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Understand your customer acquisition efficiency and whether your growth is actually profitable. Use this CAC and LTV calculator to measure how much it costs to acquire customers and how much value they generate over time. A healthy LTV:CAC ratio is critical for sustainable growth and investor confidence.
Enter your numbers
Total monthly marketing cost
Total monthly sales team cost
Total monthly sales team cost
Revenue earned from one customer per month
How long a customer stays with you
Your Runway
Customer Acquisition Cost (CAC)
$50000Customer Lifetime Value (LTV)
$100000LTV : CAC Ratio
6CAC vs LTV Comparison
What is CAC vs LTV?
Customer Acquisition Cost (CAC) is the total cost of acquiring a new customer, while Lifetime Value (LTV) represents the total revenue a customer generates over time.
Together, these metrics help you understand whether your growth is profitable. If LTV is significantly higher than CAC, your business model is sustainable.
| Feature | CAC | LTV |
|---|---|---|
| What it measures | Cost to acquire a customer | Revenue from a customer |
| Focus | Acquisition efficiency | Customer value |
| Better when | Lower | Higher |
To understand how quickly you recover CAC, use the CAC Payback Period Calculator.
Benchmarks
| Metric | Healthy Range |
|---|---|
| < 1 | Losing money |
| 2 | Moderate |
| 3+ | Healthy |
| 5+ | Very efficient |
Example Scenario
Spend:
$30,000Customers:
150CAC:
$200Revenue per customer:
$50/monthLifetime:
24 monthsLTV:
$1,200LTV/CAC:
6Who Should Use This Calculator?
Marketing teams to optimize acquisition spend.
Growth teams to measure unit economics
Product teams to improve retention and value.
Business owners to ensure long-term profitability.
Frequently Asked Questions
What is Customer Acquisition Cost (CAC)?
+CAC is the total amount you spend to acquire a new customer. This includes marketing campaigns, sales team costs, tools, and any related expenses required to convert a lead into a paying customer.
What is Lifetime Value (LTV)?
+LTV is the total revenue you expect to generate from a customer over the entire duration of their relationship with your business. It reflects retention, pricing, and repeat purchases..
What is a good CAC to LTV ratio?
+A ratio of 3:1 is widely considered healthy. This means you earn three times the cost of acquiring a customer, indicating sustainable growth.
Why is CAC vs LTV important?
+It helps you understand whether your growth is profitable. If CAC is higher than LTV, your business may lose money on each customer.
How can I improve my LTV?
+You can improve LTV by increasing retention, improving customer experience, offering upgrades, and building long-term relationships with customers.
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