Dollar-Based Net Expansion Rate

What is Dollar-Based Net Expansion Rate?

Dollar-based net expansion rate (DBNER) measures revenue growth from existing customers over a specific period, accounting for upgrades, downgrades, and churn.

Example of Dollar-Based Net Expansion Rate

A company with $1 million in revenue from existing customers in the previous year and $1.2 million in the current year has a DBNER of 120%.

How To Calculate Dollar-Based Net Expansion Rate

(DBNER = (Current Period Revenue – Previous Period Revenue) / Previous Period Revenue) x 100 

  • Special Tip: Focus on customer retention and upselling to improve your DBNER and overall revenue growth.
  • Advantages 
    • Provides insight into customer retention and revenue growth. 
    • Helps identify opportunities for upselling and cross-selling. 
  • Disadvantages 
    • Can be affected by significant churn or downgrades. 
    • Requires accurate revenue tracking.


Why is DBNER important?

It shows how effectively a company is growing revenue from its existing customer base.

A DBNER above 100% indicates positive revenue growth from existing customers.

Focus on customer satisfaction, upselling, and minimizing churn.

It is particularly useful for subscription-based and SaaS companies.


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