Expansion Velocity
How quickly new customers expand — fast up-tiering is product-market fit you can see in weeks.
What is it?
Expansion Velocity is the share of new customers who go on to expand within a short window — typically sixty days of signing up. It measures not just whether customers expand, but how quickly, which is often the sharper signal.
Fast expansion is strong evidence of product-market fit within your existing motion. When a meaningful share of new customers are already paying you more within two months, your product is creating reasons to grow almost immediately.
How to calculate?
Divide the number of new-MRR events followed by an expansion event within the window by the total number of new-MRR events. Keep the window fixed — sixty days is common — so cohorts stay comparable.
Read it beside contraction velocity: the two together tell you whether new customers tend to grow or shrink in their critical first weeks.