🧲Calculators

LTV / CAC Calculator

Compute Lifetime Value (LTV), Customer Acquisition Cost (CAC) and the LTV/CAC ratio. Healthy when ≥ 3. Everything in your browser.

Monthly ARPU (BRL) Gross margin % Monthly churn % CAC (BRL)

LTV

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CAC

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LTV/CAC

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LTV = (ARPU x Margin) / Churn. Healthy: LTV/CAC >= 3.

LTV/CAC: SaaS unit economics

LTV (LifeTime Value) is the average expected revenue from a customer over their lifetime. Simple formula: LTV = ARPU · gross_margin · (1 / churn). CAC (Customer Acquisition Cost) = total_acquisition_spend / new_customers (include marketing + sales). Example: ARPU R$ 100/month, 80% margin, 5% monthly churn → LTV = 100 · 0.8 · (1/0.05) = R$ 1,600. With CAC = R$ 400, ratio = 4.

Benchmarks and context

A 3:1 LTV/CAC ratio is considered healthy — LTV should be at least 3× the CAC. Below 1 = losing money on every customer; above 5:1 = you can probably invest more in acquisition. CAC payback should be under 12 months (ideal under 6 months). Standard inputs for SaaS unit economics, growth decisions, and Series A pitches.

FAQ

Should CAC include salaries? Yes — fully-loaded CAC includes marketing spend, sales team salaries and commissions, plus tools (CRM, paid ads). Marketing-only CAC underestimates real cost.

Why multiply LTV by gross margin? Revenue isn't profit. Gross margin removes COGS (hosting, payment fees, support) so LTV reflects contribution margin, not topline.

What if churn is very low? The 1/churn formula assumes constant churn. For very low churn (<1%/month), cap the customer lifetime at a reasonable horizon (e.g. 5 years) to avoid inflating LTV.

Calculate LTV, CAC and the ratio between them

If a business grows sustainably, two numbers explain why. One is LTV, the lifetime value, which measures how much revenue each customer generates over the relationship. The other is CAC, the customer acquisition cost, which measures what it takes to win that customer. The calculator delivers both and, above all, the ratio between them.

The LTV/CAC ratio is where the gauge lives. The rule of thumb says it turns healthy from 3 upward, meaning each customer is worth at least three times what it cost to acquire them. Drop below that and there's a sign the model is spending too much to grow. The tool puts this indicator front and centre so you can measure acquisition efficiency.

The calculation runs in the browser and nothing is kept. Founders, marketing teams and anyone who has to justify spend on acquisition find here the number that backs the argument.

Frequently asked questions

Why does LTV swing so much when I barely touch churn?

Because churn sits in the denominator. The formula is (ARPU × margin) ÷ churn, which makes the average customer lifetime 1 ÷ churn: 5% a month gives 20 months, 4% gives 25 and 2% gives 50. A single percentage point of error in the estimate swings LTV by tens of percent, and that is what makes measuring churn the most delicate part of the job. With the values loaded by default, ARPU 100, margin 80% and churn 5%, LTV lands at 1,600.

Do the values have to be on a monthly basis?

ARPU and churn have to sit in the same time window, and the labels ask for a month because that is how most SaaS teams track the metric. Mixing annual revenue with monthly churn throws LTV off by a factor of twelve. CAC carries no period at all: it is what winning a customer costs once. The screen shows Brazilian reais and offers no currency selector, yet the maths holds in any currency as long as ARPU and CAC share it.

What do the colours on the LTV/CAC ratio mean?

Green from 3 upward, amber between 1 and 3, red below 1. Below 1, each customer returns less than it cost to win, and growing only digs the hole deeper. Between 1 and 3 the business pays for itself, but too slowly to fund a team, support and infrastructure. From 3 up is the range treated as healthy, and a ratio well above 5 usually signals room to spend more on acquisition rather than a reason to celebrate.

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The results provided by this tool are for general informational and educational purposes only and do not constitute professional, financial, medical, legal, tax or accounting advice. Always confirm important decisions with a qualified professional and official sources.