How do you calculate CAC for SaaS?

Divide total sales and marketing spend for a period by the number of new customers won in that same period. Include salaries, commissions, tools, agencies and ad spend, not only paid media. Using matching periods for spend and customers is what makes the number comparable over time.

How do you calculate LTV for a SaaS business?

A simple version multiplies average monthly revenue per customer by gross margin, then divides by monthly churn. Dividing by churn estimates how many months a customer stays. Using gross margin rather than revenue shows the value you actually keep after the cost of delivering the product.

What is a good LTV to CAC ratio?

Many SaaS teams use about 3x as a rule of thumb, meaning a customer returns roughly three times what it cost to acquire them. It varies by stage and market, and early data is often noisy. Treat it as a prompt for discussion, alongside CAC payback, rather than a fixed target.

Free template · RevOps, CRM & metrics

SaaS Unit Economics Calculator

Calculate CAC, LTV, LTV:CAC and CAC payback from five inputs, and see at a glance whether your growth is efficient.

Excel · 2 tabs

What's inside

CAC from spend and new customers
Gross-margin LTV and customer lifetime
LTV:CAC ratio
CAC payback in months

Who it's for

Founders checking whether their growth is efficient before scaling spend.

Why it matters

Growth can look healthy while each new customer costs more than they will ever return. Early-stage founders often track new revenue but not what it took to get it, especially once salaries, tools and agency fees are spread across several budgets. Unit economics put spend and customer value side by side.

These numbers also shape decisions you are about to make: whether to hire another seller, raise ad spend or change pricing. Investors ask for CAC, LTV and payback, and they notice when definitions shift between updates. Calculating them the same way each period, from the same inputs, gives you a consistent baseline to compare against.

How to use it

1Enter total sales and marketing spend and new customers for the same period on the Calculator tab, including salaries, tools, agencies and ads in spend.
2Add average monthly revenue per customer, gross margin and monthly customer churn. Use real figures from billing where you have them.
3Read CAC, average customer lifetime, gross-margin LTV, LTV:CAC and CAC payback in the results block, and note which input moves each one most.
4Rerun the calculator each quarter with fresh inputs and compare results over time rather than against a single rule-of-thumb target.

Read alongside it

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SaaS Unit Economics Calculator: FAQ

How do you calculate CAC for SaaS?: Divide total sales and marketing spend for a period by the number of new customers won in that same period. Include salaries, commissions, tools, agencies and ad spend, not only paid media. Using matching periods for spend and customers is what makes the number comparable over time.
How do you calculate LTV for a SaaS business?: A simple version multiplies average monthly revenue per customer by gross margin, then divides by monthly churn. Dividing by churn estimates how many months a customer stays. Using gross margin rather than revenue shows the value you actually keep after the cost of delivering the product.
What is a good LTV to CAC ratio?: Many SaaS teams use about 3x as a rule of thumb, meaning a customer returns roughly three times what it cost to acquire them. It varies by stage and market, and early data is often noisy. Treat it as a prompt for discussion, alongside CAC payback, rather than a fixed target.

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