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960 Why Net Retention Rates Are All the Rage for AI Investors

The Information
Sri Muppidi @ The Information · 02/05/2025 09:00 EDT

Why Net Retention Rates Are All the Rage for AI Investors

Investors in artificial intelligence startups have been wowed by the growth of many young AI startups, which are hitting revenue milestones years earlier than a previous generation of software companies did. But they are worried many of those startups won’t be able to hang on to this phenomenal growth—and are hunting for clues on which ones will survive.

To do so, they’re zeroing in on a favored metric of enterprise software investors: net revenue retention rates, which measure a company’s ability to keep.

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