Is Each SaaS Customer Worth What You Pay?
In SaaS the first month almost never pays back what it cost to win the customer. The lifetime does. See your lifetime value, LTV to CAC ratio and how fast each customer pays you back.
Lifetime Value, LTV:CAC and Payback
Drag the sliders to match your business. Customer acquisition cost (CAC) is everything you spend on sales and marketing in a period divided by the new customers you won in it.
Estimates only, based on the numbers you enter. Real results depend on your market, your offer and how the campaigns are run.
How the Math Works
- Lifetime value
- monthly revenue per customer × gross margin × lifetime in months
- LTV:CAC ratio
- lifetime value ÷ cost to acquire a customer
- CAC payback
- cost to acquire ÷ (monthly revenue × gross margin)
A common SaaS rule of thumb is 3:1 LTV:CAC or better with payback under about 12 months. Treat it as a starting point, not a law.
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Want These Numbers Run on Your Actual Account?
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