$ based net retention rate for our companies

Investment Analysis Clubs Saul’s Investing Discussions
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A current article on Seeking Alpha is about Crowdstrike, is positive, and doesn’t say much that we don’t already know, but it has a VERY interesting graph.

https://seekingalpha.com/article/4337234-crowdstrike-one-of-…

It graphs the Dollar-Based Net Retention Rates for 30 SaaS stocks, the vast majority of which we have discussed at one time or another.

Of the top three Net Retention Rates, all three are in my top four positions, led by Datadog at 151%, Crowdstrike at 147% and Zoom at 140%.

If we look at the top five Net Retention Rates, it picks up Alteryx in 5th place at 132%, and gets all four of my top four positions, which make up over 80% of my portfolio!

Okta, my 5th position is a bit lower at 12th out of the 30 companies, still not bad at 121%. That’s about 95% of my portfolio.

Ring, on the other hand, much discussed on the board as a possible threat to Zoom, is next to last at 99%. Other companies on the graph include SMAR, NOW, MDB, VEEV, COUP, ESTC, SHOP, PLAN, DOCU, LVGO, BILL, WORK, HUBS, WDAY, SQ, TWLO, etc etc

Saul

A link to the Knowledgebase for this board is in the Announcements panel that is on the right side of every page on this board.

For some additions to the Knowledgebase, bringing it up to date, I’d advise reading several other posts linked to on the panel, especially “How I Pick a Company to Invest In,” and “Why My Investing Criteria Have Changed,” and “Why It Really is Different.”

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Thanks Saul! Love to see things like this.

Sorry for the layman’s question, but this article left me confused about something. Could anyone help me understand the difference between gross retention rate and net retention rate?

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Could anyone help me understand the difference between gross retention rate and net retention rate?

As I understand the way they are using those terms,

Gross retention rate is the number of customers that are still there a year later (max score is 100%)

Net retention rate is the amount of total dollars being spent by the cohort of last year’s customers this year, compared to what they spent last year. (this is the one that counts).

For example Datadog’s 151% net retention rate means that last years cohort of customers (even allowing for a few that dropped out) are spending a total of $151 for every $100 that they spent last year.

Saul

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A year from now net retention will be meaningless as SAAS will have a fraction of the subscribers it had last quarter. We’re not going back to life as it once was. The new normal is yet to be defined.

You are focusing on tools that are fading into obsolescence in a COVID world. Pat yourself on the back if that feels good, but don’t get too used to that feeling.

🆁🅶🅱
For not in my bow do I trust, nor can my sword save me.

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.” We’re not going back to life as it once was. The new normal is yet to be defined.”

Bad day Nostradamus?

TMB

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It must be awesome to have such certainty about the future.

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Quite frankly…I am not sure why this board gives validation to certain board participants that post with the singular purpose of being contrarian for the sake of contrarianism in an effort to troll and disrupt what is otherwise a mature, thoughtful and productive message board. If you search certain unnamed individuals and read their message board post history, you will find that the vast majority of those posts are unproductive at the least and inflammatory at the most.

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