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CAC Calculator
Calculate your Customer Acquisition Cost (CAC) from marketing and sales spend, measure your CAC payback period, and check your LTV:CAC ratio against industry benchmarks. Essential for SaaS founders, growth marketers, and investors.
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Paying customers won in this period
Spend and customers are over this period
Enter your marketing spend, sales spend, and number of new customers to calculate CAC.
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Frequently Asked Questions
What is Customer Acquisition Cost (CAC)?
CAC is the total cost of sales and marketing required to acquire one new customer. CAC = (Total Sales Spend + Total Marketing Spend) / Number of New Customers Acquired. It is one of the most important unit economics metrics for any business, especially SaaS and subscription models.
What is a good LTV:CAC ratio?
A ratio of 3:1 is the benchmark standard - meaning the lifetime value of a customer should be at least three times what it costs to acquire them. Below 1:1 means you are spending more to acquire customers than they will ever pay you. Above 5:1 may indicate you are under-investing in growth.
How do I reduce my CAC?
Common approaches include: improving conversion rates on your website or sales funnel (so each marketing pound converts more customers), investing in content and SEO for organic acquisition (low ongoing cost), building a referral programme (customers acquiring customers), and tightening your ideal customer profile (ICP) to focus spend on channels that convert best.
What is CAC payback period?
CAC payback period is how many months it takes to recover the cost of acquiring a customer from their revenue. Payback Period = CAC / (ARPU × Gross Margin %). For SaaS, under 12 months is healthy; 12-24 months is acceptable; over 24 months creates cash flow risk.
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