LTV:CAC Ratio Calculator
Analyze the ratio between Lifetime Value and Acquisition Cost.
Formula
LTV:CAC Ratio = Customer Lifetime Value ÷ Customer Acquisition CostWhat is LTV:CAC?
The LTV:CAC Ratio is a core health metric that directly compares the lifetime value of a customer to the cost of acquiring them, indicating exactly how much value you get back for every dollar spent on growth.
How to calculate LTV:CAC
Simply divide your calculated LTV by your CAC. You'll typically express the result as a ratio (e.g., 3:1).
Example calculation
If a customer yields $3,000 in gross profit over their lifetime (LTV) and it costs you $1,000 to acquire them (CAC), your ratio is: $3,000 ÷ $1,000 = 3:1 LTV:CAC Ratio.
Why LTV:CAC matters for SaaS
An LTV:CAC ratio of 3:1 or higher is the gold standard for SaaS. If your ratio is 1:1, you are breaking even (or losing money fast). If it's 8:1, you're likely under-spending on marketing and missing out on faster top-line growth.
📊 Promote your SaaS tool here · Learn more
Other SaaS Calculators
MRR Calculator
Calculate your Monthly Recurring Revenue and track growth trends.
LTV Calculator
Estimate Customer Lifetime Value to understand long-term revenue potential.
CAC Calculator
Measure your Customer Acquisition Cost and optimize marketing spend.
Churn Rate Calculator
Track customer churn rate and identify retention opportunities.
ARPU Calculator
Calculate Average Revenue Per User across your customer base.
CAC Payback Period Calculator
Determine how long it takes to recoup your customer acquisition spend.
Revenue Growth Rate Calculator
Measure month-over-month or year-over-year revenue growth percentage.
Net Revenue Retention Calculator
Track net revenue retention including expansion and contraction revenue.