LTV to CAC Ratio Calculator
Divide customer lifetime value by acquisition cost to see how many times a customer repays what it cost to win them.
- Value left after acquisition
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- Reading
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What is the LTV to CAC Ratio Calculator?
The LTV to CAC ratio compares what a customer is worth over their lifetime with what it cost to win them. A ratio of 3x means lifetime value is three times the acquisition cost. Judge it against your own margins, cash position and payback time rather than a fixed target.
How it works
Ratio = customer lifetime value / customer acquisition cost. Value left after acquisition = LTV minus CAC. If CAC is zero the ratio shows zero. Use LTV based on gross profit, not revenue, for a fair comparison with CAC.
How to use it
- Enter your customer lifetime value, ideally on a gross profit basis.
- Enter your customer acquisition cost.
- Read the ratio and the plain-language reading.
- Check payback time too, because a high ratio can still strain cash.
LTV to CAC Ratio Calculator — FAQ
What ratio should I aim for?
There is no universal answer. It depends on your margins, cash flow and how quickly you recover acquisition costs, so compare against your own history.
Does the ratio show how fast I recover cost?
No. It shows total return, not timing. Calculate payback period separately if cash is tight.
Should LTV be revenue or profit?
Profit is the safer basis. Revenue-based LTV makes the ratio look better than the real return.