Glossary

• Revenue Concentration — The degree to which a SaaS company's revenue depends on a small number of customers. Measured via HHI (Herfindahl-Hirschman Index).
• Logo Retention — The percentage of customer accounts (logos) retained over a period — distinct from dollar-based net retention.
• Annual Plan Churn — Customer churn specifically on annual subscription plans — often hidden because annual contracts mask monthly exit patterns.
• MRR Decline — Month-over-month decrease in Monthly Recurring Revenue, one of the earliest warning signs of a struggling SaaS business.
• Inactive Paid Accounts — Customers who continue paying but have stopped using the product — at high risk of churning at renewal.
• HHI Score — Herfindahl-Hirschman Index, a measure of market/revenue concentration. For SaaS diligence, it quantifies customer concentration risk.
• SaaS Due Diligence — The process of investigating a SaaS company's financial, operational, and technical health before acquisition.
• Net Revenue Retention (NRR) — The percentage of recurring revenue retained from existing customers, including expansion, contraction, and churn.
• Churn Risk Score — A composite metric that estimates the probability of significant customer churn in the next 12 months.