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LTV to CAC calculator

LTV:CAC is a unit-economics metric. It has no single agreed formula — state the inputs. Meaningless without both definitions stated.
LTV to CAC ratioLTV:CAC = LTV ÷ CAC
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LTV : CAC

3.9 : 1

How it’s worked out

  1. 1LTV($400 × 78.0%) ÷ 2.00%$15,600
  2. 2CAC$480,000 ÷ 120$4,000
  3. 3LTV ÷ CAC$15,600 ÷ $4,0003.9

Runs in your browser; nothing you type is sent anywhere. Amounts in US dollars.

How to read it

LTV:CAC compares what a customer is worth with what it cost to acquire.

Below 1:1 every new customer destroys value; around 3:1 is the usual target.

Common mistakes

  • Building LTV on revenue and CAC on fully loaded cost.
  • Quoting the ratio with infinite LTV from zero churn.

Questions

What is a good LTV:CAC ratio?
3:1 is the common benchmark. Much higher can mean the company is under-investing in growth.
How does it relate to CAC payback?
Payback measures how fast acquisition cost is recovered; LTV:CAC measures how many times over. Read them together.

Read it with

The metrics read alongside this one, and the terms it is confused with.

The formula is the one the glossary states, and the arithmetic is unit-tested. A ratio with nothing to divide by shows a dash — undefined is not zero. General information, not financial advice.

Works in your QuickBooks Online or Xero file

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