CAC & LTV Calculator
Acquiring customers is only smart if they're worth more than they cost. Enter a few numbers to see your customer acquisition cost, lifetime value, the all-important LTV:CAC ratio, and how fast you earn the money back.
How to read it
LTV here is lifetime gross profit: monthly revenue × gross margin × lifetime. CAC is spend ÷ new customers. The ratio tells you how many dollars of profit each acquisition dollar buys — aim for at least 3:1. Payback is CAC ÷ (monthly revenue × gross margin): the lower it is, the faster you can reinvest in growth.
If your ratio is healthy but growth is slow, the constraint is usually volume — getting in front of more of the right people, more often.
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Frequently asked questions
What is CAC?
CAC (customer acquisition cost) is the total sales and marketing spend divided by the number of new customers it produced. If you spend $5,000 to win 50 customers, your CAC is $100.
What is a good LTV:CAC ratio?
A 3:1 LTV:CAC ratio is the common benchmark for a healthy business. Below 1:1 you lose money on every customer; far above 3:1 can mean you're underinvesting in growth.
What is CAC payback period?
It's how many months of gross profit per customer it takes to recoup what you spent to acquire them. Under 12 months is generally considered strong for a subscription business.