Net Dollar Retention (NDR)
Another name for net revenue retention — the percentage of revenue retained from existing customers including expansion, contraction, and churn. Used interchangeably with NRR in most SaaS contexts.
NDR and NRR Are the Same Thing
Let us not overcomplicate this. Net dollar retention and net revenue retention measure the same thing — how much revenue from existing customers you keep and grow over a period. Some companies prefer NDR, others prefer NRR. Public company filings sometimes use one term, earnings calls use the other. They are identical.
Why NDR Above 100% Changes Everything
An NDR above 100% means your existing customers are worth more today than they were a year ago. That is compound growth baked into your business model. At 120% NDR, even without acquiring a single new customer, your revenue grows 20% per year. Add new customer acquisition on top and you have a compounding machine.
The Calculation
NDR = (Beginning Period Revenue + Expansion - Contraction - Churn) / Beginning Period Revenue x 100
Track it on a trailing 12-month basis for the most accurate picture. Monthly NDR is too volatile. Quarterly is acceptable. Annual is the gold standard.
How Product Design Drives NDR
The highest NDR companies build expansion into their product architecture. Usage-based pricing, seat-based growth, and tiered feature access create natural revenue expansion as customers succeed. If your product does not have a built-in expansion mechanism, your NDR will always be capped by how good your upsell sales team is.
Frequently Asked Questions
Is NDR the same as NRR?
Yes. Net dollar retention and net revenue retention are the same metric. Some companies say NDR, others say NRR. Both measure the percentage of revenue from existing customers you retain over a period, including expansion and contraction. The terminology varies by company, but the calculation is identical.
What NDR do investors look for?
110%+ is the baseline for a fundable B2B SaaS company. 120%+ signals strong expansion mechanics. 130%+ is best-in-class territory. Companies like Twilio, Datadog, and Snowflake have achieved 150%+ NDR. Below 100% means your existing customer base is shrinking.
