LTV:CAC Calculator — Customer Lifetime Value to CAC Ratio

What is LTV:CAC? This ratio tells you how much revenue a customer generates over their lifetime (LTV) relative to what you spent to acquire them (CAC). It's the fundamental measure of whether your business model works.

The benchmark: A healthy LTV:CAC is 3:1 or higher. Below 1:1 means you're losing money on every customer. Between 1:1 and 3:1 means you're growing but not profitable. Above 5:1 may mean you're under-investing in growth.

Who it's for: SaaS founders, subscription businesses, e-commerce brands, and investors evaluating unit economics.

Customer Revenue

Average Revenue Per User ($/mo)

Gross Margin (%)

Monthly Churn Rate (%)

Annual Revenue Growth (%)

Unit Economics

Customer CAC

—

cost to acquire

Customer LTV

—

lifetime value

LTV:CAC Ratio

—

target: 3:1 or higher

Gross Profit/Customer

—

per customer

Avg Customer Lifespan

—

months

Payback Period

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months to recover CAC

LTV calculation uses a simplified model. Actual LTV depends on pricing changes, expansion revenue, and cost to serve. Use for strategic planning, not precise financial forecasting.