The LTV:CAC ratio compares what a customer is worth to what they cost to win. Enter both to see your ratio against the healthy 3:1 benchmark — then model it by segment with the full tool.
The ratio, by segment, plus the CAC payback behind it.
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A widely-cited benchmark is around 3:1 — a customer's lifetime value being roughly three times what it cost to acquire them. Below about 1:1 you lose money on each customer; between 1:1 and 3:1 you're profitable but spending heavily to grow; much above 3:1 can mean you're under-investing in growth and could afford to spend more to acquire customers faster. It's a guide, not a hard rule, and should be read with your growth stage in mind.
Gross margin, in almost all cases. Lifetime value should reflect the profit a customer generates, not their revenue, because serving them has a cost. Using revenue-based LTV inflates the ratio and can make unprofitable acquisition look healthy. This calculator treats LTV as a gross-margin figure so the ratio against CAC is meaningful.
A ready-to-use spreadsheet (Excel & Google Sheets): LTV:CAC by segment against the 3:1 benchmark, plus CAC payback — delivered instantly after checkout. AI-assisted, human-built; not financial advice.
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