Global SaaS metric
LTV:CAC Ratio Calculator
Healthy SaaS businesses often target 3:1 LTV:CAC or higher.
LTV
$2,000.00
CAC
$500.00
LTV:CAC ratio
4.00x
LTV:CAC ratio benchmarks
Reading the ratio
The LTV:CAC ratio compares the value a customer brings over their lifetime to the cost of acquiring them. A ratio below 1:1 means you lose money on each new customer before considering overhead.
Many SaaS investors look for at least 3:1 at scale, with faster-payback businesses tolerating slightly lower ratios if growth is capital-efficient.
Context beyond the number
Payback period matters as much as the ratio. A 4:1 LTV:CAC with 24-month payback may be worse than 2.5:1 with 6-month payback if you are bootstrapped.
Track ratio by channel and cohort. Blended averages hide channels that destroy value.
Frequently asked questions
- ?What is a good LTV:CAC ratio?
- Many SaaS benchmarks cite 3:1 as a healthy minimum, though optimal ratios vary by ACV, sales motion, and payback period.
- ?What is a good LTV:CAC ratio for early-stage SaaS?
- Pre-PMF companies often show low ratios while experimenting. Post-PMF, aim for 3:1+ on your primary acquisition channel before scaling spend aggressively.