4.00x is the example result. Read it using the units and relationship stated below.
SaaS LTV:CAC uses saas ltv, cac.
Separating growth, retention and subscription capacity
For saas ltv:cac, the relationship is Result = (([SaaS LTV]) ÷ ([CAC])). The amount depends on the supplied saas ltv, cac, rather than a live market price or a value imported from another record. Recurring revenue should be compared across the same starting cohort. Expansion, contraction and churn change retention in different directions. Adding new customers to a retained-customer calculation can conceal losses in the original population.
Source and result record
For saas ltv:cac, retain SaaS LTV, CAC together with the output. Record the date of the source values and the unit convention used in the form. That record separates a change in the underlying case from a change in how the information was entered. A saved result without its source values cannot show which assumption produced it.
Example with the supplied inputs
SaaS LTV: 1800; CAC: 450. Result: 4.00x. The values are illustrative.
Compare one changed input
SaaS LTV changes from 1800 to 1980. The result becomes 4.40x. All other inputs remain fixed.
Calculation rule
Result = (([SaaS LTV]) ÷ ([CAC]))
Inputs and output
| Input | Example value | Entry convention |
|---|---|---|
| SaaS LTV | 1800 | Use the source quantity represented by saas ltv. Keep the counted population fixed and avoid mixing a unit value with a period total. |
| CAC | 450 | Use the source quantity represented by cac. Keep the counted population fixed and avoid mixing a unit value with a period total. |
Output: 4.00x is the example result. Read it using the units and relationship stated below. Use the formula to distinguish a cash amount, count, percentage or ratio.
How to use the page
Collect the inputs
Gather SaaS LTV, CAC. Use one period and the units shown in the form.
Run the calculation
Enter the values and select the action. The calculation rule above explains how the inputs produce the result.
Compare a scenario
Change SaaS LTV on its own, keeping the other inputs fixed. Read both results before changing another assumption.
Worked example
With the example inputs listed above, the result is 4.00x.
Change SaaS LTV from 1800 to 1980 while keeping every other value fixed. The result becomes 4.40x. This comparison isolates that input; it does not forecast how other variables will respond.
Check the stated formula, units and limits before using the result in a decision.
Keep the displayed formula, input units and model scope with the result. Corrections or questions can be sent through the request section on this page.