How to use the LTV:CAC Calculator
- 1
Enter average monthly revenue per account and your gross margin.
- 2
Add monthly churn, plus last month's sales and marketing spend and new customers.
- 3
Compare your ratio and payback with the healthy ranges shown.
The formulas
LTV = monthly revenue per account × gross margin ÷ monthly churn rate. CAC = sales and marketing spend ÷ new customers won in the same period. CAC payback = CAC ÷ (monthly revenue per account × gross margin).
What good looks like
Widely used SaaS benchmarks:
- LTV:CAC of 3:1 or higher is generally healthy
- Below 1:1 you lose money on every customer
- CAC payback under 12 months is strong for most SMB SaaS
- A very high ratio can mean you're under-investing in growth
How SEO changes the math
Organic search lowers blended CAC because content keeps bringing sign-ups after it's published. Tracking organic sign-ups separately in GA4 shows how much cheaper that channel is than paid.
Frequently asked questions
What is a good LTV to CAC ratio?
Around 3:1 is the common target. It means each customer brings in about three times what it cost to acquire them.
Should LTV use revenue or gross margin?
Gross margin. Revenue-based LTV overstates what a customer is really worth.
What churn rate should I use?
Your average monthly logo churn over the last 6 to 12 months. For annual plans, convert annual churn to monthly.
Is my data stored?
No. Everything is calculated in your browser.