Logo Retention
Logo retention is the percentage of customers (logos) retained from a starting cohort over a defined period, typically annually. It's calculated as customers still active at end of period divided by customers at start, expressed as a percentage. The metric is distinct from net revenue retention (which measures revenue dynamics including expansion and contraction) and gross revenue retention (which measures revenue from the cohort excluding expansion), providing a customer-count view that complements the revenue view. It answers "how many of our customers stayed?" as opposed to "how much of our revenue stayed?"
The calculation:
Basic formula:
- Logo Retention = (Customers at end of period from start cohort) / (Customers at start of period)
- Logo Churn = 1 - Logo Retention.
Cohort-based vs trailing-period:
- Cohort: track a specific group of customers (e.g., all customers as of Jan 1) and see how many remain at end of period.
- Trailing period: total active customers vs total at start of period. Includes new acquisitions in starting count which can distort.
Why three retention metrics matter:
Logo Retention: how many customers stayed. Customer-count view.
Gross Revenue Retention (GRR): revenue retained from cohort, excluding expansion. Pure retention without offsetting growth.
Net Revenue Retention (NRR): revenue retained from cohort including expansion. Best view of customer-base growth.
The interaction:
Strong NRR + weak logo retention: a few big customers expanding while many small customers churning. Possible warning sign of segment problems.
Strong logo retention + weak NRR: many customers stay but at reduced revenue. Indicates contraction or pricing issues.
Strong both: best case. Customers stay and grow.
Benchmarks:
- B2B SaaS logo retention: 80-90%+ considered healthy for SMB; 90%+ for mid-market; 95%+ for enterprise.
- B2B GRR: 85%+ healthy; 90%+ strong.
- B2B NRR: 100%+ healthy; 110%+ strong; 120%+ best-in-class.
Consumer subscription retention rates vary significantly by category; comparisons less standardized.
Ryan's Take
Logo retention is the headcount view that keeps your revenue-retention numbers honest. Strong NRR with weak logo retention means you're concentrating into a few growing accounts, which is risk. Strong logo retention with weak NRR means you're keeping customers but losing revenue per customer, which is a pricing or contraction problem. Strong on both means you're scaling cleanly. Track all three (logo retention, gross revenue retention, net revenue retention), because each tells a different part of the story.
What founders get wrong: Reporting only NRR while ignoring logo retention, masking the customer-count dynamics that often signal segment-specific problems. The right discipline: track logo retention, GRR, and NRR together; investigate divergences.
Related: Net Revenue Retention · Churn Rate · Retention · Expansion Revenue · Contraction Revenue
FAQ
What is logo retention?
The percentage of customers (logos) retained from a starting cohort over a defined period. Calculated as customers still active at end of period divided by customers at start, expressed as a percentage. Distinct from revenue retention metrics.
How is logo retention different from NRR?
Logo retention measures customer-count retention (how many customers stayed). NRR measures revenue dynamics (including expansion and contraction). Both metrics together reveal customer-base health; one alone can mask important dynamics.
What's a good logo retention rate?
For B2B SaaS: 80-90%+ healthy for SMB, 90%+ mid-market, 95%+ enterprise. Higher retention generally signals better product-market fit and customer success execution. Compare to industry benchmarks for your category.
Find this article helpful?
This is just a small sample! Register to unlock our in-depth courses, hundreds of video courses, and a library of playbooks and articles to grow your startup fast. Let us Let us show you!
Submission confirms agreement to our Terms of Service and Privacy Policy.