92.4
Concept
LTV:CAC
LTV:CAC is lifetime value divided by customer acquisition cost. In the room it is a ratio gate: roughly 3:1 is bare minimum, 4:1 is more comfortable. If CAC is high, LTV has to clear payback or the growth story is a burn story.
Where founders get this wrong
- Reporting LTV with heroic retention and CAC that ignores fully loaded sales and marketing.
- Optimizing the ratio while payback period quietly stretches past runway.
- Using blended CAC to hide a channel that will never pay back at scale.
Related concepts
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