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Where the money goes
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Free go-to-market tool
CAC CalculatorCustomer acquisition cost, payback and LTV:CAC in 30 seconds.
Spend keeps going up and nobody can say when a new customer pays back. Enter one period of sales and marketing spend and the customers it produced. You'll see your real CAC, how many months it takes to earn it back, and which lever moves the number most.
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- Instant result
How it works
CAC is the price of a customer.Payback tells you if it's worth it.
Customer acquisition cost (CAC) is everything you spent on sales and marketing in a period, divided by the new customers you won in that period. On its own, CAC doesn't tell you much. A $20,000 CAC is cheap if a customer pays $100,000 a year and expensive if they pay $5,000. So this calculator also shows payback: how many months of gross profit it takes to earn the CAC back.
CAC = (marketing + sales & marketing payroll + tools) ÷ new customers
CAC payback (months) = CAC ÷ (first-year deal size ÷ 12 × gross margin)
LTV = first-year deal size × gross margin ÷ annual churn (capped at 7 years)
LTV : CAC = LTV ÷ CAC
CAC payback (months) = CAC ÷ (first-year deal size ÷ 12 × gross margin)
LTV = first-year deal size × gross margin ÷ annual churn (capped at 7 years)
LTV : CAC = LTV ÷ CAC
What counts toward CAC
Use blended, fully loaded CAC. Include salaries, commissions and benefits for everyone in sales and marketing, plus ads, events, agencies, content and the tools they use. Leave out customer success and account management, which belong to retention. Many teams report "paid CAC" with ad spend only. It makes the number look three to five times better than it is, and it hides the biggest cost: people.
CAC payback benchmarks
| Segment | Typical deal size | Healthy payback | Concerning |
|---|---|---|---|
| SMB | Under $15k | 6–12 months | 18+ months |
| Mid-market | $15k–$100k | 12–18 months | 24+ months |
| Enterprise | $100k+ | 18–24 months | 30+ months |
A common rule of thumb is an LTV:CAC ratio of 3:1 or better. Below that, growth costs more than it earns back. Far above 5:1 can mean you're underinvesting and leaving growth on the table.
How to lower CAC without cutting growth
Cutting spend lowers CAC on paper and usually slows growth just as much. The bigger lever is the bottom of the formula: more customers from the same spend. That comes from aiming reps at accounts that are showing a buying signal right now instead of a static list. It also comes from knowing which channels produce closed-won deals, not just leads, and from learning why deals are lost with a closed-lost review. If you're not sure where the spend is going, the GTM plan generator shows the channel mix and rep math that fit your deal size.
FAQ
CAC questions.Answered plainly.
What is customer acquisition cost (CAC)?
Customer acquisition cost is the total amount you spend on sales and marketing to win one new customer. Add up sales and marketing spend for a period, including salaries, commissions, ads, events and tools, and divide by the number of new customers won in that same period.
How do you calculate CAC?
CAC = total sales and marketing spend in a period ÷ new customers won in that period. If you spent $480,000 on sales and marketing last quarter and won 24 new customers, your CAC is $20,000.
What is a good CAC payback period?
For most B2B SaaS companies, under 12 months is excellent and 12 to 18 months is healthy. SMB-focused companies should aim for 6 to 12 months. Enterprise companies with large contracts can accept 18 to 24 months. Beyond 24 months, growth usually consumes more cash than it can sustain.
What should be included in CAC?
Include fully loaded salaries, commissions and benefits for sales and marketing, plus advertising, events, agencies, content and the sales and marketing tools you pay for. Exclude customer success and account management costs, which belong to retention and expansion.
What is a good LTV to CAC ratio?
A common benchmark is 3:1, meaning a customer generates three times their acquisition cost in gross profit over their lifetime. Below 3:1, growth is expensive. Well above 5:1 can mean you are underinvesting in sales and marketing.
How can I lower CAC without slowing growth?
Win more customers from the same spend instead of cutting spend. Focus reps on accounts showing buying signals, move budget toward channels that produce closed-won deals rather than leads, and fix the pipeline stages where deals stall. Raising average deal size also shortens payback.
Is this CAC calculator free? Do you store my numbers?
Yes, it is free and there is no signup. The calculation runs in your browser and your numbers are not sent to us. The only place they appear is in the share link, if you choose to copy it.