LTV: Lifetime Value

LTV (Lifetime Value) is the total revenue a customer is expected to generate over the entire relationship, a key input to CAC payback and unit economics.

What is LTV?

LTV is most useful when paired with CAC. A healthy SaaS business runs an LTV/CAC ratio above 3 and recovers CAC inside 12 months.

Frequently Asked Questions

What is a good LTV/CAC ratio?: 3:1 or higher is the SaaS benchmark. Below 1:1 means you're losing money on every customer.