Cross-Sell ARR
Growth
Industry:
SaaS
Short Definition
Cross-sell ARR is the increase in annual recurring revenue when an existing customer buys a distinct paid product or module in the period. Count it on the effective (go-live) date, not when it’s signed. (Signed-not-live sits in CARR—Contracted ARR—for a future start.)
Short Definition
Cross-sell ARR is the increase in annual recurring revenue when an existing customer buys a distinct paid product or module in the period. Count it on the effective (go-live) date, not when it’s signed. (Signed-not-live sits in CARR—Contracted ARR—for a future start.)
Short Definition
Cross-sell ARR is the increase in annual recurring revenue when an existing customer buys a distinct paid product or module in the period. Count it on the effective (go-live) date, not when it’s signed. (Signed-not-live sits in CARR—Contracted ARR—for a future start.)
Why it matters for Investors
Base-led growth: Shows how much growth comes from selling distinct products to customers you already have.
Efficiency: Cross-sells often cost less than acquiring new logos.
Product breadth: Rising attach rates signal strong portfolio fit and packaging.
Net Revenue Retention lift: Cross-sell ARR contributes to Expansion ARR and supports Net Revenue Retention.
Why it matters for Investors
Base-led growth: Shows how much growth comes from selling distinct products to customers you already have.
Efficiency: Cross-sells often cost less than acquiring new logos.
Product breadth: Rising attach rates signal strong portfolio fit and packaging.
Net Revenue Retention lift: Cross-sell ARR contributes to Expansion ARR and supports Net Revenue Retention.
Why it matters for Investors
Base-led growth: Shows how much growth comes from selling distinct products to customers you already have.
Efficiency: Cross-sells often cost less than acquiring new logos.
Product breadth: Rising attach rates signal strong portfolio fit and packaging.
Net Revenue Retention lift: Cross-sell ARR contributes to Expansion ARR and supports Net Revenue Retention.
Formula
Practical considerations:
Scope: Existing customers only. Must be a distinct paid product/module (not a higher tier of the same product, and not more of the same units).
Timing: Count when effective (go-live). Signed-for-later stays in CARR until start.
Committed & recurring only: Include contracted, repeating charges; exclude uncommitted overage/one-offs.
Split mixed changes once:
Higher tier of same product → Upsell (not Cross-sell)
More seats/units or price-only ↑ → Add-on (not Cross-sell)
New distinct module/product → Cross-sell
Ramps: Pre-agreed activations of a distinct module count when that module’s step goes live.
Reversals: If undone in the same period, net to $0; if later, the drop is Contraction.
Exclude:
Upsell ARR (move to higher tier/edition)
Add-on ARR (more seats/units, higher minimum, or price-only increase)
One-offs and uncommitted usage (revenue, not ARR)
Formula
Practical considerations:
Scope: Existing customers only. Must be a distinct paid product/module (not a higher tier of the same product, and not more of the same units).
Timing: Count when effective (go-live). Signed-for-later stays in CARR until start.
Committed & recurring only: Include contracted, repeating charges; exclude uncommitted overage/one-offs.
Split mixed changes once:
Higher tier of same product → Upsell (not Cross-sell)
More seats/units or price-only ↑ → Add-on (not Cross-sell)
New distinct module/product → Cross-sell
Ramps: Pre-agreed activations of a distinct module count when that module’s step goes live.
Reversals: If undone in the same period, net to $0; if later, the drop is Contraction.
Exclude:
Upsell ARR (move to higher tier/edition)
Add-on ARR (more seats/units, higher minimum, or price-only increase)
One-offs and uncommitted usage (revenue, not ARR)
Formula
Practical considerations:
Scope: Existing customers only. Must be a distinct paid product/module (not a higher tier of the same product, and not more of the same units).
Timing: Count when effective (go-live). Signed-for-later stays in CARR until start.
Committed & recurring only: Include contracted, repeating charges; exclude uncommitted overage/one-offs.
Split mixed changes once:
Higher tier of same product → Upsell (not Cross-sell)
More seats/units or price-only ↑ → Add-on (not Cross-sell)
New distinct module/product → Cross-sell
Ramps: Pre-agreed activations of a distinct module count when that module’s step goes live.
Reversals: If undone in the same period, net to $0; if later, the drop is Contraction.
Exclude:
Upsell ARR (move to higher tier/edition)
Add-on ARR (more seats/units, higher minimum, or price-only increase)
One-offs and uncommitted usage (revenue, not ARR)
Worked Example
Starting ARR (Feb 28): $1,200,000
Period: March (snapshot Mar 31)
Account | Event | Effective by Mar 31? | Account ARR @ Mar-31 ($) | Δ ARR in March ($) | Category | Notes |
|---|---|---|---|---|---|---|
A | New logo, annual $24,000, starts Mar 4 | Yes | $24,000 | +$24,000 | New Logo | Not Cross-sell |
B | New logo, annual $36,000, starts Apr 1 | No | $0 | $0 | Booking / CARR | Signed, starts next month |
C | Upgrade: Standard $50,000 → Enterprise $68,000 (Mar 15) | Yes | $68,000 ($50,000 → $68,000) | +$18,000 | Expansion — Upsell | Higher tier of same product |
D | Cancellation effective Mar 31 (prior $40,000) | Yes | $0 | −$40,000 | Logo Churn | Account to $0 |
E | Pre-agreed tier step-up (ramp) $20,000 → $35,000 on Mar 1 | Yes | $35,000 | +$15,000 | Expansion — Upsell (ramp) | Counts in Upsell (Expansion) — Higher edition starts this month |
H | Add distinct Analytics module $6,000 on Mar 20 (prior $30,000) | Yes | $36,000 ($30,000 → $36,000) | +$6,000 | Expansion — Cross-sell | New module, distinct product |
J | Add distinct Governance module $9,000 on Mar 5 (prior $20,000) | Yes | $29,000 ($20,000 → $29,000) | +$9,000 | Expansion — Cross-sell | New module, distinct product |
K | Signed Cross-sell $12,000, starts Apr 5 | No | $0 | $0 | Booking / CARR | Signed, not live in March |
Cross-Sell ARR (March): $15,000 = $6,000 (H) + $9,000 (J)
ARR Bridge (March):
New Logo ARR: +$24,000 (A)
Expansion ARR: +$48,000 (Upsell $33,000 from C+E + Cross-sell $15,000 from H+J)
Contraction ARR: $0
Logo Churn ARR: −$40,000 (D)
Net New ARR: $24,000 + $48,000 − $40,000 = $32,000
Ending ARR (Mar 31): $1,200,000 + $32,000 = $1,232,000
Notes:
H and J count as Cross-sell because they added distinct paid modules.
C and E are Upsell (higher tier of the same product), not Cross-sell.
K is signed but not live → stays in CARR.
A is New Logo; D is Logo Churn.
Only committed, recurring amounts count; ignore one-time fees and uncommitted overage.
Worked Example
Starting ARR (Feb 28): $1,200,000
Period: March (snapshot Mar 31)
Account | Event | Effective by Mar 31? | Account ARR @ Mar-31 ($) | Δ ARR in March ($) | Category | Notes |
|---|---|---|---|---|---|---|
A | New logo, annual $24,000, starts Mar 4 | Yes | $24,000 | +$24,000 | New Logo | Not Cross-sell |
B | New logo, annual $36,000, starts Apr 1 | No | $0 | $0 | Booking / CARR | Signed, starts next month |
C | Upgrade: Standard $50,000 → Enterprise $68,000 (Mar 15) | Yes | $68,000 ($50,000 → $68,000) | +$18,000 | Expansion — Upsell | Higher tier of same product |
D | Cancellation effective Mar 31 (prior $40,000) | Yes | $0 | −$40,000 | Logo Churn | Account to $0 |
E | Pre-agreed tier step-up (ramp) $20,000 → $35,000 on Mar 1 | Yes | $35,000 | +$15,000 | Expansion — Upsell (ramp) | Counts in Upsell (Expansion) — Higher edition starts this month |
H | Add distinct Analytics module $6,000 on Mar 20 (prior $30,000) | Yes | $36,000 ($30,000 → $36,000) | +$6,000 | Expansion — Cross-sell | New module, distinct product |
J | Add distinct Governance module $9,000 on Mar 5 (prior $20,000) | Yes | $29,000 ($20,000 → $29,000) | +$9,000 | Expansion — Cross-sell | New module, distinct product |
K | Signed Cross-sell $12,000, starts Apr 5 | No | $0 | $0 | Booking / CARR | Signed, not live in March |
Cross-Sell ARR (March): $15,000 = $6,000 (H) + $9,000 (J)
ARR Bridge (March):
New Logo ARR: +$24,000 (A)
Expansion ARR: +$48,000 (Upsell $33,000 from C+E + Cross-sell $15,000 from H+J)
Contraction ARR: $0
Logo Churn ARR: −$40,000 (D)
Net New ARR: $24,000 + $48,000 − $40,000 = $32,000
Ending ARR (Mar 31): $1,200,000 + $32,000 = $1,232,000
Notes:
H and J count as Cross-sell because they added distinct paid modules.
C and E are Upsell (higher tier of the same product), not Cross-sell.
K is signed but not live → stays in CARR.
A is New Logo; D is Logo Churn.
Only committed, recurring amounts count; ignore one-time fees and uncommitted overage.
Worked Example
Starting ARR (Feb 28): $1,200,000
Period: March (snapshot Mar 31)
Account | Event | Effective by Mar 31? | Account ARR @ Mar-31 ($) | Δ ARR in March ($) | Category | Notes |
|---|---|---|---|---|---|---|
A | New logo, annual $24,000, starts Mar 4 | Yes | $24,000 | +$24,000 | New Logo | Not Cross-sell |
B | New logo, annual $36,000, starts Apr 1 | No | $0 | $0 | Booking / CARR | Signed, starts next month |
C | Upgrade: Standard $50,000 → Enterprise $68,000 (Mar 15) | Yes | $68,000 ($50,000 → $68,000) | +$18,000 | Expansion — Upsell | Higher tier of same product |
D | Cancellation effective Mar 31 (prior $40,000) | Yes | $0 | −$40,000 | Logo Churn | Account to $0 |
E | Pre-agreed tier step-up (ramp) $20,000 → $35,000 on Mar 1 | Yes | $35,000 | +$15,000 | Expansion — Upsell (ramp) | Counts in Upsell (Expansion) — Higher edition starts this month |
H | Add distinct Analytics module $6,000 on Mar 20 (prior $30,000) | Yes | $36,000 ($30,000 → $36,000) | +$6,000 | Expansion — Cross-sell | New module, distinct product |
J | Add distinct Governance module $9,000 on Mar 5 (prior $20,000) | Yes | $29,000 ($20,000 → $29,000) | +$9,000 | Expansion — Cross-sell | New module, distinct product |
K | Signed Cross-sell $12,000, starts Apr 5 | No | $0 | $0 | Booking / CARR | Signed, not live in March |
Cross-Sell ARR (March): $15,000 = $6,000 (H) + $9,000 (J)
ARR Bridge (March):
New Logo ARR: +$24,000 (A)
Expansion ARR: +$48,000 (Upsell $33,000 from C+E + Cross-sell $15,000 from H+J)
Contraction ARR: $0
Logo Churn ARR: −$40,000 (D)
Net New ARR: $24,000 + $48,000 − $40,000 = $32,000
Ending ARR (Mar 31): $1,200,000 + $32,000 = $1,232,000
Notes:
H and J count as Cross-sell because they added distinct paid modules.
C and E are Upsell (higher tier of the same product), not Cross-sell.
K is signed but not live → stays in CARR.
A is New Logo; D is Logo Churn.
Only committed, recurring amounts count; ignore one-time fees and uncommitted overage.
Best Practices
Report it separately: Break out Cross-sell from Upsell and Add-on so the distinct driver is clear.
Track attach rates: Monitor the % of customers using each distinct module; set targets by segment.
Use signals to trigger offers: Build plays off usage gaps, feature requests, or lifecycle moments (e.g., pre-renewal) for the distinct module.
Make activation easy: Simple packaging, clear pricing, in-app prompts, and fast order/enablement for distinct modules.
Check adoption post-go-live: Do 30/60-day reviews to confirm the distinct module is used; intervene early if usage is low.
Forecast cleanly: Keep a pipeline for distinct modules with expected go-live dates; reconcile monthly to your ARR bridge.
Tag wins & learn: Capture reason codes for each distinct module sale; share patterns with Product/Customer Success to refine bundles and messaging.
Best Practices
Report it separately: Break out Cross-sell from Upsell and Add-on so the distinct driver is clear.
Track attach rates: Monitor the % of customers using each distinct module; set targets by segment.
Use signals to trigger offers: Build plays off usage gaps, feature requests, or lifecycle moments (e.g., pre-renewal) for the distinct module.
Make activation easy: Simple packaging, clear pricing, in-app prompts, and fast order/enablement for distinct modules.
Check adoption post-go-live: Do 30/60-day reviews to confirm the distinct module is used; intervene early if usage is low.
Forecast cleanly: Keep a pipeline for distinct modules with expected go-live dates; reconcile monthly to your ARR bridge.
Tag wins & learn: Capture reason codes for each distinct module sale; share patterns with Product/Customer Success to refine bundles and messaging.
Best Practices
Report it separately: Break out Cross-sell from Upsell and Add-on so the distinct driver is clear.
Track attach rates: Monitor the % of customers using each distinct module; set targets by segment.
Use signals to trigger offers: Build plays off usage gaps, feature requests, or lifecycle moments (e.g., pre-renewal) for the distinct module.
Make activation easy: Simple packaging, clear pricing, in-app prompts, and fast order/enablement for distinct modules.
Check adoption post-go-live: Do 30/60-day reviews to confirm the distinct module is used; intervene early if usage is low.
Forecast cleanly: Keep a pipeline for distinct modules with expected go-live dates; reconcile monthly to your ARR bridge.
Tag wins & learn: Capture reason codes for each distinct module sale; share patterns with Product/Customer Success to refine bundles and messaging.
FAQs
What counts as Cross-sell ARR?
ARR from a distinct paid product or module bought by an existing customer; recorded when the module goes live.Cross-sell vs Upsell vs Add-on—what’s the difference?
Cross-sell: a distinct product/module. Upsell: higher tier/plan of the same product. Add-on: more seats/units or a price-only increase on the same product/tier.Do price-only increases or more seats qualify as Cross-sell?
No—those are Add-on, not Cross-sell (they’re not distinct products).When do we record Cross-sell ARR?
On the effective (go-live) date of the distinct module. Signed-not-live sits in CARR (Contracted ARR for a future start).How do ramps work for Cross-sell?
If a distinct module is scheduled to activate later, count it when that module actually goes live (the step date).Can Cross-sell ARR be negative?
No. If the distinct module is removed later, that shows up as Contraction (Down-sell/Reduction), not negative Cross-sell.Where does Cross-sell show in the ARR bridge?
Under Expansion ARR (it’s expansion from a distinct product).
FAQs
What counts as Cross-sell ARR?
ARR from a distinct paid product or module bought by an existing customer; recorded when the module goes live.Cross-sell vs Upsell vs Add-on—what’s the difference?
Cross-sell: a distinct product/module. Upsell: higher tier/plan of the same product. Add-on: more seats/units or a price-only increase on the same product/tier.Do price-only increases or more seats qualify as Cross-sell?
No—those are Add-on, not Cross-sell (they’re not distinct products).When do we record Cross-sell ARR?
On the effective (go-live) date of the distinct module. Signed-not-live sits in CARR (Contracted ARR for a future start).How do ramps work for Cross-sell?
If a distinct module is scheduled to activate later, count it when that module actually goes live (the step date).Can Cross-sell ARR be negative?
No. If the distinct module is removed later, that shows up as Contraction (Down-sell/Reduction), not negative Cross-sell.Where does Cross-sell show in the ARR bridge?
Under Expansion ARR (it’s expansion from a distinct product).
FAQs
What counts as Cross-sell ARR?
ARR from a distinct paid product or module bought by an existing customer; recorded when the module goes live.Cross-sell vs Upsell vs Add-on—what’s the difference?
Cross-sell: a distinct product/module. Upsell: higher tier/plan of the same product. Add-on: more seats/units or a price-only increase on the same product/tier.Do price-only increases or more seats qualify as Cross-sell?
No—those are Add-on, not Cross-sell (they’re not distinct products).When do we record Cross-sell ARR?
On the effective (go-live) date of the distinct module. Signed-not-live sits in CARR (Contracted ARR for a future start).How do ramps work for Cross-sell?
If a distinct module is scheduled to activate later, count it when that module actually goes live (the step date).Can Cross-sell ARR be negative?
No. If the distinct module is removed later, that shows up as Contraction (Down-sell/Reduction), not negative Cross-sell.Where does Cross-sell show in the ARR bridge?
Under Expansion ARR (it’s expansion from a distinct product).
Related Metrics
Commonly mistaken for:
Upsell ARR (ARR from tier upgrades, not new products)
Add-on ARR (ARR from optional features, not distinct products)
New Logo ARR (ARR from new customers, not existing ones)
Related Metrics
Commonly mistaken for:
Upsell ARR (ARR from tier upgrades, not new products)
Add-on ARR (ARR from optional features, not distinct products)
New Logo ARR (ARR from new customers, not existing ones)
Related Metrics
Commonly mistaken for:
Upsell ARR (ARR from tier upgrades, not new products)
Add-on ARR (ARR from optional features, not distinct products)
New Logo ARR (ARR from new customers, not existing ones)
Source of:
Index