Retention is the dimension most $5M–$50M technology CEOs believe is their strength. In many cases, they are correct — the product retains. Customers stay. Logos are healthy. The back end of the revenue system works as designed.
The question these benchmarks answer is whether ‘customers staying’ is the same thing as ‘the installed base generating its full revenue potential.’ In most companies assessed, these are not the same thing. The retention metrics look healthy. The expansion metrics reveal a missing revenue engine — a dormant installed base that renews reliably but does not grow commercially.
1. Net Revenue Retention: 108%
Median: 108% | Top quartile: 118% | Bottom quartile: 94%
Below 100%: the installed base is shrinking in revenue terms even if logos stay. Contraction and churn exceed expansion. 100–105%: expansion barely outpaces contraction — accidental and unstructured. 105–115%: expansion exists but is ad hoc. Above 115%: expansion is a structured revenue engine with its own pipeline, triggers, and commercial accountability.
The gap between 108% and 118% at $15M ARR: $1.5M annually. Revenue with no acquisition cost, no new sales cycle, no competitive displacement risk. From customers already won and already satisfied. The revenue potential exists in the installed base. The question is whether the architecture to capture it exists alongside it.
Self-test
If NRR is between 100–108% and logo retention exceeds 85%, the diagnosis is clear: the product retains but the commercial motion does not expand. The constraint is not churn. It is the absence of a structured expansion architecture — usage-based triggers, expansion playbooks, commercial CSM targets, and QBR-to-expansion conversion methodology.
2. Logo Retention: 88%
Median: 88% | Top quartile: 94% | Enterprise (>$40K ACV): 95%+ | Mid-market (<$25K): 82% The blended number hides segment divergence. Enterprise retention at 96% and mid-market at 78% produce an 88% blended metric that masks a segment-specific structural weakness. The enterprise strength inflates the number. The mid-market weakness erodes the base. And the aggregate presents a picture that accurately describes neither segment.
This matters operationally: mid-market churn at 18–22% annual revenue churn consumes CS resources disproportionately (high-volume, lower-ACV accounts requiring retention effort) and diverts attention from the enterprise accounts where expansion opportunity is greatest. The blended metric hides this resource allocation problem.
Self-test
Segment logo retention by ACV band: <$25K, $25K–$50K, >$50K. If the gap between highest and lowest segment exceeds 15 percentage points, the retention architecture is bifurcated. Each segment needs different intervention. The blended number conceals this.
3. Expansion Revenue: 14% of Opening ACV
Median: 14% | Top quartile: 28% | Bottom quartile: 5%
Below 10%: no expansion motion exists. Revenue growth depends entirely on new logo acquisition at full cost. Between 10–20%: expansion happens ad hoc — individual CSMs surface opportunities reactively. Above 25%: a structured expansion programme with dedicated pipeline, commercial triggers, and measured conversion rates.
The unit economics tell the full story: every new logo dollar costs $1.00 in acquisition (marketing, SDR, AE time, sales engineering). Every expansion dollar costs $0.15–$0.25 (CSM time, minimal marketing, no competitive displacement). The installed base is the most capital-efficient revenue source in the business. At $15M ARR, the gap between 14% and 28% expansion rate represents roughly $2.1M in annual revenue that requires 4–7x less investment to capture than the equivalent from new logos. The revenue is available. The architecture to capture it is not.
Self-test
What percentage of total revenue growth last 12 months came from existing customers versus new logos? If below 20% from existing, the most efficient revenue engine in the business is structurally dormant.
4. Time-to-First-Expansion: 11 Months
Median: 11 months post-close | Top quartile: 7 months
If expansion typically occurs only at the renewal conversation, the motion is passive — waiting for the annual commercial touchpoint to surface opportunities that usage data revealed months earlier. Structured expansion programmes target 6–9 month milestones: usage thresholds indicating capacity growth, team expansion signals indicating broadening need, and feature adoption patterns revealing adjacent use cases.
The 4-month gap between median and top quartile represents a full expansion cycle that top-performing companies capture before the renewal conversation begins — and before competitors have the opportunity to intervene at renewal with a displacement pitch.
Self-test
When does the first structured expansion conversation happen with a new customer? If the answer is ‘at renewal,’ the expansion motion is reactive. Top quartile companies initiate formal expansion qualification at 6 months post-close using usage data and adoption milestones.
5. Commercial CSM Impact: 2.3x Expansion Revenue
Companies with commercial CSM motions: 2.3x expansion revenue per customer
The difference versus purely support-oriented CS is not talent. It is architecture. Commercial CS means: expansion pipeline targets alongside retention targets, compensation tied to NRR contribution, usage-based triggers feeding structured commercial conversations, and QBRs that include an expansion diagnostic alongside the relationship review.
Support-oriented CS measures: renewal rate, health score, NPS, ticket resolution. These are important. They do not produce expansion revenue. A team measured exclusively on retention will produce retention. A team measured on retention plus expansion pipeline will produce both — because the incentive architecture and the process architecture align to make expansion a deliberate commercial motion rather than an accidental outcome of satisfied customers occasionally asking for more.
Self-test
What are your CSMs measured on? If the answer is retention metrics only, expansion revenue is structurally limited to whatever happens organically. Adding expansion pipeline targets alongside retention targets is the single highest-leverage architectural change in the CS function.
Lead-to-Order Structural Assessment
These benchmarks tell you where you stand on retention and expansion. The Lead-to-Order Structural Assessment scores Retention and Expansion as one of six dimensions — including cohort-level churn decomposition, NRR trajectory modelling, expansion pipeline analysis, and time-to-expansion benchmarking.
The sample company scored 4 out of 5 — strong retention masking weak expansion. See what 4/5 looks like, what it costs in unrealised expansion revenue, and what the path from 4 to 5 requires.
Before You Commit Capital, Credibility, or Momentum
Technology CEOs are increasingly using decision-grade GTM due diligence before high-stakes commercial bets — not to outsource judgement, but to ensure the decision stands up before it's made.
When a GTM decision is hard to unwind — a senior hire, a pricing change, a market entry — the cost of being wrong compounds quietly. Two quarters slip away before you know it failed.
Commercial Bet Due Diligence (CBDD) is a short, independent review used before commitment. It evaluates a single GTM bet across product, pricing, positioning, sales, and customer growth — and concludes with a clear verdict:
- Review a sample CBDD board memo — the artefact CEOs and boards use to govern these decisions
- Learn how the CBDD process works — and when it's applied
