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LTV Calculator
Calculate Customer Lifetime Value, LTV:CAC ratio, and payback period. Add gross margin for the full economic picture. Results update as you type.
LTV inputs
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Enter your ARPU and monthly churn rate above to calculate LTV.
What LTV tells you
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LTV sets your acquisition ceiling
Your LTV is the maximum you can spend acquiring a customer and still be profitable. Knowing your LTV tells you exactly how much you can afford to spend on ads, sales, and content per converted customer.
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3:1 LTV:CAC is the floor, not the target
The 3:1 benchmark accounts for operational overhead, support costs, and discounting. Best-in-class SaaS runs 5:1 or higher. Under 1:1 means you're destroying value with every customer acquired.
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Churn reduction is the highest LTV lever
Halving your churn rate doubles your LTV — without touching acquisition, pricing, or product scope. Focus on onboarding, activation, and customer success before trying to raise ARPU.
LTV:CAC benchmarks
< 1:1
PoorLosing money on every customer acquired
1–3:1
OkayBelow the standard benchmark — improve retention or cut CAC
3–5:1
HealthyIndustry benchmark — solid unit economics
5:1+
ExcellentBest-in-class — may be underinvesting in growth
Frequently asked questions
Strong LTV:CAC? Time to scale acquisition.
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