dollar side and one on the account side. At the end of the day though they are all helpful cuts
100%. I am a CS guy by trade so I am curious to see how finance experts weigh in. I was speaking to a company last week where gross was 70 and net was close to 100, yikes!
We are sponsoring Cure SMA, which provides support to patients and families affected by spinal muscular atrophy and funds and directs research leading the way to a cure for SMA.
Great article.
Thanks for reading glad you got value from it
Thanks CJ, great article. Curious why NRR wins out over GRR?
My top two retention metrics are net dollar retention to show customer expansion over time and gross account retention to show on an absolute basis (regardless of spend) which customers are sticking around. Both help you manage different aspects of retention. One on the dollar side and one on the account side. At the end of the day though they are all helpful cuts
100%. I am a CS guy by trade so I am curious to see how finance experts weigh in. I was speaking to a company last week where gross was 70 and net was close to 100, yikes!
those are some strong signals if they are b2b. for b2c not terrible
B2B :/. It was an interview for a role on their CS team....lots of red flags and this was a big one for me.
Hey CJ
What charity are you sponsoring this month?
We are sponsoring Cure SMA, which provides support to patients and families affected by spinal muscular atrophy and funds and directs research leading the way to a cure for SMA.
Thanks for your support!
Fantastic write up CJ, a lot of value for folks here.
That is a great organization! Love your philanthropy!
Thanks, CJ - very helpful. What is the specific formula for burn multiple?
It’s EBITDA / Net new ARR
What does EBITDA tell you about cash burn though? I figured it would be (total opex + COGS) / NNARR
EBITDA is a proxy for cash burn in this situation, but I get what you mean, it's not true cash burn because it's still related to gaap revenue