The Forecasting Risk Lurking Beneath the Base Business

As a CFO, you're tasked with doing what most SaaS leaders are struggling to achieve in 2025: Deliver growth. Improve efficiency. Preserve margin.

Your forecast assumes base revenue will hold, or expand. But in too many cases, it doesn’t. And the reasons why are often misdiagnosed.

Most finance leaders monitor NRR, churn, expansion rates, and GRR. But those are trailing indicators. What’s often missing is a forward-looking view of how the customer base is behaving today, and what that behavior tells you about tomorrow’s revenue.

Our recent joint research with QuadSci analyzed over 9,100 SaaS accounts and 160 billion telemetry data points. It surfaced a signal that explains the growing volatility in base revenue:

Customer usage behavior—not CSAT, not pricing—is the single strongest predictor of NRR outcomes.

And more importantly, it’s measurable.

Why Base Revenue Has Become Less Predictable

Net Revenue Retention across SaaS has declined from 110% to 107% since early 2023. Nearly 6 in 10 companies are seeing weaker renewal and expansion performance than two years ago.

That drop isn't a blip. It’s a trend. And it’s one that’s largely invisible in standard forecast models.

Finance leaders often build retention assumptions based on historical averages, sales pipelines, or lagging health metrics. But those inputs don’t explain why certain accounts expand… while others churn.

Usage consistency does.

When customers use your product frequently and predictably, they renew. When usage becomes sporadic, growth stalls. This pattern explains over 80% of base revenue outcomes across the data set.

But most finance and RevOps dashboards track usage only by volume. That’s not enough. Because usage levels spike and dip—making the signal hard to trust.

The Metric That Clarifies Risk

The breakthrough comes when you look at two dimensions together:

• Usage Level — how much customers are using your product
• Usage Consistency — how reliably they use it over time

This combination cuts through the noise and surfaces clear behavioral patterns. Six usage-based cohorts emerge—each with distinct financial implications.

Instead of treating all customers equally, you gain visibility into:

• Who will likely renew or expand
• Who is stalling out
• Who is quietly slipping into churn

How It Changes the Finance Lens

Finance leaders applying this model can shift their role from cost controller to growth engineer:

• Forecasts stabilize. When cohort behavior is tracked and understood, retention becomes less of a guess and more of a leading indicator.
• Investment becomes precise. CS resources, enablement dollars, and retention efforts are redirected toward accounts most likely to yield a return.
• Margin improves. Companies using this model are seeing an average 5-point lift in NRR. This is the equivalent of adding a quarter’s worth of pipeline without new acquisition cost.

For CFOs in private equity-backed SaaS firms or public companies, this isn’t just operational upside. It’s valuation leverage.

Where High-Performing CFOs Are Focusing Next

The best CFOs aren’t just approving commercial budgets, they’re shaping how those dollars get deployed. They’re pushing RevOps, Product, and Success teams to answer:

• Which cohort is growing?
• Which customers are slipping into risk zones?
• What’s our true base revenue trajectory 90 days from now?

They're embedding usage-consistency signals into:

• Board-facing forecast models
• Base growth assumptions
• Strategic planning sessions
• Coverage and comp model design

And they’re asking a new set of questions:

• How do we scale ARR without growing burn?
• Where are we over-allocating effort with low-yield customers?
• Can we expand NRR without new headcount or CAC spend?

From Financial Reporting to Commercial Precision

The CFO’s role has evolved. Growth is no longer just a go-to-market problem. It’s a financial imperative.

And in 2025, base business volatility is one of the biggest threats to forecast accuracy, margin integrity, and investor confidence.

But it’s also one of the biggest levers if you can measure the signal that predicts it.

Usage consistency gives CFOs a quantifiable, forward-looking view of the base business that ties directly to renewal, expansion, and margin contribution.

It turns the customer base from a source of risk into a source of resilience.

Explore this further in SBI’s research report: Engineering SaaS Account Growth: From Guesswork to Predictable Growth.