Calculate customer lifetime value, customer acquisition cost, the LTV:CAC ratio, CAC payback period, and your maximum sustainable CAC — for SaaS, ecommerce, subscription, DTC, marketplace, and app businesses. The ratio tells you whether acquisition creates value; the payback tells you whether you can afford it. This tool computes both honestly: gross-profit LTV (not revenue), fully loaded CAC, discounted LTV, per-channel decisions, and the sensitivity of all of it to churn, pricing, and rising ad costs.
Educational estimate only — not accounting, tax, legal, investment, or financial advice. LTV assumes churn behaves like the recent past.
LTV:CAC = gross-profit lifetime value ÷ customer acquisition cost. A customer paying $50/month at a 70% gross margin with 5% monthly churn is worth $50 × 0.70 × 20 months = $700; acquired for $200 (from $50,000 of spend and 250 customers), the ratio is 3.5 : 1 with a 5.7-month CAC payback. Below 1 : 1, acquisition loses money — and a healthy ratio can still hide a cash problem if the payback is slow.
Calculator
Presets:
Simple
$
Everything spent to acquire customers in the period — ads, salaries, tools, agencies.
In the same period as the spend.
$
%
Revenue left after the cost of serving the customer.
%
Share of customers who leave each month. Lifetime = 1 ÷ churn.
Your inputs auto-save in this browser. The share link encodes them in the URL — nothing is sent to a server.
Results · per customer
Generally healthy
LTV:CAC ratio
3.5 : 1
Gross-profit LTV ÷ CAC.
CAC payback
5.7 mo
Strong
CAC
$200.00
Fully loaded spend ÷ new customers.
Gross-profit LTV
$700
Monthly gross profit × lifetime.
Customer lifetime
20 mo
1 ÷ monthly churn.
Net LTV after CAC
$500
Strong positive — reinvestable
Monthly gross profit / customer
$35.00
$50.00 ARPU × 70% margin.
Max sustainable CAC
$200.00
Binding ceiling across your ratio, payback, and profit targets.
Estimate only — not accounting, tax, legal, investment, or financial advice. LTV assumes churn behaves like the recent past.
13 sheets generated from your inputs with live formulas: a summary dashboard, the full SaaS and ecommerce models, a 12-row channel analysis, scenarios, churn/CAC/revenue sensitivity, and a 36-month payback timeline.
What to improve first
Each lever applies a comparable, realistic move to YOUR numbers and re-computes the ratio (currently 3.5 : 1). Ranked by impact.
1
Reduce churn
If you cut churn by 20% (relative):
4.38 : 1
+0.88
2
Lower CAC
If you cut acquisition cost 10%:
3.89 : 1
+0.39
3
Increase ARPU / pricing
If you lift revenue per customer 10%:
3.85 : 1
+0.35
4
Improve gross margin
If you add 5 margin points:
3.75 : 1
+0.25
Churn is usually the highest-leverage fix because lifetime is 1 ÷ churn — retention work compounds. The moves are standardized for comparability; your real options may be bigger or smaller.
Payback timeline
Cumulative gross profit per customer vs the $200 CAC over 36 months — capped at the average lifetime, beyond which the average customer has churned.
The CAC is recovered in month 6. Every month before that is acquisition cash you cannot reuse — scaling spend multiplies the locked-up amount.
Show the month-by-month table
Cumulative gross profit by month vs CAC
Month
Cumulative gross profit
CAC remaining
Break-even?
1
$35
$165
No
2
$70
$130
No
3
$105
$95
No
4
$140
$60
No
5
$175
$25
No
6
$210
$0
Yes
7
$245
$0
Yes
8
$280
$0
Yes
9
$315
$0
Yes
10
$350
$0
Yes
11
$385
$0
Yes
12
$420
$0
Yes
13
$455
$0
Yes
14
$490
$0
Yes
15
$525
$0
Yes
16
$560
$0
Yes
17
$595
$0
Yes
18
$630
$0
Yes
19
$665
$0
Yes
20
$700
$0
Yes
21
$700
$0
Yes
22
$700
$0
Yes
23
$700
$0
Yes
24
$700
$0
Yes
25
$700
$0
Yes
26
$700
$0
Yes
27
$700
$0
Yes
28
$700
$0
Yes
29
$700
$0
Yes
30
$700
$0
Yes
31
$700
$0
Yes
32
$700
$0
Yes
33
$700
$0
Yes
34
$700
$0
Yes
35
$700
$0
Yes
36
$700
$0
Yes
Hitting your targets
What it takes to reach a 3 : 1 ratio, a 12-month payback, and $500.00 net profit per customer — edit the targets in the inputs panel.
Sustainable CAC ceiling
$200.00
Current CAC $200.00 fits under it.
Max CAC for the ratio target
$233.33
Gross-profit LTV ÷ target ratio.
Max CAC for the payback target
$420.00
Monthly gross profit × target months.
Max CAC for the profit target
$200.00
Gross-profit LTV − target profit.
Required changes to hit the target ratio at the current CAC
To hit the target with…
Required value
You have
…a higher ARPU (everything else fixed)
$42.86/mo
$50.00/mo
…a better gross margin
60%
70%
…lower churn
≤ 5.8%/mo
5%/mo
…ARPU for the payback target
$23.81/mo
$50.00/mo
Sensitivity analysis
How the ratio, payback, and net LTV move when the three big assumptions move. The highlighted row is your current input.
Churn sensitivity· ±50%▾
LTV:CAC by churn rate
Churn
Lifetime
Gross-profit LTV
LTV:CAC
Payback
Net LTV
−50% (2.5%)
40 mo
$1,400
7 : 1
5.7 mo
$1,200
−25% (3.8%)
26.7 mo
$933
4.67 : 1
5.7 mo
$733
Current churn (5%)
20 mo
$700
3.5 : 1
5.7 mo
$500
+25% (6.3%)
16 mo
$560
2.8 : 1
5.7 mo
$360
+50% (7.5%)
13.3 mo
$467
2.33 : 1
5.7 mo
$267
Lifetime is 1 ÷ churn, so LTV moves inversely and non-linearly — halving churn doubles LTV. Payback stays put because it runs on monthly gross profit.
CAC sensitivity· −20% to +100%▾
LTV:CAC by acquisition cost
CAC
LTV:CAC
Payback
Net LTV
−20% ($160)
4.38 : 1
4.6 mo
$540
Current CAC ($200)
3.5 : 1
5.7 mo
$500
+20% ($240)
2.92 : 1
6.9 mo
$460
+50% ($300)
2.33 : 1
8.6 mo
$400
+100% ($400)
1.75 : 1
11.4 mo
$300
CAC usually rises as you scale — audiences saturate and auctions get pricier. Plan against +50%, not today's number.
ARPU sensitivity· ±20%▾
LTV:CAC by revenue per customer
ARPU
Gross-profit LTV
LTV:CAC
Payback
Net LTV
−20% ($40)
$560
2.8 : 1
7.1 mo
$360
−10% ($45)
$630
3.15 : 1
6.3 mo
$430
Current ($50)
$700
3.5 : 1
5.7 mo
$500
+10% ($55)
$770
3.85 : 1
5.2 mo
$570
+20% ($60)
$840
4.2 : 1
4.8 mo
$640
Pricing moves LTV and payback together — often the fastest fix when churn is already low.
Scenario comparison
Current, optimized, and aggressive-growth cases on the same unit economics. Edit the tweaks below — churn and margin move in percentage points, the rest in percent.
Scenario comparison table
Scenario
ARPU
Margin
Churn
CAC
LTV
LTV:CAC
Payback
Net LTV
Cohort value
Current
$50
70%
5%
$200
$700
3.5 : 1
5.7 mo
$500
$125,000
Optimized
$55
73%
4%
$180
$1,004
5.58 : 1
4.5 mo
$824
$205,938
Aggressive growth
$50
70%
5.5%
$250
$636
2.55 : 1
7.1 mo
$386
$173,864
Optimized wins on both the ratio and payback speed — the rare case where the best-LTV plan is also the cash-safest one.
Aggressive growth usually RAISES CAC (auction saturation) and can nudge churn up (lower-intent customers) — the defaults reflect that. Cohort value = net LTV × customers acquired.
Quick answers
What is the LTV:CAC formula?
LTV:CAC = gross-profit LTV ÷ CAC, where gross-profit LTV = monthly revenue per customer × gross margin × customer lifetime, and customer lifetime = 1 ÷ monthly churn. Use gross profit, not revenue — revenue LTV ignores the cost of serving the customer.
What is the CAC payback formula?
CAC payback (months) = CAC ÷ monthly gross profit per customer, where monthly gross profit = ARPU × gross margin. A $200 CAC against $35 of monthly gross profit pays back in 5.7 months. It assumes the customer survives that long — check payback against the average lifetime.
Revenue LTV ignores what it costs to serve the customer — support, hosting, payment fees, shipping, returns, fulfilment. At a 70% margin, a $1,000 revenue LTV is only $700 of gross profit; at a 30% margin it is $300. The ratio only means something when its numerator is money you actually keep.
What this calculator does
It answers the questions that decide whether customer acquisition is worth scaling: What does a customer really cost, fully loaded? What are they worth over their lifetime — in gross profit, not revenue? Is the LTV:CAC ratio healthy, thin, or loss-making? How long until the acquisition cash comes back? What is the most I can pay per customer and still hit my targets? Which channels deserve more budget, and which need a stop-loss? And how fragile is all of it to churn, pricing, and rising ad costs?
Four modes share the same transparent identities: Simple for the classic five-input model (the previous version of this page, kept intact); SaaS / Subscription with expansion and contraction, discounted (NPV) LTV, onboarding cost, ACV input, manual lifetime, and sales cycle; Ecommerce / DTC with refunds, payment fees, shipping, discounts, three ways to estimate lifetime orders, and payback in orders; and Channels for per-channel CAC, LTV, payback, and Scale / Optimize / Watch / Stop decisions.
Every output explains itself: interpretation bands say where you stand, the diagnosis names what hurts most, the lever ranking says what to fix first, and the formula section shows the exact arithmetic — the same arithmetic the downloadable workbook reproduces as live Excel formulas, validated cell-by-cell against this page's engine.
Why gross-profit LTV beats revenue LTV
Revenue LTV — ARPU × lifetime — is the number that makes dashboards look good and decisions go wrong. It counts money you do not keep: support and success teams, hosting and infrastructure, payment processing, shipping, returns, fulfilment. Those costs scale with every customer, so they belong inside the LTV, not outside it.
Gross-profit LTV multiplies by the gross margin first: ARPU × margin × lifetime. At an 80% SaaS margin the haircut is modest; at a 35% subscription-box margin it changes the answer entirely — a $1,000 revenue LTV is $350 of gross profit, and a “3 : 1” revenue ratio is really ~1 : 1. This page labels revenue LTV explicitly as “before servicing cost” and never uses it in the ratio. When your margin is below 40%, the calculator warns you about exactly this trap.
Why payback matters more than most teams think
LTV:CAC is a profitability ratio with no clock in it. CAC payback — CAC ÷ monthly gross profit — adds the clock: how many months until the cash you spent comes back. A 4 : 1 ratio with a 4-month payback and a 4 : 1 ratio with a 22-month payback are completely different businesses; the second one can grow itself into insolvency while every dashboard stays green.
The mechanics are brutal at scale: at an 18-month payback, every new cohort locks its acquisition cash up for 18 months. Double the spend and the locked-up balance doubles too — long before the lifetime profit arrives. That is why the calculator pairs every ratio with a payback band (0–3 months excellent · 3–6 strong · 6–12 healthy · 12–18 watch · 18–24 risky · beyond 24 capital intensive), draws the 36-month payback timeline, and flags the genuinely dangerous case: payback longer than the average customer lifetime, where the average customer churns before ever repaying their CAC.
SaaS vs ecommerce: the same ratio, different machinery
SaaS / subscription economics run on MRR and churn: lifetime = 1 ÷ monthly churn, monthly gross profit = ARPU × margin, and expansion revenue (upsells) offsets churn — the SaaS mode applies a conservative, static NRR-style adjustment and also computes a discounted (NPV) LTV, because a 30-month profit stream is not worth its face value today. Onboarding cost and sales-cycle length feed the months-to-break-even figure.
Ecommerce / DTC economics run on orders: contribution per order = AOV × (1 − refunds) × margin − payment fees − shipping − discounts, and LTV = contribution × lifetime orders. The hard questions are different: does the FIRST order make money after CAC, how many repeat orders does payback require, and is the repeat-purchase assumption real or hopeful? The ecommerce mode answers all three, converts payback into both orders and months, and offers three ways to estimate lifetime orders (direct, frequency × lifespan, or a repeat-rate estimate) with one source of truth at a time.
At a 10% annual discount rate, the NPV LTV is ≈ $2,090 — about 21% below the undiscounted figure. Long-lifetime LTVs always shrink under discounting; that is the point.
Example 3 — an ecommerce store that loses money on first orders
$75 AOV, 45% margin, 5% refunds, 2.5% payment fees, $7 shipping, $5 discounts → contribution per order = $18.19 (24.3% of AOV).
$7,500 spend acquires 300 customers → CAC = $25: the first order LOSES $6.81. At 4 lifetime orders, LTV = $72.75 → ratio 2.9 : 1, payback 1.4 orders ≈ 2.7 months at 6 orders/year.
The whole model rests on the 4-orders assumption — exactly the kind of dependency the diagnosis section calls out and the workbook stress-tests.
The blended-CAC trap
Blended CAC divides ALL acquisition spend by ALL new customers — including the ones who arrived through SEO, referrals, and word of mouth at near-zero marginal cost. Those cheap customers drag the average down, so a store can report a comfortable blended CAC while its paid channels quietly run at a loss.
The Channels mode makes the split explicit: each channel gets its own CAC, LTV, ratio, payback, and a Scale / Optimize / Watch / Stop decision; the summary compares blended vs paid-only vs organic CAC; and a warning fires when the blended ratio looks acceptable (≥ 2) while paid channels sit below 2 : 1. The rule it encodes: scaling decisions spend their money on PAID channels, so they must be judged on paid economics — organic does not scale linearly with budget.
Common mistakes
Using revenue instead of gross profit
Revenue LTV overstates value by exactly your cost of service. A 2 : 1 "revenue ratio" at a 40% margin is a 0.8 : 1 gross-profit ratio — acquisition is losing money while the dashboard says otherwise.
Ignoring salaries and tools in CAC
CAC is spend ÷ customers, where spend includes the sales team, marketing tools, agencies, and content — not just the ad platforms. A half-loaded CAC can double your apparent ratio.
Using blended CAC only
Organic customers drag the average down and hide expensive paid channels inside a healthy-looking blend. Segment paid vs organic — the Channels mode and the workbook do this split explicitly.
Assuming churn stays flat forever
The 1 ÷ churn lifetime is a geometric average, not a promise. Young cohorts, seasonal patterns, and pricing changes all move churn — and LTV moves inversely and non-linearly with it.
Ignoring payback timing
LTV:CAC is a profitability ratio with no clock in it. Two businesses at 4 : 1 are not equal when one recovers CAC in 4 months and the other in 24 — the second can grow itself into a cash crisis.
Treating 3 : 1 as universal truth
The right target depends on margin structure, cash position, funding, and growth stage. A bootstrapped store may need 4 : 1 with a 6-month payback; a funded SaaS may rationally run at 2.5 : 1 to win a market.
Comparing across industries blindly
A subscription box at 35% margins and an enterprise SaaS at 85% margins produce incomparable ratios from identical revenue. Benchmarks only mean something within similar margin structures.
Ignoring refunds and fulfilment in ecommerce LTV
Refunds, payment fees, shipping subsidies, and discounts come out of every order. Skipping them inflates the contribution per order — and every metric downstream of it.
Optimizing ROAS while losing money on payback
A campaign can clear its ROAS floor on first orders while the CAC payback stretches past the cash runway. ROAS guards the marginal sale; LTV:CAC payback guards the balance sheet. You need both.
Scaling on unproven repeat-purchase assumptions
When first orders lose money, the lifetime-orders assumption IS the business model. Verify it with cohort data before multiplying it by a bigger ad budget.
How to improve LTV:CAC — in the order that usually pays
Reduce churn first. Lifetime is 1 ÷ churn, so retention compounds: cutting churn from 5% to 4% adds 25% to LTV. Better onboarding, activation milestones, retention emails and CRM flows, win-back campaigns, and annual plans all attack it. The calculator's lever ranking shows what a 20% churn cut does to YOUR ratio.
Improve gross margin. Hosting and support efficiency, COGS negotiation, packaging. Every margin point flows straight into LTV.
Raise ARPU / AOV carefully. Pricing, packaging, add-ons, bundles, free-shipping thresholds. ARPU lifts LTV and shortens payback simultaneously — the only lever that does both.
Lower CAC. Cut weak channels and creatives, improve landing-page conversion, lean on referral programmes. Note the asymmetry: CAC cuts have a floor; LTV improvements compound.
Increase repeat purchases (ecommerce). Post-purchase flows, subscriptions, loyalty programmes — repeat orders are where store LTV actually lives.
Stop weak channels. Use per-channel economics, not the blend. A channel below 1 : 1 is a subsidy programme for your competitors' auctions.
Track cohorts. Every figure here is an average; cohort curves tell you whether the average is improving or rotting underneath you.
When NOT to scale paid acquisition
Scaling multiplies whatever economics you already have. Hold the budget — and fix the model first — when any of these is true:
LTV:CAC is below 2 : 1 — there is no cushion for the CAC inflation that scaling itself causes.
CAC payback is beyond 18–24 months and your runway cannot carry the locked-up cash.
CAC is rising faster than LTV cohort over cohort — the auction is telling you something.
Churn is unstable or your cohorts are too young to know what churn even is.
Repeat-purchase or expansion assumptions are unproven — first-order losses make them THE business model.
Gross margin is weak (below ~40%): margin problems compound at scale; ads do not fix them.
Cash runway is short — the payback timeline section shows exactly how long acquisition cash stays locked up.
Assumptions
Customer lifetime uses the geometric-survival average (1 ÷ churn) and assumes the churn rate holds; the manual-lifetime option exists precisely for when it does not.
CAC payback assumes the customer survives through the payback window — the calculator flags the case where the average customer churns first.
The expansion/contraction adjustment is static (ARPU × (1 + e − c)), deliberately more conservative than compounding net revenue retention.
The ecommerce model treats refunds as removing the full margin of refunded orders while fees, shipping, and discounts are still paid on every order shipped.
Percentages are 0–100 inputs and are clamped; impossible quantities render as “Not possible” or “Not meaningful”, never as infinity.
The four modes are independent models sharing identities, not one merged dataset — each exports its own inputs to the workbook.
Limitations
This is an educational planning estimate, not bookkeeping — it does not replace your accounting records, CRM, or professional advice.
LTV is a forecast wearing a formula: churn drift, pricing changes, and cohort mix all move it. Re-estimate from real cohorts regularly.
CAC inputs are only as honest as what you include — salaries, tools, agencies, and creative belong in the numerator.
Attribution is imperfect: channel-level CAC inherits every attribution problem your analytics has.
No benchmark here is an industry standard — every threshold is a planning band, and your margin structure decides what “good” means.
It compares the lifetime gross profit of a customer with the cost of acquiring them. It answers the most basic growth question: does a dollar of acquisition spend create more than a dollar of value? Below 1 : 1, growth destroys money; the higher above it, the more efficiently acquisition compounds.
How do I calculate CAC correctly?
Divide your fully loaded sales and marketing spend by new customers acquired in the same period. Fully loaded means ads, salaries and commissions, tools, agencies, creative, and acquisition discounts. If customers take months to convert (a long sales cycle), align the spend window with the cohort it actually produced.
How is customer lifetime calculated from churn?
Average lifetime = 1 ÷ monthly churn rate. At 5% monthly churn, the average customer stays 20 months. This is a geometric-survival average: many customers leave earlier, a few stay much longer. If churn is 0 or your cohorts are too young to measure it, use a manual lifetime estimate instead — the SaaS mode supports both.
What is a good LTV:CAC ratio for SaaS?
The folk benchmark is 3 : 1 or better, with CAC payback under about 12 months. But the honest answer depends on gross margin, cash position, and growth stage. The calculator bands: below 1 losing money, 1–2 weak, 2–3 thin, 3–5 generally healthy, above 5 very efficient (check the CAC is fully loaded and that you are not under-investing in growth).
What is a good LTV:CAC ratio for ecommerce?
Stores live or die on the contribution per order after refunds, fees, shipping, and discounts — and on whether repeat purchases genuinely happen. A 3 : 1 lifetime ratio that needs 4 repeat orders to materialise is riskier than a 2.5 : 1 that breaks even on the first order. Watch payback in orders, not just the ratio.
What is discounted (NPV) LTV?
Future profit is worth less than present profit. Discounted LTV = expansion-adjusted monthly gross profit ÷ (monthly churn + monthly discount rate) — the closed form of discounting each future month by your cost of capital. The longer your payback and the lower your churn, the more the undiscounted figure overstates value.
How does expansion revenue change LTV?
The SaaS mode applies a static net-revenue-retention-style adjustment: adjusted ARPU = ARPU × (1 + expansion % − contraction %). Real NRR compounds, so this is deliberately conservative — but even the static version shows how upsells offset churn. Verify expansion-heavy LTV with cohort data before scaling on it.
What is the maximum CAC I can afford?
Three ceilings matter: LTV ÷ target ratio (profitability), monthly gross profit × target payback months (cash), and LTV − target profit per customer (margin of safety). The calculator computes all three and the binding (lowest) one — that is your real constraint, and it is usually the payback ceiling for cash-constrained businesses.
Why is my ratio high but my business still cash-poor?
Because the ratio has no clock. A 5 : 1 ratio with a 20-month payback means every new customer locks up acquisition cash for 20 months before turning profitable — scale that and the locked-up balance grows faster than the profit. Check the payback timeline section and your runway before raising budgets.
Should I segment CAC by channel?
Yes — blended CAC hides weak channels behind cheap organic acquisition. The Channels mode computes CAC, LTV, ratio, payback, and a Scale / Optimize / Watch / Stop decision per channel, plus the blended-vs-paid split, and warns when a healthy blend conceals paid channels below a 2 : 1 ratio.
Does this calculator work for any currency?
Yes — the calculations are currency-agnostic ratios, and the currency selector (USD, INR, EUR, GBP, CAD, AUD, SGD, AED, JPY, and more, plus a custom symbol) only changes formatting on screen and in the exported workbook.
What does the downloadable workbook contain?
A 13-sheet Excel/Google Sheets model generated from your inputs with live, editable formulas: a Start Here guide, an Inputs sheet, a Summary Dashboard with statuses and the best improvement lever, full SaaS and ecommerce models, a 12-row channel analysis, scenario comparison, churn/CAC/revenue sensitivity tables, a 36-month payback timeline, chart-ready blocks, and an assumptions & limitations sheet. No macros.
How do I read my LTV:CAC ratio result?
Match it to the bands: below 1 = losing money on acquisition; 1–2 = weak; 2–3 = acceptable but thin; 3–5 = generally healthy; above 5 = very efficient — or a sign the CAC is under-counted or growth is under-funded. The popular 3 : 1 figure is a rule of thumb, not a law, and it says nothing about cash timing.
What is the SaaS vs ecommerce LTV formula?
SaaS: LTV = ARPU × gross margin × (1 ÷ monthly churn), optionally expansion-adjusted. Ecommerce: LTV = contribution per order × lifetime orders, where contribution = AOV × (1 − refunds) × margin − payment fees − shipping − discounts. The store version must deduct per-order costs or it overstates LTV badly.
Related calculators
This page answers “is acquisition worth it?” — these tools take the neighbouring questions:
Break-Even ROAS CalculatorA CFO-grade ad-profitability tool — marginal and business-level break-even ROAS, target ROAS for a desired net margin, max CAC and LTV-adjusted CAC, break-even MER, max ad budgets, SKU/channel comparison, scenarios, sensitivity heatmaps, and a 10-sheet Excel workbook.
Ecommerce Profit CalculatorAn ecommerce operator’s profitability dashboard — net profit per order after product costs, platform and payment fees, shipping, ads, and returns, with break-even price and ROAS, max affordable CAC, fixed-cost break-even, channel and SKU comparison, a scenario planner, and a 12-sheet Excel workbook.
Profit Margin CalculatorA full profitability cockpit — gross, contribution, operating, and net margin across simple, advanced, ecommerce, service, SaaS, and solve-for modes, with target pricing, discount impact, break-even, scenarios, SKU comparison, and a 17-sheet Excel workbook.
Break-Even CalculatorA full break-even planner — units and revenue break-even, contribution margin, target profit, margin of safety, and a viability verdict across simple, detailed, service, ecommerce, multi-product, and solve-for modes, with scenarios, sensitivity tables, a break-even chart, and a 12-sheet Excel workbook.
Markup CalculatorPrice from cost across 9 modes — markup, target margin, price analysis, profit target, reverse cost ceilings, ecommerce landed cost after fees, discount impact, quantity profit, and batch comparison, with a 10-sheet Excel pricing workbook.
ROI CalculatorReturn on investment five ways — simple ROI, date-based ROI, net ROI after fees/taxes/income, a reverse target solver, and a two-investment comparison — with gain/loss, annualised ROI (CAGR), and a multi-sheet Excel report.
Sources & methodology
The calculator applies standard unit-economics arithmetic: CAC = fully loaded spend ÷ new customers; lifetime = 1 ÷ monthly churn (or a manual estimate); gross-profit LTV = expansion-adjusted ARPU × margin × lifetime; discounted LTV = expansion-adjusted monthly gross profit ÷ (churn + monthly discount rate); the ecommerce model deducts refunds, payment fees, shipping, and discounts per order before multiplying by lifetime orders. The exported workbook reproduces the identical formulas as live, editable Excel formulas, validated cell-by-cell against this page's engine. No ratio benchmark on this page is presented as an industry standard — interpretation bands are planning guides. Calculator Matters is an independent project, not affiliated with any source listed; concepts are summarized in our own words. Links open in a new tab.
LTV/CAC Ratio — formula and interpretationCorporate Finance Institute · Verified 2026-06-12 · The ratio identity and the common ~3:1 benchmark framing (as a guideline, not a law)
Last reviewed: 14 June 2026. Formula and assumptions reviewed for accuracy. First published 13 June 2026.
Business planning disclaimer
This LTV:CAC calculator and its XLSX workbook are for educational planning only. They do not predict actual customer behaviour, investment returns, profitability, cash flow, tax treatment, or business success. Churn-based lifetimes assume the future behaves like the recent past; expansion and repeat-purchase assumptions carry real uncertainty; CAC usually rises as you scale. This is not accounting, tax, legal, investment, or financial advice — validate every assumption against your own accounting records, CRM, ad platforms, and analytics, and consult professional advisors before major decisions.
Built and maintained by Calculator Matters, an independent calculator project. Method checked against the published sources above · Last reviewed 14 June 2026 · How we calculate · Found an error? [email protected]
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