Free calculator
CAC payback calculator
CAC payback is the number of months it takes a new customer's gross profit to repay what it cost to acquire them. Divide customer acquisition cost by monthly revenue per customer multiplied by gross margin. A shorter payback means growth needs less cash up front.
to earn back what one customer cost.
LTV to CAC: 5.6×
Worked examples
| Inputs | Working | Result |
|---|---|---|
| CAC $1,800, $400 a month, 76% margin, 3% churn | $400 × 76% = $304 gross profit a month. $1,800 ÷ $304 = 5.92. LTV is $304 ÷ 3% = $10,133, and $10,133 ÷ $1,800 = 5.63 | 5.9 months, LTV to CAC 5.6× |
| CAC $600, $50 a month, 80% margin, 4% churn | $50 × 80% = $40 a month. $600 ÷ $40 = 15. LTV is $40 ÷ 4% = $1,000, and $1,000 ÷ $600 = 1.67 | 15 months, LTV to CAC 1.7× |
Payback is CAC divided by monthly gross profit per customer, rounded to one decimal. LTV here is monthly gross profit divided by monthly churn, which assumes churn stays steady. It is shown only when you enter churn.
Sondola reads spend from Meta Ads and Apple Ads and paying customers from Stripe or RevenueCat, so CAC and payback update every period. Read the CAC payback guide for the mistakes that distort it.
Questions
Why use gross margin and not revenue?
Revenue has to pay for delivering the product first. Only the gross profit left over repays acquisition, so payback on revenue alone looks faster than it is.
What goes into CAC?
Paid media plus the sales and marketing costs of winning customers in the period, divided by the new paying customers in the same period. Be consistent about which costs you include.
What is a good CAC payback?
A commonly cited rule of thumb is under 12 months for subscription businesses, but it depends on churn and how much cash you have. Payback only matters if customers stay longer than it.
Payback that updates itself.
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