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Customer Lifetime Value to CAC Ratio (LTV:CAC)

This ratio is a key growth metric, especially for SaaS and subscription businesses.

The LTV:CAC ratio tells you how sustainable your growth is.

For example, if your LTV is $900 and CAC is $300, your ratio is 3:1, which is generally considered healthy.

A ratio below 1:1 indicates you’re losing money on every acquisition, while extremely high ratios may suggest you’re under-investing in growth.