CAC / LTV / LTV:CAC Calculator
The three numbers every SaaS board asks for. Calculate CAC properly (fully loaded, beyond paid media), LTV adjusted for gross margin, and the ratio that tells you whether the business is sustainable.
SaaS Metrics Intelligence
Marketing teams usually report CAC that excludes half of the real cost: and LTV that ignores gross margin.
A defensible CAC includes paid media plus the fully-loaded cost of the sales + marketing team working on acquisition. A defensible LTV multiplies ARPU by gross margin by average customer lifetime. This calculator uses the standard SaaStr + Bessemer formula and compares the result to published public SaaS benchmarks.
Customer acquisition cost (CAC)
Paid media spend (period)
All platforms, net of agency fees
Fully-loaded sales + marketing cost
Salaries, benefits, tools, overhead: same period
New customers acquired
Period
Customer lifetime value (LTV)
Average revenue per account (ARPA)
Monthly recurring revenue per customer
Gross margin %
After hosting, support, 3rd-party. Typical B2B SaaS: 70–85%.
Monthly net revenue churn %
Lost ARR net of expansion, divided by starting ARR
Benchmarks
LTV:CAC 3:1Healthy
LTV:CAC 1:1 to 3:1Marginal
LTV:CAC < 1Burning capital
CAC payback 12 monthsGreat
CAC payback 24 monthsAcceptable
CAC payback 36+ monthsAlarm
Results
CAC
–
per new customer
LTV
–
margin-adjusted
LTV:CAC
–
–
CAC Payback
–
months to recoup CAC
Verdict
Calculation detail
Export
Frequently asked questions
What is CAC?
Customer Acquisition Cost. Fully-loaded sales + marketing cost over a period, divided by new customers acquired in that period.
What is a "fully-loaded" CAC?
Includes paid media, S&M salaries, agency fees, software costs, overhead attributable to acquisition. More than ad spend.
What is LTV?
Customer Lifetime Value. The gross-margin-adjusted revenue a customer generates over their expected lifetime with you.
Why multiply LTV by gross margin?
Because only gross profit is available to repay CAC and generate return. Revenue-based LTV without the margin adjustment overstates the business.
What LTV:CAC ratio is "healthy"?
3:1 is the standard benchmark. 1:1 to 3:1 is marginal. Below 1:1 you lose money on every customer.
What is CAC payback period?
The number of months of gross-margin-adjusted revenue needed to recoup one CAC. 12 months is excellent, 24 is acceptable for enterprise.
Can LTV:CAC be too high?
Yes. A 10:1 ratio usually means you're under-investing in acquisition. The business could grow faster.
How does churn affect LTV?
Directly. Customer lifetime = 1 / monthly churn rate. 2% monthly churn means 50-month average lifetime. 5% churn drops it to 20 months.
What LTV should I use for a new product with no churn data?
A cohort-based estimate using early retention from similar products in the same category. Don't extrapolate from 2 months of data; the number will be wildly off.
Does LTV include expansion revenue?
If you have expansion (upsells, more seats), yes. The gross-margin-adjusted expansion contribution should be in LTV. For SMB with no expansion, skip it.
What is a "payback period" venture investors look for?
Under 18 months at Series A, under 24 months at Series B+. Longer at enterprise where contract values and NRR change the math.
How often should I recalculate CAC and LTV?
Quarterly. Monthly if growth or churn are moving fast. Trends matter more than any single quarter.
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