Also known as: upsell revenue, expansion MRR

Expansion Revenue

ConceptualMetricsSalesFinance

Definition

Expansion Revenue: Expansion revenue is additional revenue from existing customers through upsells, cross-sells, or increased usage. Strong expansion revenue can offset churn and drive growth without acquiring new customers. It's measured as expansion MRR or ARR.

Example Usage

“Expansion revenue from seat additions and plan upgrades now equals 30% of our new customer revenue.”

Common Misconceptions

Expansion only comes from upsells. Usage-based pricing drives natural expansion.

Focus on new customers first. Expansion from existing customers is often more efficient.

Expansion revenue is bonus revenue. It's a core component of sustainable SaaS growth.

Related Terms

Net Revenue Retention

Net Revenue Retention measures the percentage of recurring revenue retained from existing customers over a period, including expansions, contractions,...

ConceptualMetrics

Upselling

Upselling is selling a higher-tier or more feature-rich version of a product to existing customers. Unlike cross-selling which offers different produc...

FoundationalSalesStrategies

Customer Success

Customer Success is a business function focused on ensuring customers achieve their desired outcomes while using a product. CS teams proactively help...

ConceptualOperationsSales

Related Tools

ChartMogul

Subscription analytics and revenue reporting platform.

Baremetrics

Subscription analytics, dunning, and forecasting for SaaS.

Stripe

Financial infrastructure to grow your revenue.

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Expansion Revenue

Definition

Example Usage

Common Misconceptions

Related Terms

Net Revenue Retention

Upselling

Customer Success

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