Unit Economics — SaaS glossary
The per-customer math behind sustainable SaaS growth - CAC, LTV, payback period.
CAC (Customer Acquisition Cost)
The total cost of acquiring a new paying customer, including marketing and sales expenses.
LTV (Customer Lifetime Value)
The total revenue a customer generates over their entire relationship with your product.
CAC Payback Period
The number of months it takes to recover the cost of acquiring a customer.
LTV:CAC Ratio
The ratio between customer lifetime value and acquisition cost - the core measure of unit economics health.
Gross Margin
Revenue minus the direct costs of delivering your service, expressed as a percentage.
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