Substribe creates better performance conditions for premium b2b information brands. Performance in revenues, value for customers, and across teams.
Read on for high level case studies, and a deep dive into a result for a PE backed business.
“Substribe help us align on where we are working and why, focusing our activity to go after that work. This sharper focus continues to bear fruit and includes reimagining our approach to product, and continually enhancing value for our members. Improving the criticality of our solution for our clients.”
Managing director, wilmington plc
Contact andy@substribe.co to discuss your subscription priority.
Here’s a list of high level case studies…
Strategy
IWSR validating the business case for investment in resources to sustain best in class performance
The FT Specialist prioritising investment decisions to continue subscription growth in specialist global markets
Mercia part of Wilmington Plc informing enhancements to product and customer experience to sustain a market leading position
Adjacent market
CRU decoding the value of an existing subscription product and testing in an adjacent market
Monetising subscriptions
Utility Week corporate membership part of Faversham House supported the shift from individual to corporate membership with value proposition, positioning and pricing, unlocking higher price points to support a faster and sustainable journey to >£1m ARR
NutraIngredients part of William Reed used customer perspectives to inform content and commercial strategy for corporate workflows
NDA a specialist title using heavy discounting to compete for market share. Shifting the proposition to a differentiated, digital first, proposition supported by cross functional teams and spearheaded by the editor. The impact is deeper reach into the audience segments, supporting renewable incomes (events and marketing services) and list price digital subscriptions – improving revenues by >£1m)
Memberships
PEI Media Tasked with proving how to “memberfy” communities in the portfolio, tested with 2 high value roles. PEI now have >10 high value member communities, amplifying the success of the subscription and events
Credit Strategy part of Shard Financial Media Group supporting the journey to premium corporate membership and a high value network
Phacilitate part of Clarion Events leveraging the power of community to create year round value for a well regarded event business
Investments
Risk Leadership Network tested appetite for a membership network similar to Procurement Leaders and a potential challenge to Gartner in under served markets. Since investment in 2020 the network has grown into a high value, differentiated solution for Chief Risk Officers.
Reboot
The FT facilitated a strategic reset after lockdown, involving members of the board and senior leadership team across divisions, to inform the evolution of The FT across FT Pro, Specialist, Events and other divisions.
More about the Substribe approach
Sponsor: Most projects are sponsored at Executive level (C-suite / Corporate Development)
Project owner: Successful projects have a leader who helps align the project team (e.g. MD / CMO / COO)
Project team leads: Cross functional teams share ideas and shape the project scope to be tested in market (e.g. Commercial, Customer Success, Marketing, Content)
Case Study – NDA
The £20-30M business intelligence company where high growth was hiding a crisis
Executive Summary
The Impact: 15% improvement in revenue stability (GRR: 71% → 91%) whilst maintaining sustainable growth, framing the narrative to enable a strategic acquisition within 24 months
The Story: A PE-backed data intelligence company following a 130% net revenue retention growth rate. Until Substribe highlighted they were heading for revenue collapse. How independent analysis provided the credibility to change course before it was too late.
The Problem Hidden in Plain Sight
A commercial director was under intense pressure and showed up at a Substribe meeting with an unusual complaint.
The PE owners were obsessing over their 130% Net Revenue Retention (NRR) – a metric showing how much revenue grows within existing customer accounts year-over-year. Anything above 100% means growth; 120%+ is considered excellent.
Better NRR = Better Multiples.
But the commercial director didn’t just feel something was wrong. They knew it. Only no one could stop the NRR juggernaut.
Understanding Recurring Revenue Quality
Before diving into the diagnosis, it’s useful to explain what “recurring revenue quality” means and why it’s transformative for subscription businesses.
Revenue Quality vs Revenue Quantity: Most businesses focus on growing revenue numbers – more customers, higher prices, bigger deals, bigly ARR.
But subscription businesses have a different opportunity: they can engineer the quality of their revenue streams to create predictable, sustainable, and ultimately more valuable businesses.
What High Quality Recurring Revenue Looks Like:
- Predictable: You can forecast with confidence because customers consistently renew and expand
- Stable: Revenue doesn’t swing wildly based on single large deals
- Defendable: Customers are deeply embedded and switching costs are high
- Expandable: Natural growth pathways exist within existing accounts
- Valuable: Higher quality revenue commands premium valuations from investors and acquirers
The Transformation Potential: Companies optimising for revenue quality rather than just revenue growth typically see:
- 2-3x higher valuation multiples due to predictability and lower risk
- Improved margins as customers stick around for longer and existing accounts drive growth
- More strategic options including partnerships, acquisitions, and market expansion
- Competitive moats through deeper customer relationships
Key Revenue Metrics:
- Net Revenue Retention (NRR): How much your existing customers spend this year vs last year (includes expansion, churn, and downgrades)
- Gross Revenue Retention (GRR): How much revenue you keep before any expansion (pure retention – the foundation)
- ARR Waterfall (ARR) unpacking both GRR and NRR and New Business
- Dimension of time (Longitudinal) studying metrics by segment, strategy, product, team
The relationship between these metrics reveals revenue quality. High NRR with low GRR indicates volatile, unsustainable growth. High NRR with high GRR indicates quality expansion on stable foundations.
Cost of Inaction
The company’s 70-75% GRR meant they were losing up to 30% of their revenue base annually, “burning through their TAM” while their 130% NRR evidenced massive expansion success to the PE owners.
The near 60 point gap between GRR and NRR revealed dangerous volatility – they were essentially replacing lost customers with aggressive upsells to remaining ones.
This wasn’t high quality recurring revenue – it was high risk revenue masquerading as growth. Hidden because ARR was growing too. They were brilliant at driving pricing up and acquiring new business in their growth phase.
The Substribe Diagnosis
Using the Substribe Performance Grid – which plots Protection (GRR) against Growth (NRR) – the company was clearly in the “Pricing Lever” quadrant: high growth built on unstable foundations. This is a transition zone, or should be, and the company had been stuck there for a few years. Before that, they weren’t confident or systematic with price rises, seeing themselves as friends of the industry.
The Four Quadrants:
- Double Down (High Protection + High Growth): Scale what’s working
- Pricing Lever (Low Protection + High Growth): Dangerous volatility
- Increase Market Share (High Protection + Low Growth): Stable base, find expansion
- Critical Reboot (Low Protection + Low Growth): Fix everything
Without intervention, they were heading directly into “Critical Reboot” territory.
The Segment Revelations
Longitudinal analysis across tiers revealed systematic strategic errors:
Tier 1 & 2 (Enterprise/Mid-Market): The expected story – retention issues masked by aggressive expansion. Revenue of £5M and £10M respectively, but GRR of 71% and 77% showing the foundation was cracking.
Tier 3 SMB: Labelled as “set and forget” low-value accounts, this segment actually contained strategically important SMBs that had been miscategorised. They were being neglected despite representing genuine growth opportunities.
Tier 4 Non core: These accounts needed a market expansion strategy, but sales teams were applying blanket price increases that were systematically killing the expansion potential. The very strategy meant to drive growth was destroying it, to keep the commissions rolling in.
The External Credibility Factor
Here’s why independent analysis mattered: the commercial director’s concerns about sustainable growth had been dismissed. PE pressure for high NRR meant challenging the growth narrative was career-limiting.
But external data analysis combining NRR with GRR, over time, changed everything instantly. When Substribe presented the 58-point gap and quadrant positioning, it gave leadership permission to question their NRR as hero metric, and expose it as a growth-at-all-costs approach.
The same analysis that carried no weight internally before became obvious when presented by an independent expert with subscription insights.
The Strategic Pivot
The revelation triggered immediate strategic changes:
- Customer Success Investment: Resources redirected from aggressive expansion to retention stabilisation for Tier 1 and Tier 2
- Commission Overhaul: incentivising commercial teams across the ARR waterfall, to include GRR goals not just expansion
- Segment Strategy:
- Tier 3 SMBs moved from “set and forget” to active nurturing
- Tier 4 protected from destructive price increases, given market expansion strategy
The Transformation
Before: 129% NRR / 71% GRR = Volatile growth heading for collapse
After: 106% NRR / 91% GRR = Sustainable expansion on stable foundation
A transformation from high risk revenue to acquisition ready quality – going on to celebrate both a strategic exit and commanding high multiples.
From Revenue Quantity to Revenue Quality
The strategic pivot created genuine revenue quality transformation:
Risk Profile: The narrowed gap between NRR and GRR (from 58 points to 15 points) eliminated the volatility that made the business high-risk. Acquirers could see sustainable growth rather than expansion built on a deteriorating foundation.
Operational Efficiency: Resources shifted from constantly replacing churned revenue to nurturing expansion within stable accounts. Customer success investment paid dividends as teams focused on value realisation rather than damage control.
Strategic Optionality: High-quality recurring revenue opened strategic options that weren’t available with volatile growth patterns. Stable, predictable revenue streams are valuable to strategic acquirers looking for integration opportunities and market expansion platforms.
Valuation Premium: Revenue quality improvements directly enhanced enterprise value. Predictable, stable revenue commands higher multiples because it reduces risk and increases strategic value to potential acquirers.
The Strategic Outcome
Within 24 months, the company was successfully acquired by an industry leader. While the acquisition resulted from the company’s own execution of improved strategies, the course correction from volatile growth to sustainable revenue quality was part of the foundation that made it possible.
The intervention provided:
- Risk identification before crisis hit
- External credibility to challenge PE assumptions
- Strategic permission to prioritise sustainability over growth metrics
- Segment insights revealed hidden value and systematic errors
Key Lessons
- Revenue quality matters more than revenue quantity – sustainable growth on stable foundations creates more value than volatile expansion
- High growth can hide critical weaknesses – NRR without GRR context masks underlying revenue quality issues
- The gap between metrics reveals a lot – protection-growth misalignment indicates unsustainable business patterns
- Segment analysis exposes strategic errors that aggregate metrics miss entirely
- External perspective provides credibility that internal analysis often lacks when challenging investor assumptions
- Revenue quality transformation enables strategic optionality – predictable revenue opens acquisition and partnership opportunities
The Revenue Quality Imperative: In subscription businesses, optimising for recurring revenue quality rather than just growth metrics creates:
- Higher valuation multiples due to predictability
- Reduced dependency on new customer acquisition which is getting more expensive
- Enhanced strategic options and competitive positioning
- Operational efficiency through customer success focus to keep customers
- Sustainable competitive advantages through deeper customer relationships
The Substribe methodology focuses on balancing protection and growth to pursue revenue quality. Not vanity metrics.
